There have been two significant events recently on the issue of developer contributions to strategic infrastructure:
- the decision of the Supreme Court in the Elsick case; and
- the publication by the Scottish Government of the final part of a research project on an infrastructure charging mechanism.
Concerns about developer contributions to funding strategic infrastructure are not new – two years ago the Planning for Infrastructure Research project noted:
A core concern for The Scottish Government in commissioning this project was the issue of cumulative impact – ie. those situations where infrastructure is required to mitigate the impacts of more than one development. The research shows that the cumulative impact problem is at its most focused in areas of economic growth and development expansion where developers are expected to contribute to sub-national / regional transport projects or the provision or expansion of new schools. This is because the Circular requires a clear linkage between development and infrastructure impacts. Capture mechanisms are designed in great detail, but are still open to question on the basis of the principle of proving that linkage.
Proving that linkage was the pivotal issue in the Supreme Court’s decision.
Lawfulness of policy
The supplementary guidance required developers to enter into planning obligations (s75s) to make contributions to a pooled fund to be spent on infrastructure (the Strategic Transport Fund, STF).
The Supreme Court decided the policy was unlawful for two separate reasons:
- the trivial connection between the development and the infrastructure meant that the financial contribution was not imposed for a purpose in relation to the development and use of the burdened site as section 75 requires.
- also as a result of the trivial connection, it was not within the power of the planning authority to require a developer to enter into such an obligation which would be irrelevant to its application for planning permission as a precondition of the grant of that planning permission.
This decision poses as many questions as it answers. There needs to be more than a trivial connection, but when is a connection more than trivial? More fundamentally, are there some items of strategic infrastructure that can never have more than a trivial connection with individual developments?
The future – a levy?
The Supreme Court commented that if planning authorities want a local development land levy in order to facilitate development, legislation is needed.
Provision for a levy might be contained in the Planning Bill when it is published next month.
Options for a levy/ charging mechanism are explored in the research recently published by the Scottish Government.