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Concerns for social rent as government unveils plans to scrap Section 106
Planning reforms announced this week will scrap the system that delivers almost 50% of England’s affordable housing.
Ministers intend to abolish Section 106 and Community Infrastructure Levy planning agreements and replace them with a new overarching Infrastructure Levy as part of the move to a zonal planning system.
Housing commentators raised concerns about what the changes will mean for delivering social rented homes, with details limited as Inside Housing went to press on Wednesday night.
Melanie Rees, head of policy at the Chartered Institute of Housing, said: “The big question in my mind is what this means for social rented homes.
“Robert Jenrick has talked about people not being able to buy a home, but the planning system is about more than that.
“We’d like real reassurance that there won’t be a negative impact on homes for genuinely affordable rent as a result of this, and that’s a bit of a concern at the moment.”
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Kate Henderson, chief executive of the National Housing Federation, said: “Any alternative to Section 106 must ensure we can deliver more high-quality affordable homes to meet the huge demand across the country.
“Any new system must also enable the ’levelling up’ of communities that have already been left behind, such as rural communities or places with a struggling local economy.”
Section 106 planning agreements see developers deliver affordable homes in exchange for permission to build and are the biggest contribution to affordable housing supply.
In 2018/19, the mechanism accounted for 49% of all affordable homes completed in England.
Housing secretary Robert Jenrick claimed that the “once-in-a-generation” reforms will make planning decisions “simple and transparent, with local democracy at the heart of the process”.
The Infrastructure Levy will be a fixed portion of the value of the development, above a set threshold, with revenues going towards local projects such as new roads, playgrounds and discounted homes for local first-time buyers.
It will represent “a new simpler levy to replace the current system of developer contributions which often causes delay,” the government said in a press release.
But Hugh Ellis, policy director at the Town and Country Planning Association, agreed, adding: “For a national land tax to work it’s going to have to be very complicated and it’s going to be have to be graduated if it’s going to succeed.”
Richard Blyth, head of policy and practice at the Royal Town Planning Institute, said that a flat rate charge may be difficult to create because of differing land values across the country.
However, Helen Evans, chief executive of Network Homes and chair of the G15, said: “I strongly welcome the intention of government’s proposed reforms to increase transparency and certainty to help increase the delivery of affordable homes.”
A consultation on the proposals was due to be published on Thursday.
