Recommendation 9

The Department explained that the First Homes discount will be funded through contributions from developers.24 Local authorities will be expected to ensure 25% of affordable homes built by developers contribute to the First Homes initiative.25 However, we have previously criticised approaches which rely on developer contributions—the Community Infrastructure Levy and section 106 agreements—for their complexity and lack of transparency over how much developers actually contribute.26 In our 2019 report Planning and the broken housing market, we were concerned that this approach too often favoured developers at the expense of local communities. We found that local authorities can lack the skills needed to negotiate contributions from developers through section 106 agreements. While they can also use the Community Infrastructure Levy to get contributions, implementing this is complex, time consuming and yields small returns in areas of low value. Only 47% of local authorities had implemented the Community Infrastructure Levy by 2019. We recommended that the Department should monitor whether its reforms to the Community Infrastructure Levy and section 106 were having the impact that was needed and adjust or adapt accordingly.27 21 Qq 81, 85, 90 22 Qq 83–85, 90 23 Qq 84, 90 24 Qq 83, 86 25 Q 83 26 Committee of Public Accounts Report, Planning and the broken housing market, One Hundred and Third Report of Session 2017–19, HC 1744, 26 June 2019 27 PAC’s Report, para 4 Starter Homes 11 2 Building more homes to meet housing need Target for new homes