Recommendation 7

HM Government Accepted

28. The Levelling Up and Regeneration Bill already enables the Infrastructure Levy to be spent on childcare and early education, and there are other tools available to support local authorities to secure developer contributions to help meet their statutory duties, as explained below. 29. Contributions from developers play an important role in providing infrastructure to mitigate the impacts of new development in a local authority area, alongside other sources of funding. The Levelling Up and Regeneration Bill introduces a new Infrastructure Levy which aims to capture more value than the existing system of developer contributions, comprised of Section 106 planning obligations and the Community Infrastructure Levy (CIL). 30. The Infrastructure Levy can be spent on infrastructure which supports the development of an area. This includes funding the provision, improvement, replacement, operation, or maintenance of infrastructure. New section 204N(3) which will be inserted by Schedule 12 of the Bill sets out an illustrative list of kinds of infrastructure that the Infrastructure Levy may be spent on. The list includes “schools and other educational facilities”, which would include certain types of early years and childcare facilities such as nurseries or pre-school facilities. The list is non-exhaustive and local authorities will have the ability to decide what infrastructure should be funded in order to support the development of their area. This could include other facilities for school-age children such as before/after school clubs. The list at 204N(3) has been drafted purposely to give local planning authorities the flexibility to apply the Levy to the infrastructure that is needed in their specific area. This issue was discussed during the passage of the Bill through Parliament and the Government put on record that the Levy could be applied to fund childcare facilities. The Bill has now reached its final stage. 31. The effective planning and timely delivery of infrastructure is a priority for the Government. To support this, new section 204Q (which will be inserted by Schedule 12 of the Bill) requires local planning authorities to prepare Infrastructure Delivery Strategies. It is the Government’s intention that through the preparation and development of these strategies, local planning authorities will develop a clear understanding of the infrastructure needs in their area and develop a strategy for spending Levy proceeds in line with locally determined priorities. Government policy and guidance will ensure that local authorities are aware of their powers to spend Levy funding on childcare facilities. 32. The Infrastructure Levy will be introduced through a ‘test and learn’ approach. This means that a small number of local authorities will implement the Levy once regulations are made. This will allow us to work closely with local authorities to introduce the Levy and closely monitor its performance so that we can make changes to regulations, policy and guidance if needed. 33. DfE has recently updated guidance for local authorities on securing developer contributions for education.3 The guidance recognises the importance of securing developer contributions towards the cost of early years and childcare facilities, setting out best practice and explaining that “housing development should mitigate its impact on community infrastructure, including schools and other education and childcare facilities.” The guidance recommends that local authorities assess the need for early years and childcare facilities and secure developer contributions where appropriate. The guidance will be updated again when the Infrastructure Levy is applied nationally, following a trial period in a small number of local authorities.