Purpose

The Council adopted the current Tower Hamlets Community Infrastructure Levy (CIL) Charging Schedule in April 2015, followed by a revision in 2020. Since then, development patterns and land values have evolved significantly. A new viability assessment commissioned in 2024 has demonstrated that certain uses, particularly Research & Development (Use Class E(g)(ii)) can support a CIL charge without undermining development viability.

This paper seeks approval to undertake public consultation on proposals to revise the 2020 Tower Hamlets CIL Charging Schedule, to include a new rate of £117 per Square Metre (Sqm) of CIL liable development for Research & Development uses in the borough.

The Council has ensured that the proposal for the new rate is informed by appropriate evidence, is viable, and aligns with the adopted Local Plan.

Decision

1. Approves the Draft CIL Charging Schedule – partial review and supporting evidence for a 6 week public consultation (shown in Appendix 1 for LBTH Draft CIL Charging Schedule – partial review).
2. Approves the proposed consultation strategy for the Draft CIL Charging Schedule, in accordance with the Community Infrastructure Levy Regulations 2010 (as amended). (shown in Appendix 4 for CIL Statement of Representations Procedure)
3. Authorises the Corporate Director of Housing & Regenersation in consultation with the Mayor to:

•         Approve minor modifications to the Draft Charging Schedule (“DCS”) following the public consultation.

•         Where no material modifications are required following the consultation on the Draft Charging Schedule – partial review, to approve the submission of the Council’s proposed Charging Schedule – partial review and associated evidence base for public examination.

1. Note that if material modifications to the Draft Charging Schedule – partial review are required following consultation, that approval to undertake a subsequent consultation or submit for public examination as necessary will be referred to the Mayor in Cabinet.
2. Notes the supporting evidence base produced to support the Draft Charging Schedule – partial review, meaning:

•         Appendix 2 – LBTH Research & Development CIL Study

•         Appendix 3 – CIL Funding Gap Statement - R&D review

1. Note the Equalities Impact Assessment Screening shown in Appendix 5 of the report submitted.

Reasons for the decision

The decision to approve public consultation on revising the CIL Charging Schedule to include a specific rate for R&D uses is driven by the need to ensure that the borough’s infrastructure funding mechanisms remain responsive to evolving land use patterns and economic priorities.

Tower Hamlets is experiencing increasing interest in R&D-led development, particularly in areas such as life sciences, technology, and innovation. These sectors contribute to the borough’s long-term economic resilience and diversification, and their growth presents both opportunities and infrastructure demands. However, the current CIL Charging Schedule does not differentiate R&D uses from other commercial categories, potentially leading to under-collection of contributions from developments that place unique pressures on local infrastructure.

Introducing a tailored CIL rate for R&D uses will:

•         Reflect the distinct nature of R&D developments: These uses often have different spatial, employment, and infrastructure impacts compared to traditional office or industrial uses.

•         Ensure fair and proportionate contributions: A specific rate will help secure appropriate funding from R&D developments to support the infrastructure needed to accommodate them.

•         Support strategic planning objectives: The revised schedule will align with the borough’s Local Plan and economic development strategies, which promote innovation-led growth.

•         Enable meaningful stakeholder engagement: Public consultation will provide transparency and allow developers, businesses, and residents to contribute to shaping a fair and effective charging framework. 

Alternative options considered

Retain the adopted Charging Schedule with R&D uses remaining as a nil charge and do not undertake a public consultation on the draft amendment to include a new R&D charge.

Not consulting on amending the CIL Charging Schedule to introduce a specific rate for Research and Development uses is not recommended because it would leave the borough’s infrastructure funding mechanisms unresponsive to the growing presence of R&D-led developments. Without consulting on the potential of a tailored rate, the borough risks under-collecting contributions and missing strategic planning opportunities.