Community Infrastructure Levy: Homeowners

Gregory Stafford Excerpts

Wednesday 29th April 2026 Westminster Hall

[Gregory Stafford (Farnham and Bordon) (Con)]

It is a pleasure to serve under your chairmanship, Mr Turner. I congratulate my right hon. Friend the Member for Godalming and Ash (Sir Jeremy Hunt) on securing this debate. I have applied for a similar debate twice, but clearly I do not have the touch of a former Chancellor in the Westminster Hall lottery.

This is a very serious issue. The community infrastructure levy is meant to be simple: developers contribute and that money is used to fund the infrastructure that communities need. That is the principle, and that is the promise, but in parts of my constituency that promise is being broken. The regulations are clear that CIL is intended to support growth through infrastructure, yet we see millions of pounds collected and sitting idle, with little evidence of delivery. The rules exist but the action does not follow.

In Waverley where, as we have heard, CIL rates are among the highest in the country, substantial sums are being collected and left unspent—£30 million when we last checked at the beginning of the year. That alone undermines public trust, but the reality is worse than that. The money does not simply sit there; it accrues interest—£125,000 a month in Waverley’s case. That interest is not ringfenced for infrastructure; it is absorbed into the general council spending. It is equivalent to 10% of council tax in Waverley’s case. Residents are told that the money is for community facilities when in reality it is sitting in accounts, quietly supporting day-to-day council spending.

At the same time, inflation is eating away at the value of the original CIL pot, so when the council does eventually spend it, it delivers less than it should. Communities lose twice: the infrastructure does not arrive and the money set aside to fund it is steadily diminished.

Worse still, the system is being misapplied. Of course, it is right that developers should contribute, but individual homeowners making changes to their own properties were never intended targets of the regime. Pursuing them aggressively, as Waverley borough council does, is not just heavy-handed; it is plain wrong. Let us call it what it is: a cash grab.

CIL may be a national framework, but it is administered locally. The contrast within my constituency could not be starker. In East Hampshire, charging rates outside the regeneration zone in Whitehill and Bordon range from £95.94 to £265.68 per square metre. Even with a manual exemption system, the council actively supports residents, contacting them repeatedly by letter, email and phone to make them aware of exemptions, guiding them through the process and clearly warning them of the consequences of failing to submit the correct forms. That is what good administration looks like.

Let us compare that approach with that taken by the Liberal Democrat-run Waverley borough council. There, the CIL rates charged to affected homeowners are among the highest in the country. In Farnham, they stand at £547.17 per square metre, rising to just under £570 per square metre in Haslemere and the surrounding villages.

With those high rates comes a very different approach. I have been contacted by a number of constituents who together face CIL liabilities of nearly £1 million. They are not developers; they are ordinary residents who feel blindsided, misled and, in some cases, harassed. They are being charged for exemptions they were never supposed to pay. That is not administration. That is extraction.

The response from the Liberal Democrat leadership, supported for too long by the Farnham residents group, has been one of inertia and, frankly, contempt. Instead of being helped to navigate a complex system, residents have been left in the dark and presented with life-changing bills. This is not fairness; it is the politics of envy in action, and my constituents are paying the price.

Let me give some examples. One constituent who lives on the Surrey-Hampshire border has an East Hampshire postcode but her property falls within Waverley. She was hit with a £48,000 charge, which has now risen with interest to £60,000. In Haslemere, another constituent received a £94,000 charge because an agent failed to submit the correct forms. He was forced to put his home on the market, with the only alternative to divert the majority of his pension to pay the bill.

In Lower Bourne, a couple were issued with a £54,000 charge two days before Christmas in 2024. That led to delays and additional restart costs of between £15,000 and £20,000. Also in the Bourne, a resident faces a charge of £150,000. In Moor Park, another faces a charge of close to £100,000, triggered by a mid-project planning amendment.

Even minor administrative issues are treated with zero flexibility. A Farnham resident now faces a £25,000 charge, along with £5,000 in legal costs, following a change-of-use application for a granny annexe. These are not speculative, rapacious developers; they are people improving their homes, supporting their families and planning for their futures. The human cost is real and growing.

As has been pointed out, last year my right hon. Friend the Member for Godalming and Ash and I met the Minister to discuss these issues. At the time, he appeared sympathetic, so I ask him today: what progress has been made? At that meeting, we urged the Minister to issue clear guidance to local authorities to prevent further harm while the regulations were reviewed. Unfortunately, that idea was not taken forward. I understand the concern about overreach, but what we are seeing now is not restraint; it is injustice.

