Rural areas missing out on valuable contributions from new development

A common complaint planners like me hear when proposing or assessing applications for new homes is: ‘I can’t get a GP appointment now, so what’s going to happen when you add [insert relevant number here] of new homes?’

In other words, there is a perception that existing services and transport infrastructure are already stretched and will become overburdened by the addition of new homes in the area.

Infrastructure strain and unmet developer promises

Ideally, the planning system should prevent this. It should ensure new homes and residents are properly planned for, with developers contributing to improved infrastructure—like new roads, hospitals, and schools—as required. However, residents often find these commitments aren’t delivered. The planning system frequently fails to secure these improvements. There is plenty of evidence to back this assertion. New residents in Hampshire dealt flooded roads and insufficient drainage. In Bedfordshire, new residents were provided within inadequate pedestrian crossings leading to highways safety concerns. Residents in Cambridgeshire remain without the shops promised and in Essex without access to the playground, nursery or shops that were presented on the estate agent’s brochures. Meanwhile, research undertaken last year by Wild Justice, found that developers delivered only 53% of promised ecological enhancements.

Nevertheless, the government labels people who raise these concerns as ‘blockers’ and accuses them of opposing economic growth. Powers to ensure public engagement in the planning process are now being scaled back in the Planning and Infrastructure Bill, even though many objectors would support new housing if public services and infrastructure were provided up-front and nearby. Polling by CPRE in 2024 showed strong support for this. It found that 66% of respondents would support new homes built in their area if they were close to services and public transport; a 16% rise from those who would support more housing in general.

Challenges in funding and managing Community Infrastructure Levy (CIL)

To try and address the problem, the government introduced the Community Infrastructure Levy (CIL) in 2008 to help secure funding for important infrastructure relating to new developments. CIL was proposed to replace burdensome and expensive legal agreements between authorities and applicants, known as Section 106 agreements, and create certainty for planners, developers, and the public. However, it created a new ‘twin-tracked’ system of CIL and S106 in areas where CIL was adopted. In areas where CIL has not been adopted, S106 remains the only tool available to planners to secure necessary infrastructure funding. This means some are losing out on valuable funds, as commitments in S106 agreements are up for negotiation and not mandatory.

In line with this, new research by CPRE found that half of rural authorities do not currently charge CIL on new developments. Out of 10 National Park Authorities that have planning powers, only one had decided to charge CIL.

This highlights how rural authorities struggle to navigate the system and often miss out on vital funding from new developments. National Park Authorities and particularly rural areas tend to see lower development levels, raising concerns that CIL charges could reduce building even further. There are also costs to managing CIL. When potential income is low, many authorities decide it’s not worth the effort. Additionally, many councils lack an up-to-date Local Plan, which is essential for charging CIL. So, they’re unable to apply it at all.

Of the rural authorities that did charge CIL, CPRE found some discrepancies between the amount owed, collected, and allocated for the reporting year. Reporting from Infrastructure Funding Statements showed that authorities had funds owed from demand notices, but CIL receipts for the year were significantly less.

For example, Horsham District Council reported a total value of £3,101,096.11 from demand notices for 2024 but only had a total amount of £1,177,014.36 from CIL receipts. This is a funding gap of £1,924,081.75 of uncollected receipts. On top of that, they had a total of £6,142,171.10 in CIL funds collected before 2024 that still hadn’t been allocated to any infrastructure project. Somerset Council reported a total value of £8,894,543.55 from demand notices for 2023/24, but only collected £4,740,340.43. This equates to a gap between funds owed and collected of £4,154,203.12. The Council also reported the amount of CIL monies retained for future spending was £21,512,851.35. West Lancashire Council reported that the total value from demand notices for the period of 2023/24 was £5,446,820.74, yet the Council only collected £3,498,814.45; a gap of £1,948,006,29.

Reasons for lack of or slow collection of funds owed are similar to reasons for slow take-up more generally. Resourcing within planning departments is a critical issue. Many councils do not have the capacity to chase money owed to them and rely on developers to submit the correct forms on time in line with the regulations, which does not always happen. Difficulties with allocating funds for projects can also be attributed to a lack of resource. In addition, particularly large or complex infrastructure projects often require greater investment, so councils will hold on to funds until a sufficient amount can be allocated. This is not captured by annual reporting and slightly distorts the picture.

The result of all this is a burdensome system for developers and planners to navigate, which is failing to deliver the infrastructure promised. As a result, trust in the planning system continues to erode. In rural areas especially, the system isn’t working for authorities that urgently need new, affordable homes.

The government are looking at planning reform, primarily to speed up the provision of new homes. However, it’s unlikely the new Community Infrastructure Levy (CIL) measures in the Levelling Up Act will be implemented. Still, reform is essential. CPRE are calling on the government to address the specific challenges rural authorities face. Planning departments must have enough resources to collect, manage and spend development funds effectively. National policy should set clear expectations for new homes to help create great places, not just monotonous housing estates. Locally, Neighbourhood and Local Plans should identify infrastructure required and ensure allocated sites meet minimum requirements. CPRE supports building more homes for those in need, but only with the right infrastructure in place. Without it, everyone loses out.

References

We have compiled data and information from the following sources:

• CIL watch: Community Infrastructure Levy | CIL Watch | PlanningResource
• Infrastructure Funding Statements published by rural authorities found on their websites
• ONS Rural-Urban Classification: 2021 Rural Urban Classification – Office for National Statistics
• Information relating a lack of services and/or infrastructure in new residential developments:
• ‘Thousands of homes being built in England without schools, shops and doctors’ | Planning Resource,
• ‘No shops, no schools’: homes in England built without basic amenities | Planning policy | The Guardian,
• Centre for London | Why People Oppose New Residential Developments in Their Back Yard,
• Housing developers accused of failing to deliver vital infrastructure, from GP surgeries to green spaces | The Independent,
• Unadopted Roads: New Housing Estates – Hansard – UK Parliament