My Lords, I think that it is explanations that are asked for rather than anything else. I was asked what “off-site” provision was. It is exactly what it says. As noble Lords will know, when an obligation is entered into for affordable housing, in many cases that affordable housing is not on the main development site but is being provided elsewhere. All the guidance says is that any affordable housing that is not on the particular site can be taken into account. I hope that explains that. We discussed this quite a bit in Committee but it should be quite clear that this clause relates only to affordable housing. That is the only element that we are seeking to address within this Bill.
Local authorities can voluntarily renegotiate Section 106 agreements already. Under the regulations that have just been laid, they can be required to look at the whole aspect. Often the affordable housing is quite a large aspect of the development obligations and it therefore makes sense not to go through the whole galaxy of the Section 106 review, but to take account of the affordable housing and go through a quicker process.
This is, of course, taken into account against the background of the development plan and has to be reviewed under those provisions together with what was taken into account when planning consent was granted in the first place. The development plans include policies for the delivery of affordable housing to meet local needs. These policies are usually applied in the context of individual site viability. The effect of the clause is to help to deliver these policies by bringing forward viable development; it does not require a revisiting of the plan policies.
The noble Lord, Lord McKenzie, made, I think, a moderate complaint about the fact that the proposals for establishing viability appeared only last night. I recognise that and I apologise that they were rather late. However, they are not very detailed and I think anyone with a lunchtime would have had an opportunity to read them. However, lunchtime does not exist in my life and maybe not in other noble Lords’ lives either, so I understand the noble Lord’s point.
The obligations that we are discussing were probably agreed at the time of the property boom and before the statutory tests for Section 106 were introduced in April 2010. Before then there was no statutory requirement to ensure that obligations were,
“necessary to make the development acceptable in planning terms”.
Therefore, there may be capacity to revisit a range of obligations that were required before the tests were in place.
A full review of all aspects of an agreement could be costly and time-consuming for both parties. We wanted a streamlined review process as a backstop whereby viability is an issue. Affordable housing obligations are often the most expensive element of the Section 106 agreement and are agreed subject to viability. Research from 2007-08 found that about 50% of all planning obligations were for affordable housing so this is quite a significant area. That is why we have focused on only the affordable housing element of a Section 106 agreement in the Bill. For obligations agreed since April 2010, the statutory tests should ensure that the local authority can require only those items that are,
“necessary to make the development acceptable in planning terms”.
Our approach will safeguard essential mitigation measures, such as transport, open space and education provision, which are required for the scheme to go ahead, and would be part of the overall Section 106 agreement but would probably take a great deal longer to negotiate. To open up the clause to these other obligations would add complexity to the review and could make the development unacceptable in planning terms.
I turn now to community infrastructure levy payments, which I am not sure the noble Lord, Lord Shipley, mentioned but my noble friend Lord Jenkin did. It is not very helpful to bring them into consideration here. The community infrastructure levy is non-negotiable so it cannot be taken into account as it cannot be renegotiated. The levy is up front—developers know what they will have to pay and it is predictable. It is set at the local level in accordance with local viability. Local authorities do not have discretion to waive or reduce the community infrastructure levy once the payments are set. The regulations make provision for exceptional circumstance relief but only subject to very strict criteria.
With those explanations and going back to the indication that this clause relates only to affordable housing in this Bill, that Section 106 agreements can be renegotiated voluntarily and that the regulations for post-2010 are now in place, I hope noble Lords will realise that there is a package here and will not press their amendments.