Infrastructure funding: County Councils have a CIL problem. IL will make it worse.
Before Christmas, I wrote about a fight that had broken out in Gloucestershire over CIL funding.
The County Council was concerned about the lack of CIL receipts being received from the district and borough authorities within its area, which was directly impacting on the County Council's ability to deliver the infrastructure for which it is responsible.
This disconnect between the collection of CIL and the delivery of infrastructure is built into the CIL Regulations. It is a fundamental part of how the system has been designed.
Outside of London, there can only be one CIL Charging Authority in an area. In two-tier authority areas, the CIL charging authority tends to be the Local Planning Authority, who not only set the appropriate level of CIL for their area but are also responsible for collecting and distributing the funds.
Whilst there are provisions in the CIL Regulations that ringfence CIL funds for infrastructure spending, there are no mechanisms for ensuring that:
- Any of the revenue raised through CIL is transferred to County Councils; or
- that any of the revenue raised through CIL is actually spent at all.
In the absence of any statutory mechanisms or firm guidance setting out how CIL is to be distributed, it is left to each charging authority to put their own systems in place. This often results in a patchwork of different allocation requirements within a single county council area.
Since I wrote that piece in November, I have noticed an increasing number of County Councils seeking s.106 Contributions from developments in CIL charging authorities, for types of infrastructure that are supposedly CIL funded.
This has made me curious about just how wide spread the 'Gloucestershire' problem might be.
In a fit of extreme nerdery*, earlier this week, I decided to check the Infrastructure Funding Statements of a random selection of County Councils in England**.
My findings are set out in the table below.
| County Council and year of IFS | CIL Receipts | s 106 Receipts | Comments |
|---|
| Cambridgeshire 21/22 | unclear as IFS does not report on CIL receipts. East Cambs shows CIL expenditure of £150,000 on works to A142 Witchford Road which likely went to County. Huntingdonshire's IFS showed no spending on county matters in 21/22. | £40,958,428.57 | Two of the five districts in the county charge CIL |
| Derbyshire 21/22 | none | £11,270,043.88 | only one authority in the county charges CIL |
| Kent 21/22 | £394,681 from Folkestone & Hythe | £47,233,172 | Five of the twelve district/borough councils in the county charge CIL |
| Gloucestershire 21/22 | £277,500 CIL funding (all from Stroud District) | £19,404,122 | Five of the six district/borough councils in the county charge CIL |
| Hampshire 21/22 | none | £47,446,811 | Eight of the eleven districts in Hampshire charge CIL |
| Leicestershire 21/22 | none | £47,569,289 | There are no CIL charging district councils in Leicestershire |
| Oxfordshire 21/22 | £7.3m CIL from South and Vale District Councils. | £47.5 million S106 funding was received in 2021/22. | Three of the five district councils charge CIL |
| Warwickshire 21/22 | £610,000 | £39,482,205 | Two of the five district/borough councils in the county charge CIL |
| West Sussex 21/22 | £94,590 received from chichester district council | £32,118,604.83 | Six of the eight district/borough councils in the county charge CIL |
| Worcestershire 21/22 | none | £6,526,759 | Three of the six district councils in the county charge CIL. The County Council also did not recieve any CIL receipts in fy 20/21 |
Admittedly, the above is only a snapshot. It only reflects funds received in a single year in a handful of County Councils. As snapshots go, however, it is a fascinating one.
The vast bulk of infrastructure funding received from developers by these County Councils comes from s.106 Agreements. This remains the case even when the level of CIL take-up amongst the district and borough councils in the County is both high and well-established, such as in Hampshire, Gloucestershire and West Sussex.
In some areas, in the last financial year, the County Council received no CIL funding at all.
There could be any number of reasons for this. As I stated above, under the CIL Regime, the prioritisation and allocation of CIL funding is a matter for CIL charging authorities. The allocation processes within those authorities are rarely consistent.
A prime example of this can be found in Kent County Council's most recent Infrastructure Funding Statement:
Table 9 – District CIL regimes and access to CIL funding
| District | Position | Process for accessing CIL funds |
| Ashford | No CIL | - |
| Canterbury | Adopted Apr 2020 | Bidding process under development |
| Dartford | Adopted Apr 2014 | Representation within Leader’s Advisory Group and projects within Dartford’s Infrastructure Delivery Plan |
| Dover | No CIL | - |
| Folkestone and Hythe | Adopted Jul 2016 | Set proportion of funds passed to KCC annually to spend on CIL infrastructure priorities |
| Gravesham | No CIL | - |
| Maidstone | Adopted Oct 2017 | Application to annual bidding process |
| Sevenoaks | Adopted Feb 2014 | Application to CIL Spending Board |
| Swale | No CIL | - |
| Thanet | No CIL | - |
| Tonbridge and Malling | No CIL | - |
| Tunbridge Wells | No CIL | - |
It is probably unfair to say that the adoption of CIL is actively reducing the amount of infrastructure funding making its way to County Councils (although Gloucestershire certainly has done so).
What we can fairly infer, however, is that accessing CIL funding appears to be far less straightforward for County Councils than obtaining money secured via s.106 Agreements (which are usually paid to the County Council direct). Which may well be the reason that requests for county infrastructure (usually education and highways) in CIL charging areas seem to be on the rise.
This is a problem which is not going to go away if the Infrastructure Levy comes into effect. In fact it is going to get worse.
As currently designed, the Infrastructure Levy largely duplicates the structure of CIL. Responsibility for collection and allocation of funding remains with the local planning authorities, with a very limited role for County Councils.
The stakes, however, are significantly higher, as the Infrastructure Levy consultation proposes removing the ability to also seek s.106 contributions entirely from all but the very largest development sites. This means that the ability of County Councils to 'top up' CIL funds through the use of s.106 Agreements will be heavily curtailed.
County Council funding is coming under increasing pressure. Only last November, both Kent and Hampshire County Councils wrote to the Government stating that they might have to declare bankruptcy in the coming year.
Against that background, anything which makes it harder for County Councils to access infrastructure funding that would otherwise be readily available can hardly be considered a good thing.
*Not a word, but it should be.
** I did also look for the Infrastructure Funding Statements for Lancashire and Staffordshire for financial year 21/22 but was unable to find them.
1.2.In a two-tier authority the responsibility to collect CIL rests with district and borough councils to
implement and collect CIL. As a result, WCC is not a CIL collection authority. Within Worcestershire, three of the six district councils (Malvern Hills, Wychavon and Worcester City also referred to as the South Worcestershire Councils) collect CIL. WCC did not receive any CIL funding from these district councils for the financial year 2021/22. CIL funding is therefore not
included in this report and the associated data”
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