A very similar argument has been used to secure an exemption of C2 retirement accommodation from the Community Infrastructure Levy: that the cost of construction of such units and the fact that living and medical support facilities are an integral part of the offering renders them sufficiently different from standard C3 residential accommodation to justify their exemption from that levy. However, one of the main points raised by developers in this sector is that many of the new-build schemes that supply accommodation for older people are often much more complex than the duality between care homes on the one hand and retirement flats on the other as envisaged in the consultation. In reality, many modern developments in this sector offer a blend, for instance residents in most retirement villages can live independently where possible and when necessary can choose from a menu of services including catering, laundry, cleaning and personal care. As described in more detail elsewhere, these sorts of schemes offering flexible provision of care often fall between two stools for planning purposes; for example, in some settings residents require little care when they first move into the accommodation (undoubtedly a C3 use) but, as their care needs increase, that care is provided within the wider development without the individuals having to move (a class C2 use). Developers will undoubtedly make the case that this uncertainty is unhelpful for the sector and that all seniors housing with care should fall within the RPDT exemption.
Another point raised by some developers is that senior living schemes rarely incorporate cladding so residents in these developments have not, in the main, been affected by this issue. It therefore seems unfair for these developers to be asked to contribute to the cost of resolving problems that have occurred in the mainstream residential development sector. The consultation expressly states that the introduction of these measures does not imply responsibility on behalf of the payers for historic construction defects in relation to cladding, and that the Government recognises that many developers have had limited involvement in the development of high-rise buildings that require remediation and/or have already taken steps to cover the costs of remediation where applicable. It goes on to say that the reason the Government believes it is fair for all developers to be taxed is that they will all benefit from the Government's measures to protect the housing market such as its increased funding for cladding remediation, the 2021 SDLT holiday and the mortgage guarantee scheme. However, some retirement developers consider that the situation is more complicated than this, in that:
- mainstream residential developers have profited historically from the taxpayer-funded Help to Buy programmes, which helped maintain price increases in this sector. By contrast, retirement housing developers were not eligible for this scheme, which increased the feeling among some that it has been hard for this sector to compete on equal terms with mainstream housebuilders.
- If the argument for the tax is that it is a way to share the anticipated increased market confidence and liquidity attributable to Government funding for the resolution of building safety defects, then there should be recognition that not all sectors of the residential development industry will benefit equally from this funding.
- All forms of retirement housing operate in a market which is parallel to the mainstream housing market, not part of it.
More generally, there is a widespread view in the real estate industry that if a residential developer failed to meet the building regulation standards in place at the time of construction them that developer and/or its insurer should fund the replacement of inadequate cladding. However, if it is decided that the building regulations were deficient at the time of build in not prescribing what constituted safe cladding then the Government and its health and safety agencies are responsible for the crisis.
There is also general concern that the new regime might result in a reduction in the supply of retirement accommodation. This would be contrary to the public interest in ensuring an increased provision of housing suitable for the growing elderly population, both in terms of meeting their health and social needs and also releasing family homes through the downsizing process.