Developers failing to cough up community benefit payments

May 17, 2011 2 Comments »
Developers failing to cough up community benefit payments

severn grove

Communities across Cardiff are missing out on vital funding to improve their areas, we can reveal today.

Nearly £250,000 remains unpaid by developers to Cardiff council for developments which have been completed for two years or more.

Residents in Grangetown are still waiting on a £60,000 kick-back from the Celtic Gateway development, completed in 2006, to fund a new bus service.

In Plasnewydd, 20 new flats on Albany Road – built by Pan Maritime Ltd in 2009 – have not coughed up £30,582 for improvements to public open spaces.

Grangetown councillor Francesca Montemaggi said she was surprised the developers hadn’t paid.

She said: “When you have such a big development it’s a tiny amount for them to pay.

“It’s a growing area, around Dunleavey Drive and we need to make sure services, like the bus service, are in place to meet the increase in population.”

A total of £244,316.20 is missing from the council’s accounts, with some developments built in 2004 – such as new accommodation on Newport Road, Adamsdown – still not settling their accounts.

Chair of Cardiff Civic Society, Peter Cox, who made the Freedom of Information request, said the council needed to review its system.

He said: “There needs to be a better system for getting this money, it’s been outstanding for too long.

“The developer is getting the planning gain but what are the community getting? Maybe we need to see a system where when the consent is given the cheque for community benefit is handed over at the same time.

“After all you can’t put your car on the road without paying the car tax, can you?”

Canton councillor Richard Cook said chasing up Section 106 money is important for councillors to do.

He said: “I keep a spreadsheet of all the applications and how much is owed.

“It’s up to councillors in a way to ensure the money is spent in their ward. Here in Canton we’ve had a whole new park because of the Lansdowne Hospital.”

Cardiff University – who are developing a new medical education centre at the University Hospital of Wales – owe £3,328 in transport improvements.

A university spokesman said: “We are unaware that an invoice has been received for this amount. There is no issue regarding payment of this amount and can be paid as and when required. Further to this inquiry, Cardiff University will now seek to make further enquiries to ensure no payment has already been made. If this proves to be the case, we will seek to contact Cardiff council to request an invoice and make the necessary payment.”

A Cardiff Council spokeswoman said: “Cardiff council legal department are actively pursuing the parties for payment.

“Each individual case is different, in that the planning consent and legal agreement runs with the land, and has unique trigger dates for payment of financial contributions.

“Each agreement is confidential to the parties and each has different terms. Some have the planning gain being payable on the commencement of the implementation of the building works whilst others are dependant on completion or occupation of the development.”

What are Section 106 orders?

Section 106 is part of the Town and Country Planning Act (1990) which allows local planning authorities to agree contributions, arrangements and restrictions relating to developments.

It allows money to be paid by developers to offset the costs of the exteral effects of development. For example, if a developer wants to build new flats and takes away a playground, the local council could order the developer to pay for the cost of a new playground.

Full list of outstanding Section 106 payments

38-42 Newport Road, Adamsdown – conservation of offices into residential accommodation. £40,460.80.

Cadogan House, West Bute Street, Butetown – 22 flats and restaurant. £15,403 for open space and £5,610 for new bus stop.

Celtic Gateway, Dunleavy Drive, Grangetown – New office development, over 5000m2. £60,000 for new bus service.

Coryton House, Whitchurch. Conservation of existing building into school for autistic children with residential care home. £14,568 for open space.

107-109 Severn Grove, Riverside. 13 self-contained flats and two cottages. £23,808.

Albany Road, Plasnewydd. Construction of 20 self-contained flats. £30,582 for open space and bus boarder.

Former Forge Garage, Cowbridge Road West, Ely. Construction of 78 bed nursing home. £6,240 for CCTV.

Youth Cymru Training Centre, Sachville Avenue. Construction of new four storey residential development. £30,424 for open space and £13,892.40 for bus boarder.

University of Hospital Wales, Heath. Demolition of Radnor House and erection of new medical education centre. £3,328 for public transport enhancements.

View the full Freedom of Information request made by the Cardiff Civic Society and their findings.

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  1. Tony May 17, 2011 at 11:25 am - Reply

    How many of the developers involved have gone bust? The picture shows Severn Grove where the original developer went bust . Is that a reason why no payments haver been made or are the obligations binding on the Surely the Council needs to take money in advance to avoid such problems?

    • Ed Walker May 17, 2011 at 12:15 pm - Reply

      Thanks for your comment Tony. The answer is I don't know, but I suspect a few – as the numbers I had did not work/company names on the applications were marked as dormant.

      As Peter Cox suggested, perhaps the system needs to be reviewed to see more money come to the council in advance.

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