Planners have welcomed the government's about-face on planning gain and its replacement by a charge set by councils according to their infrastructure needs.
Housing minister Yvette Cooper said the charge would be paid by developers in proportion to the demands their project makes on roads, schools, sewerage, community facilities or other infrastructure.
Ministers have abandoned the proposed nationally set development tax, planning gain supplement (PGS), denounced by councils and developers as unworkable (LGC, 11 October).
Under the new proposal, money would be spent by the council in whose area it was raised. Negotiations over individual projects would continue only to fix developer contributions to affordable housing and site-specific infrastructure.
Ms Cooper said: "We need a new and fairer system which increases the investment for infrastructure, while supporting new houses and jobs."
Councils would encourage development because they would see a direct financial benefit from it, she said.
It is not clear if there will be restrictions on what councils can charge or how much is reserved for regional-scale projects.
Planning Officers Society president Steve Quartermain said: "We are very pleased the government has dropped PGS in favour of local charges.
"We still have the issue of money top-sliced for regional projects and must look at that."