Brent Community Infrastructure Levy & Section 106: what it has been spent on and the amount remaining

 

Last week the Brent Cabinet approved the annual Infrastructure Funding Statement with little discussion. Millions of pounds is involved so it is worth looking at it in some detail. To help readers I have extracted some of the tables. The full Statement with detailed commentary can be read HERE,

Brent Council introduces the Statement (extracts):

The Council has been collecting the borough’s Community Infrastructure Levy (CIL) since July 2013. CIL is a levy applied to most developments granted planning permission that commence, and is to help deliver the infrastructure needed to support the development of the area. CIL is also important in demonstrating to communities the benefits that new development can bring, including through key infrastructure projects, place-making and local improvements.

The borough CIL receipts can be broken down into three portions – the Strategic CIL, the Neighbourhood CIL and the Administration CIL. A Mayoral CIL of £60 per sqm is collected as well and passed on to TfL on a quarterly basis. The borough keeps 4% of this levy for administrative purposes. All London Boroughs are subject to this levy, with the money used to fund the Elizabeth Line and Crossrail 2

The Council also enters into Section 106 agreements with developers – a mechanism which makes a development proposal acceptable in planning terms. S106 agreements are focused on site-specific mitigation of the impact of development such as securing affordable housing or requiring improvements to an access road. CIL, on the other hand, is designed to raise funds for infrastructure needed generally as a result of an increase in development in an area, and is spent on community infrastructure projects across the borough.

 

Although the Council has had high CIL receipts compared to the majority of other London Boroughs, it is important to note that future years CIL receipts may not be as strong given the current financial and economic conditions in the UK which may affect the commencement of developments and subsequently, CIL receipts.

The  receipts from CIl and Section 106 and their use are one of the justifications that councillors use when challenged on the anount of development in the borough that is rapidly changing its face. Provision of housing during a housing crisis and the subsequent rise in Council Tax receipts are also quoted.

One of the controversial aspects is the amount of both Strategic CIL and Neighbourhood CIL that remains unspent or unallocated at the end of the financial year and is carried forward.

The actual amount spent in 2021-22 (rounded) was SCIL £7,058,222. NCIL £4,575,043 - TOTAL £11,635,265 of which CIL Admin was £681,441.

The amount collected in 2021-22 and the amount carried forward from previous years that has not been allocated (£60m) :

 STRATEGIC CIL

So what has the SCIL been spent on?:

South Kilburn

Wembley Park

There is a full description of the Olympic Way 'improvements' which follow the large expenditure on the replacement steps in previous years. The expenditure is justified in the Statement:

The improvements are a recognition that Wembley Park is an area of national and international importance. The high quality public realm supports the ongoing transformation of the area into a thriving, attractive environment where people want to live with access to shops and entertainment.

The North End Road/Bridge Road reconnection has yet to be signalised and buses are not yet using it avoid the stadium on event days to avoid delays and curtailment of services.

NEIGHBOURHOOD CIL

 

For the distribution of Neighbourhood CIL the borough is divided into NCIL areas including the two Neighbourhood Forums. Wembley continues to get a higher allocation on the basis that it is most impacted by new developments:

There is a description of many of the projects allocated funds in the Statement and a full list can be found HERE. I understand that not all projects progress to actually receiving the funds as there are various legal and financial hoops to get through.

 

SECTION 106 FUNDING

 

Section 106 is site specific and is funding that makes a development acceptable to Planning. It is sometimes a financial contribution but may also be an allocation of the housing approved as so-called 'affordable housing'. This returns to an argument familiar to readers about the precise meaning of affordable. As the Brent Poverty Commission said that only social housing was truly affordable to Brent residents, bear that in mind when looking at the figures for the housing contribution:

So just under 14% of the 'affordable' units (column 2)  are social rent and under 4% of the total units (column 3)  in the developments.

 Section 106 Financial Contributions

 What immediately struck me on looking at these figures was the amount, £3.5m,  spent on transportation  compared with the other areas.

Transportion includes: cycle parking, electric vehicle charging points, signage around Wembley Stadium, Roe Green/Kingsbury Road junction, hostile vehicle measures in Wembley Park around the stadium and 'Wembley Two Way Working'  including North End Road mentioned earlier under SCIL.

Full details of the projects funded can be found in the Statement.

 

 

 

 

Where has all Brent's CIL and S106 money gone?

 In an aside at last week's Planning Committee when speaking against the proposed Wembley Park Station 'Five Tower', Cllr Kansagra, said that Brent Council had lots of unspent Community Infrastructure Levy and Section 106 money in its coffers and gave the figure of £126,000,000.

We will be able to check on that claim by looking at the first Brent Annual Infrastructure Funding Statement  for the year 2019-2020 that will go to Cabinet on Monday December 7th.  Given the controversy about the use of the funding that there is in the borough,  it would  help allay concern if the Statement was called in for Scrutiny.

You will find some extracts below which help give an overall view and further full details and explanations can be found in the very extensive report. 75% of CIL is labelled Strategic CIL (SCIL) and used for infrastructure projects, 5% for managing CIL and the rest for Neighbourhood CIL (NCIL) - used for local community led projects after a bidding and selection process.

£63m unallocated and therefore unspent

Note the difference between 'allocated' and 'spent'.

So at the end of the year 2019-20 there was £105m in the SCIL coffer and £14m in NCIL - £119m rounded

So about half of the NCIL collected in 2019-20  £2m) was spent on neighbourhood projects  but the amount retained, including from previous years, was £14m.

Barnhill and Preston wards are missing but may be covered by multi-wards. A lot depends on how organised councillors and community groups in their wards are in terms of putting in bids. Again this is 'allocated' not spent. Often there is underspend and in 2019-20 it would have beenimpacted by Covid restrictions at the end of year.

The individual projects allocated funds and the amount spent can be found in the full report (Table 6) it covers 7 pages.

 

£4.7m of Section 106  appears to have been carried forward and not allocated to any project.  Added to the £119m on SCIL and NCIL it amounts to £124m - not far off Cllr Kansangra's figure.

Affordable units in developments were secured as part of the Section 106 deal. A good use of S106.

Underspend probably the result of Covid lockdown.

 Full report here include indications of future expenditure on infrastructure that would use up some of the retained funds. Click bottom right corner for full page version.