Question
The Government has introduced new Regulations some of which came into force on 22 July. One in particular gives CIL charging authorities a discretion for a limited time to defer CIL payments, to dis-apply late payment interest and surcharge payments; and to credit interest already charged to developers.
What impact will this have on existing planning applications along with the Councils ability to deliver on infrastructure and climate emergency programs?
Minutes:
Question
The Government has introduced new Regulations some of which came into force on 22 July. One in particular gives CIL charging authorities a discretion for a limited time to defer CIL payments, to dis-apply late payment interest and surcharge payments; and to credit interest already charged to developers.
What impact will this have on existing planning applications along with the Council’s ability to deliver on infrastructure and climate emergency programmes?
Answer
Following the Covid-19 pandemic, the Community Infrastructure Levy (Coronavirus) (Amendment) (England) Regulations 2020 are now in force. These temporary regulations will remain in force until 31 July 2021. They are aimed at helping small and medium sized developers with an annual turnover of less than £45 million who are experiencing financial difficulties because of the effects of Covid-19. The regulations enable charging authorities to defer payments for up to 6 months, to temporarily dis-apply late payment interest and to provide discretion to return interest already charged where they consider it appropriate to do so.
The regulations can apply to any payment that fell due after 21 March 2020. The request should be made in writing no earlier than 14 days before the CIL payment is due. The Council can request further information which should be provided within 14 days of the request. The Council can grant or refuse the request. A deferral is for up to 6 months from the date the request was received. If the request is refused, the developer has 7 days from date of refusal to make the CIL payment. There is no right of appeal against a refusal.
We have published an FAQ and application form for those seeking deferred CIL payment on our website. I will send the link to you Gary. Any applications for deferrals will be required to demonstrate that their need for a deferral is as a direct result of Covid-19, including by submission of 2 years audited accounts and a written financial impact assessment.
To date we have not had received any applications for deferral of payment through this route. For the most part developers operating in Wokingham Borough are national house builders who do not qualify for deferral under this scheme so it is not anticipated it will have any impact on our major development proposals.
There is likely to be some deferred payments in relation to smaller developments, but it is important to note it is a deferral, not non-payment. Surcharges are discretionary in any case and we would be unlikely to apply them where a small business’ financial difficulties were clearly related to Covid-19. The scheme waives late payment interest, which would be mandatory under normal circumstances, for a deferred period. On the whole it is not anticipated that this particular scheme will impede delivery of the Council’s capital programme or climate emergency programme and is in line with the Council’s other measures to help support small businesses to survive the pandemic.
Supplementary Question
Thanks very much for that. It really is helpful. It really should have said what impact has on ability, not what impact will. From your answer, it is fairly clear that to date it has no impact. I would be interested in being kept up-to-date should you end up in the situation where we do get into problems with the developers but thank you for the answer.
Supplementary Answer
I will send it over to you Gary.