Council Creates Development Investment Fund to Help Tackle Inequality

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Sheffield City Council’s Cabinet have agreed to change how money collected from the Community Investment Levy (CIL) is invested in local communities, creating a new pot of funding that will be spread fairly across all of Sheffield.

CIL is a tool for local authorities to deliver infrastructure to support improvements in an area. Since the Council began charging CIL in 2015, developers can be liable to pay a charge, or ‘levy’, when building in an area.

15% of this levy goes into a neighbourhood pot. This money is then used to support local infrastructure needs. The money agreed and collected in this portion currently stands at around £1.5 million and the Council wants to invest this to ensure that there is the right infrastructure to support the city’s continued development.

Labour, who has overall control of the Council, started a public consultation about spending the money in a fairer way across the city, to direct funds to the communities where they are actually needed. It was also argued by Labour councillors that land values are lower in many less affluent areas and therefore they receive very little in CIL funds, and sometimes none at all.

The approach agreed by the Council’s Labour Cabinet ensures that every area of the city receives investment, based on a fair and nationally agreed formula.

The Council led consultation ran for five weeks and had hundreds of respondents. There was backing for Labour’s proposal and many commented positively on prioritising areas of Sheffield in the greatest need through the Indices of Multiple Deprivation.

There were some objections to the plans, but in total just 30% disagreed with the new redistribution proposal.

Interestingly, there was significant support in areas like Dore and Totley (57% approval) and Fulwood (75% approval), despite the fact these areas have the highest land values are funds collected through CIL.

Commenting on why Labour is changing how these investments are made, Councillor Jack Scott, Cabinet Member for Development and Transport, said:

“At present wealthy parts of the city receive far more Community Infrastructure Levy, but some of the city’s least affluent areas receive less or nothing at all, because land values are lower. In addition, developers are often not required to pay CIL if they are building in areas of greatest deprivation. This is a sensible way to kick-start much needed development, but it means some areas of our city lose out, whilst the wealthiest parts continue to acquire more, making inequality worse.

“Labour’s new approach will help in our ongoing efforts to tackle inequality so that our whole city can benefit from development, not just a few areas. This is by far the fairest way of investing in communities. You would hope that all opposition councillors would get behind these plans, but frustratingly they are not doing so. Thankfully Labour have a fairer, more prosperous vision for Sheffield”.

 

Councillor Jim Steinke, whose team will manage the Development Investment Fund gave his support for the Cabinet report:

“I am delighted that the public consultation has given us the backing to making these changes. Labour has argued that there is a strong moral, and economic, argument for implementing these changes and I am delighted that Sheffield agrees with us.

“I want to reiterate again that Communities that are directly affected by developments will still get what they deserve – new play equipment, green spaces or measures to tackle increased traffic – but we will be able to assess this need more thoroughly, across the whole city.

“It is a shame opposition councillors aren’t supporting this. The Greens are arguing for keeping the neighbourhood CIL money just for the wards with most development in, many of which just so happen to have Green councillors! For instance in City ward, where a lot of recent development has taken place, Green councillors want to keep the CIL money here rather than spend it where it may be more needed more. This is “pork-barrel” politics of the worst kind!”

“It cannot be right that places like Ringinglow and Totley get hundreds of times more than residents in Halfway and Westfield. This is why Labour sought public opinion and now we have their backing we can implement a funding plan for the whole city”.

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