Marlborough's loss of affordable housing money was just the edge of a multi-million pound hole in housing policy
Has the government been serious about supporting the construction of affordable homes using Section 106 money paid by developers building normal residential housing? Marlborough's recent experience and the past record of the Exeter-based consultancy, which boasts the name of "S106 Management", would suggest that it has not been very serious at all.
There has been a great deal of discussion, recrimination and anger over Wiltshire Council's decision to back down on the £334,624 contribution towards affordable housing in Marlborough that developers McCarthy and Stone had been required to pay as part of their planning permission to develop the Granham Hill garage site.
Agreeing to cut this Section 106 contribution has been seen as a slap in the face for Marlborough people who cannot find affordable homes. Coming next will be debates over the Section 106 money due from the developers of the very much larger Salisbury Road housing scheme - for 175 homes and including 70 affordable homes.
Section 106 money has been fixed for this development at the stage of Outline Planning Permission. It includes a £700,000 investment in St John’s Academy, £80,000 towards the local GP surgery, highway enhancements including pedestrian crossings, cycle paths and footpaths to the town.
The Crown Estate is in the process of agreeing the sale of this large green-field site to a developer - whose name is yet to be announced. It will be interesting to see whether the buyers of this site and of its outline planning permission will try to get the Section 106 payments reduced or cut. Perhaps they will use the consultancy S106 Management to help them.
A whole industry grew up around developers' challenges to 106 payments. S106 Management was set-up by Robin Furby - a solicitor who became a developer. Their website says they could - in past months - "establish the profitability of your project and thereby reveal unviable Section 106 obligations."
S106 Management reckon they have helped a developer avoid charges like the affordable homes contributions "If the profit margin for your scheme is pushed to below 17.5 per cent by Section 106 payments..."
There is a 'Case Studies' section on their website that proves what their worth has been to developers. Among their successes for developers due to pay towards affordable homes they have saved: in Hackney a £1.8m payment, £500,000 in Wallingford, £4m at Redruth in Cornwall, £730,000 in Virginia Water in Surrey, £1m on a brown field site development at Grays in Essex, - and so on.
Their latest case history is dated December 2015 - and the changes in government rules that allowed McCarthy and Stone's Section 106 appeal through have now lapsed.
The Section 106 charges should be being replaced by the Community Infrastructure Levy (CIL), which became law under the Planning Act of 2008 and came into force in April 2010 but only came into effect in Wiltshire in May 2015.
It is a non-negotiable fee based on a percentage of the development budget paid by developers to the local authority to help pay for infrastructure improvements that are required to cope with the increase in an area's population. Eventually part of it will be payable directly to town councils.
With regard to the Salisbury Road 106 charges mentioned above, it is worth noting Wiltshire Council's draft Infrastructure Delivery Plan (2011-2016) for the Marlborough area, which was published in February 2016.
Among its list of 'essential' schemes is a 99-place extension to St John's Academy (priced at £2,162,522.) There is mention of improvements and extensions to GP practices in the villages. But there is no mention of the Marlborough Medical Practice, which will have to cope with extra patients from the Granham Hill flats, the Salisbury Road and - perhaps - the future development north of Barton Park.
Speaking of the latter, the delivery plan does list the 'essential' spend of £1,789,587 for the relocation of Preshute Primary School. Can anyone really build a new school for that sum of money? Or is Wiltshire Council relying on someone else footing that bill?