Westminster City Council introduces new developer contribution for major developments

09 May 19 | Lewis Westhoff

Westminster City Council have announced that it is introducing new Inclusive Local Economy and Employment Guidance that will be effective from 13 May 2019

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Westminster City Council have announced that it is introducing new Inclusive Local Economy and Employment Guidance that will be effective from 13 May 2019. The Guidance sets out how new developments will be subject to a new a financial contribution towards local employment, training and skills.

Under the Guidance, major development proposals that deliver over 50 residential units or over 1,000 sqm of commercial floorspace will now be expected to make a financial contribution towards local employment and training initiatives. Proposals that deliver over 100 new residential units or over 10,000 sqm of commercial floorspace will be expected to produce an Employment and Skills Plan in addition to making a financial contribution.

The Council’s indicative charge for commercial and residential development is based on the occupancy level of the development type, the worklessness rate in Westminster and the costs to place an individual into sustained employment. The financial contribution would be secured via Section 106 legal agreement and would apply to net additional floorspace.

The indicative rates for commercial and residential land uses are:

• Commercial uses – £32.41 per sqm GIA
• Residential uses – £4.88 per sqm GIA

The new guidance will now give officers at the Council the means by which to levy this developer contribution and it is expected that this new charge will be formalised within the Council’s new City Plan and associated supplementary planning documents (SPDs).

This new charge will add to the growing number of developer contributions that are levied on new development. Westminster City Council have some of the highest local Community Infrastructure Levy (CIL) rates in London and the recent introduction of the Mayors new CIL charging schedule has seen significant increase in Mayoral CIL charges.
Additionally, the requirement to produce an Employment and Skills Plan for larger schemes will require applicants to make commitments regarding the number of work experience placements, apprenticeships and sourcing of local employees at the planning application stage. This Plan has traditionally been required via a pre-commencement condition or planning obligation; however, the new Guidance means that applicants will now need to engage with contractors about employment commitments before a scheme achieves planning permission.

Should you have any questions regarding the new Employment Guidance, please contact Iceni’s Central London Planning Team.

A copy of Westminster’s new Guidance can be found here.

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