Sir Nicholas Soames: To ask Mr Chancellor of the Exchequer, if he will grant councils the freedom to invest in local infrastructure in new housing developments.

Elizabeth Truss, Chief Secretary to the Treasury: Local authorities are free to borrow and invest in infrastructure for the benefit of local people without prior government consent, subject to assuring themselves that their borrowing costs are affordable.

Local authorities can secure contributions from developers to fund infrastructure through the Community Infrastructure Levy (CIL) and section 106 planning obligations. CIL is a flat rate charge on new development that local authorities can use to address the cumulative impact of development in their area. Section 106 planning obligations are negotiated agreements between local planning authorities and developers, and can be used to build infrastructure that will make a development acceptable in planning terms.

The government recognises the importance of infrastructure that supports housing. This is why the Autumn Budget 2017 announced a further £2.7bn for the Housing Infrastructure Fund, which supports infrastructure that unlocks housing, taking total investment in the fund to £5bn.

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