Infrastructure Levy proposals amended to protect the delivery of affordable housing

The government has tabled a number of amendments related to Infrastructure Levy, echoing the calls and recommendations the NHF has continued to make to protect the delivery of onsite affordable housing.

The amendments go a long way to ensuring that the changes proposed under the Levy do not result in a loss of affordable housing, and we are extremely pleased that the government has listened to our calls and tabled these amendments in response to them.

In total, four amendments have been introduced in relation to the Infrastructure Levy. The amendments will look to ensure that the Levy will be capable of delivering at least as much affordable housing as the existing system of developer contributions, requiring local authorities to seek to ensure “that the level of affordable housing which is funded, and provided by developers, and the amount of such funding, is maintained or exceeded.”

The amendments will also allow local authorities to require developers to pay a proportion of their Levy contributions in-kind as onsite affordable housing.

A further amendment to the Levy in relation to the government’s ‘test and learn’ approach will mean that local authorities will be able to revert to using Section 106 contributions should the Infrastructure Levy fail to deliver it’s aims, including for example providing enough affordable housing in the area.

Other amendments will require the Secretary of State to publish a report on the impact of the Infrastructure Levy on the delivery of affordable housing.

In response to the amendments, Kate Henderson, Chief Executive of the NHF, said: “At a time of a chronic shortage of social homes, these amendments to the proposed Infrastructure Levy in the Levelling Up and Regeneration Bill represent a hugely welcome step for the protection of affordable housing.

“We are grateful for the positive and constructive engagement we’ve had with the government on this issue. Ministers have heeded the specific concerns of the sector and its supporters in the House of Lords. The change to the Bill will mean that local planning authorities ‘must seek to ensure’ affordable housing funding is maintained or exceeded when the new Infrastructure Levy is introduced, and that planning authorities can also require developers to pay a proportion of this Levy in-kind as onside affordable housing.

“At a time where there are 4.2m people are in need of a social home it’s critical that housing associations, local authorities and central government work together to ensure that we are delivering quality housing that people can afford. The NHF will continue to work with the government as it commits to test the new levy to help ensure it benefits communities across the country.”

Since the Levy was first announced as part of the Levelling Up and Regeneration Bill, we have been clear in our conversations with the government that the delivery of onsite affordable housing must be protected under any proposed plans and changes to legislation.

Earlier this year, we wrote to the Secretary of State for Levelling Up, Housing and Communities, Michael Gove MP, expressing our initial concerns around the Levy. We later wrote to Secretary of State again, joining 30 organisations calling on the government to reconsider its plans. In our response to the technical consultation on the Infrastructure Levy, we continued to outline our concerns and recommendations.

The amendments, which are in direct response to our calls and concerns on the Levy, will help protect the delivery of onsite affordable housing, however we will continue to work with the government so that we can deliver the affordable homes the country needs.