I support my right hon. Friend’s proposed solutions. With that in mind, I ask the Minister three fairly straightforward questions. First, what progress has been made on reforming the CIL regulations? Secondly, will he issue clear guidance to ensure that councils do not exploit the rules to the detriment of ordinary homeowners? Thirdly, will those who have been wrongly charged be refunded? Under the current system, once development has commenced, there is effectively no right to appeal. It is a rigid and unforgiving mechanism. Most councils choose not to wield it in this way, but Waverley borough council has.

The spirit of the law is being ignored, and the balance has been lost. My constituents are being treated not as residents to be supported, but as revenue to be extracted. This is not what the levy was designed to do. It was meant to build stronger communities, not penalise them. The law may permit what is happening, but it was never intended to enable it. It is time we put that right.

--- Later in debate ---

[Gideon Amos]

My hon. Friend is absolutely right that the Government should do that. There have been opportunities to do something about this; there are opportunities to change the law. He seems to have read the later part of my speech, and is quite right to mention our hon. Friend the Member for Newbury (Mr Dillon), who not only made that point in respect of that Bill but brought it to the attention of the Select Committee last year. Liberal Democrats in Parliament have been trying to get resolution and a change in the rules.

In Waverley, the council has gone further than the law requires. It has set up a discretionary review process, opening a few weeks from now in June, for householders who believe they have been wrongly charged. That is the right thing to do, acting within the limits of what the law allows it to do. But the council can only act up to and within the bounds of the law, which is rigid.

[Gregory Stafford]

Before the hon. Member moves on, I should correct what he said: CIL was introduced in Waverley in 2019, and the Liberal Democrats took over the council one month later. The idea that the Conservatives brought it in is utter nonsense. The Liberal Democrats have now had seven years to try to fix it, and they have not. I ask the hon. Member to use his influence on his fellow Liberal Democrats to encourage them to operate a system far more like those in other parts of the country that we heard about from my right hon. Friend the Member for Godalming and Ash (Sir Jeremy Hunt), which operate with more flexibility.

[Gideon Amos]

The amount of flexibility that can be exercised depends on the nature of the error in the process that is being discussed, so not every council can operate the same redress in the same situation. The hon. Gentleman confirms that it was a Conservative administration that drew up the CIL charging schedule, the forms and all the processes that underlie and guide—in fact, not just guide but narrowly dictate—how the council exercises control over CIL. Where the hon. Gentleman is right is that the rules need to change. The best way to change them would be to change the regulations in this place.

That brings me to the Minister and the Government. The Minister has said, including when my hon. Friend the Member for Newbury raised the issue, that CIL was never intended to be applied in this way, and I believe he is right. He has named the Liberal Democrat authority in West Berkshire as a good example of exercising discretion where the law allows that to be done, but naming good examples is not enough, and we need to do more.

We need three things from the Government on this issue, and we need them in this Parliament. We need a statutory definition of what constitutes a minor administrative error, so that homeowners are not penalised by tens of thousands of pounds for a missed form. We need a statutory right of appeal against CIL charges, with clear limits for resolution, and a clear lawful basis on which councils can waive or refund charges in cases of genuine homeowner error. Currently, that option can be exercised only in certain cases, depending on the nature of the error involved. I am grateful that the Minister has indicated in previous discussions that the Government will act, but we need to see action.

While on the subject of CIL, we should be honest about the wider problem. All the Members who have spoken—I think they have all been hon. Gentlemen—were right that it is necessary to fund infrastructure, so the rationale behind CIL is worth while. As the hon. Member for Farnham and Bordon (Gregory Stafford) pointed out, the CIL funds do need to be spent on delivering infrastructure.

The levy is a flat rate per square metre and bears no relation to the level of the uplift in land value before and after planning permission is granted. I confess that back in the 2000s when the measure was being put forward, I was part of a lively debate with bodies such as the British Property Federation, arguing that the levy should relate to the level of land value uplift. In some parts of the country, where we have clear viability challenges, there is very little land value uplift. The same level is charged as on a site with a massive land level uplift, where there is no viability problem. The state is missing out on land value uplift in places and the CIL is affecting viability in other places. We would suggest that the Government move towards a levy that relates to the land value increase that the landowner is gaining. That is necessary to fund schools, surgeries, GPs, roads, and all the rest of it.

The Minister is reportedly looking at the levy again; I urge him to be ambitious and make the changes we are arguing for. Patching the exemption rules is necessary, but it is not sufficient. The injustice that constituents are facing is real—we agree on that—but the schedule put in place by previous parties is what has guided Waverley’s actions. The council is doing what it lawfully can to address the issue, but the Government need to do the rest.