Response to Council Motion - Scrutiny of Community Infrastructure Levy Payments (EX4004)
Purpose: To provide a response to the Motion presented to the 3 December 2020 Council meeting.
Resolved to reject the Motion contained in 1.1 of the report. The Community Infrastructure Levy (CIL) Regulations clearly set out the procedures that can be taken to dispute a CIL charge by the Charging Authority. The complaints relating to the two cases referred to in the motion were not upheld by the Local Government Ombudsman. Furthermore the cases date back to 2015 and 2017, since then changes have been made to both the Regulations and the Council’s CIL processes. In addition, the CIL team have been audited twice and found to be Satisfactory.
This decision is eligible to be ‘called-in’. However, if the decision has not been ‘called-in’ by 5.00pm on 1 April 2021, then it will be implemented.
The Executive considered a report (Agenda Item 8) concerning the Motion – Scrutiny of Community Infrastructure Levy Payments.
At the 3rd December 2020 Council meeting the following motion 18 (b) was submitted in the name of Councillor Jeff Brooks:
‘We call upon the Council to urgently engage external expertise to undertake an independent review of the management of CIL payments from local developers. This is in light of two cases – that Members are aware of – where the sums paid by the applicants have been contested as they maintain they have been penalised by many thousands of pounds for incorrect paperwork submissions. These were able to be corrected rapidly when pointed out to the Applicant, but the Council pressed on in charging the applicant based on the original assessment.
The Council resolves to engage with an independent scrutineer – potentially from an adjacent Local Authority – to undertake an external review of its method of handling CIL payments from developers – including the processing of them, the interface with developers on the amounts due and the paperwork being submitted accurately.’
The Chairman had informed the Council that, in accordance with Procedural Rule 4.9.8 the Motion if seconded, would be referred to the Executive for consideration.
Councillor Hilary Cole stated that much had been made in respect of the two cases mentioned in the Motion, particularly in the local press, however, in both cases the Local government Ombudsman had found in the Council’s favour. Councillor Brooks mentioned that incorrect submissions were corrected rapidly when pointed out by the applicant, and this was correct. However, planning permissions lasted for three years. Although checks were carried out on an annual basis it would be impossible to check every planning application as these could commence at any time over the three year period.
In the instances mentioned in the report, both of the applicants had appointed agents who had submitted the paperwork on their behalf. The error had clearly sat with the applicants’ agents who were, along with the applicants, given several opportunities to get things corrected. She therefore suggested that the agents should be the ones from whom the applicants should seek redress and she understood that this might have happened in one of the cases. All of the paperwork sent out to applicants clearly stated that it was the responsibility of the applicant to submit the correct information in the correct manner and the Council’s website also had comprehensive and clear guidance regarding CIL submissions. Councillor Cole stated that she had found Councillor Brooks’ comments in the press distasteful and untrue. CIL legislation was prescriptive and the Council’s CIL process had been audited twice internally which was an independent operation. She did not agree that the Council should appoint an independent scrutineer as it would incur unnecessary cost to the Council and local taxpayers. The Local Government Ombudsman had also acted as a scrutineer and therefore she proposed that the Motion should be rejected.
Councillor Jo Stewart asked if there would be any benefit of another independent scrutineer. Councillor Hilary Cole replied that there would not be any benefit at all and any further scrutiny would incur additional costs.
Councillor Lynne Doherty referred to the two cases in question and that there seemed to have been numerous attempts at getting information but she asked for clarification as to what the actual process was. Councillor Hilary Cole responded that once a planning application had been approved then a CIL Liability Notice would be issued and at that point the applicant could query or challenge that CIL liability. People were not allowed to start development until the CIL papers were completed, and if an exemption was agreed the applicant could not commence work prior to notifying the Council. In the cases referred to in the report that notification had not been carried out. She stressed that the CIL team were incredibly helpful and there was a lot of information available on the website.
Councillor Jeff Brooks confirmed that he was hearing of more of these cases and he would raise those separately. He asked if both of the applicants had filled in all their paperwork correctly would those properties have been zero rated according to CIL. Councillor Hilary Cole said that the simple answer was yes, they would not have been charged CIL but they had not filled in the paperwork correctly. Councillor Brooks reiterated the fact that just because the applicants or their agents had not filled in the forms correctly then it had cost them thousands of pounds. Councillor Cole replied that two specific cases had been highlighted but there were many other people who had filled in the forms correctly and had not had to pay CIL. The Council had to be fair and abide by the legislation which was extremely prescriptive with little room for manoeuvre.
Councillor Carolyne Culver said that she was also aware of cases where people had been charged because loft space had been added to the new build, even though the loft space was not to be habitable and also an incident where the calculation had not taken into account that some of the existing building was knocked down when the new build was put up and therefore it was not a net calculation. That had led to people being charged when they should not had been. Paragraph 5.6 made reference to four cases and then the report detailed two cases and she asked what the conclusion of the Ombudsman had been with regard to the other two cases that had not been mentioned in detail. The report also identified 11 weaknesses and she asked if Councillor Cole could expand upon that. Councillor Cole advised that she was not aware of the other cases mentioned but would enquire and get back to Councillor Culver. She confirmed that she would provide a written response to all the questions that had been raised.
Councillor Graham Bridgman referred to the two cases and stated that many people had maintained that they were correct and that the actions of someone else had materially affected them. The applicants had two opportunities to challenge the decision before going to Court – one being by planning appeal and secondly to the Local Government and Social Care Ombudsman. The Motion was seeking external expertise to undertake an independent review but the internal audit process was independent and it was not unusual for Internal Audit to identify some issues within a service. The weaknesses identified in the report were moderate and five of them were minor. Both the Planning Inspectorate and the Local Government and Social Care Ombudsman were independent external reviewers and had found in favour of the Council. If an agent was employed and failed to submit the paperwork correctly then the applicants should look to the agent to recompense. If the Council was losing a lot of cases then of course it would call in an independent investigator but that was not the current situation.
RESOLVED that the Executive resolved to reject the Motion contained in paragraph 1.1 of the report. The Community Infrastructure Levy (CIL) Regulations clearly set out the procedures that could be taken to dispute a CIL charge by the Charging Authority. The complaints relating to the two cases referred to in the Motion were not upheld by the Local Government Ombudsman. Furthermore the cases dated back to 2015 and 2017, since then changes had been made to both the Regulations and the Council’s CIL processes. In addition, the CIL team had been audited twice and found to be ‘Satisfactory’.
Other options considered:
(1) Option A - The motion requests that the Council invites another Charging Authority in to check its processes so such issues do not arise in the future.
(2) All the Berkshire authorities charge CIL and follow the same processes as West Berkshire Council, in line with the latest regulations. The only differences between the authorities is the amount charged and the type of development that incurs the charge. If an external audit team was to be appointed it could cost between £7,000 and £20,000 based on a 15 day process.
(3) Option B – The Council is a member of the Planning Advisory Service CIL and Section 106 advisory group which also includes representatives from the Ministry of Housing Communities and Local Government. PAS do offer an advisory service which could be retained to check Council processes, however there would still be a fee associated with undertaking this review.
(4) Option C – Reject the motion.