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Response to Greenwich Council Community Infrastructure Levy consultation

A Community Infrastructure Levy (CIL) is a charge collected from property developers and landlords who create housing and commercial space, used for the benefit of the local community where the development is sited.

This is Greenwich and Bexley Green Party’s official response to Greenwich Council’s consultation upon proposed changes to the Community Infrastructure Levy.

Our Response

The suggested Community Infrastructure Levy (CIL) charges are too low and do not strike the right balance between viability and local infrastructure needs.

The Royal Borough has seen sustained growth in housing prices of over 25% since the last CIL Review in 2015 (see figure 2.13.1 of the council’s viability assessment).

Chart showing increase in average house prices in Greenwich increasing from around £225,000 in 2007 to around £450,000 in 2022.

Much of this increase has been driven by significant amounts of very expensive housing in riverside parts of the Borough.

The Council’s proposal recovers only 1.5% of the sale price for community investment

The viability assessment shows sales value per square foot reaching between £800 and £900 per square foot across the riverside areas of Greenwich Creekside, East Greenwich, Peninsula and Woolwich Arsenal.[^1]

Converting to square metres for convenience (1 sq. m = 10.7639 sq. ft.) this is a value of over £9000 per square metre in riverside parts of the Royal Borough. The Council’s suggested new Zone 1 Residential CIL rate of £150 per metre in these riverside areas is simply inadequate given the scale of profits that property developers are making in these places. 

Sales value per square foot in Greenwich, indicating levels between £550/sq.ft. in the eastern and southern parts, to £900 per square foot in Greenwich Peninsula.

The suggested CIL rate also underestimates the level of community need for infrastructure investment. Riverside areas have seen very high rates of development in recent years, but this has not been matched by adequate investment in the community.

Local residents have faced many years of sustained disruption and squeezed infrastructure. Parks and recreational areas have not been invested in and disability, older adults’ and youth services have been overstretched. We anticipate further strain on community infrastructure, because more developments are planned in these areas over the next five years (especially in Greenwich Creekside along Deptford Creek, Morden Wharf at East Greenwich and in Greenwich Peninsula).  

Greenwich and Bexley Green Party believe a higher rate of CIL should be instituted and collected across a wider area of the Borough:

  • We propose that a more appropriate balance between viability and community need could be struck in riverside areas by a ‘Zone 1a’ Residential CIL rate of £250 per square metre. This should apply in Greenwich Park, Greenwich Creekside, East Greenwich, Peninsula and Woolwich Arsenal wards. It would ensure a CIL rate to sales value ratio of around 1:10, which is a reasonable benchmark figure used elsewhere in London. 
  • We propose that the Charlton Village and Riverside ward be moved to Zone 1. This anticipates the scale of riverside housing growth expected there.
  • We propose that Abbey Wood be moved to Zone 1. The impact of the Elizabeth Line station and the associated housing growth needs to be taken into account in collecting CIL rates. 

The comparatively low level of CIL collected by Greenwich can be seen clearly in the following chart:

Chart displaying CIL rates collected by different London boroughs as of August 2022.

The Council has no proposal for adjusting CIL rates on other land uses

It is disappointing to see no change proposed to student accommodation, hotel supermarkets and superstores and retail warehousing CIL rates.

The value of land in Greenwich for these purposes has increased considerably since 2015 because of general housing price growth, the introduction of the Elizabeth Line and the development of the Silvertown Tunnel for HGV transportation.

CIL rates should be uplifted in these categories. This will strike a better balance between the increased profit made by these land uses and the impacts of the increased associated activity on local residents.

For example, the epidemic of new retail warehouses that are planned around Peninsula ward to take advantage of the Silvertown Tunnel will result in much more disruption for local residents: worsened air pollution, increased traffic, increased noise levels. CIL should be increased to pay for mitigation measures to address this.

  • We propose that the ‘all other uses’ CIL category be split into a ‘high impact other use’ category with increased CIL rates and a ‘low impact other use’ category with flat CIL rates. This will help promote sustainable local businesses, while ensuring that compensation is secured where land is used in ways that do not contribute to achieving the council’s own environmental transformation goals. Example of high impact uses would include large car parks, lorry parks and high-emission industrial and retail activities, including fast food takeaway businesses relying on motor vehicle transport. The ‘high impact other use’ category would also reflect the increased impact on local residents.

The Council has allowed the gap between community infrastructure and new development to become a chasm

Overall, the CIL charging review should be seen in the context of a decade when the Royal Borough has failed to review its CIL rates in a timely manner.

Failing to recover proportionate CIL has resulted in gap between new development and the necessary mitigatory infrastructure widening in communities across the Borough.

Ambitious measures must be introduced as swiftly as possible to urgently close this gap, so that residents can enjoy the health, sustainable transport, youth and green infrastructure facilities they deserve.