Community Infrastructure Levy: Homeowners

Jeremy Hunt Excerpts

Wednesday 29th April 2026 Westminster Hall

[Sir Jeremy Hunt (Godalming and Ash) (Con)]

I beg to move,

That this House has considered the impact of the Community Infrastructure Levy on private homeowners.

Thank you, Mr Turner, for presiding over this debate on an issue that is having profound life-changing consequences for ordinary families across the country. I also thank the Minister for his interest in the issue. Politics can be very tribal, but I have already met him twice to discuss it, both times with Councillor Jane Austin from my constituency—once in July last year and once in December last year, alongside my hon. Friend the Member for Farnham and Bordon (Gregory Stafford). I know he wants to solve the issue.

The community infrastructure levy, or CIL, was introduced for the best of reasons: to ensure that commercial developers contribute towards the cost of the infrastructure needed as a result of their developments. It was never intended as an extra tax on people doing home extensions, and certainly never as a retrospective tax that people are landed with unexpectedly after the event. Most councils understand that, but one or two have ruthlessly exploited loopholes that allow them to punish homeowners, including Lib Dem-run Waverley in my constituency, which charges over £550 per square metre, one of the highest in the country.

But it is not just there. This morning, I heard about a case in Sevenoaks, where the district council pursued a stay-at-home mother relentlessly, in a case championed by my right hon. Friend the Member for Sevenoaks (Laura Trott). For many families the consequences have been devastating. Some have been forced to sell or remortgage their homes, and the financial burden, alongside the stress and uncertainty, has been immense. Some have fought their councils for years, hitting brick walls at every turn. I am aware of 15 families in Waverley alone who faced unexpected charges, ranging from £26,000 to £235,000.

There are now more than 100 known other cases across the country. Here are some examples: Steve Dally and his wife Caroline have been forced to remortgage their home to pay a £70,000 CIL charge on a home extension in Godalming. As they explained to me and local councillor Jane Austin, they are not developers; they simply extended their home. They hit a brick wall when they challenged Waverley and had to risk additional penalties and compounded interest in the process.

Another Godalming couple were hit with a £70,000 bill because they were living in rented accommodation while their home was being renovated. In Milford in my constituency, a homeowner was forced to pay a £120,000 CIL bill when forced to submit a retrospective planning application because two walls of his existing home fell down. For failing to give notice of the walls falling down he was charged £2,500 in penalties because he had failed to submit a commencement notice, something he had never heard of.

Enton resident Helen Grant reluctantly settled a £56,000 CIL charge on the family home, only to be sent a bill for a further £3,000 in interest charges when the council reviewed her case, which had already been closed. It is not just Waverley; I pay tribute to the CIL Injustice Group, which operates across the whole country. Many of its members are watching from the Gallery today, including people from Wokingham, Tonbridge and Devon.

[Jim Shannon (Strangford) (DUP)]

I thank the right hon. Member for bringing this issue forward. I remind him of the cautionary tale from Northern Ireland. We operate without a CIL-style levy. Instead, we rely on bespoke section 76 agreements, which avoid the tax-like rigidity of CIL. That has left us in Northern Ireland with a multibillion-pound funding gap for infrastructure—specifically, for our waste water systems—which is now halting thousands of developments across 25 cities and towns in our 11 council areas. Does he agree that we must ensure that this measure is not just a sales tax on development value but a ringfenced guarantee for the specific pipes and roads that make those homes habitable? The cautionary tale from Northern Ireland is an example of where this has gone wrong.

[Sir Jeremy Hunt]

I thank the hon. Member; he always makes very thoughtful contributions. He makes two very important points. The first is that we do need developers to contribute towards infrastructure costs. The risk of the appalling injustice that I am drawing attention to today is that we lose social consent for very important contributions that enable much-needed infrastructure to be built. Secondly, he is absolutely right to say that not having CIL at all would be very bad. In my area in particular, there is constant concern about the lack of infrastructure to keep pace with new housing developments.

I want to return to the CIL Injustice Group, because their accounts are extremely concerning. Some are nervous about dealing with their council because of the bad way they are treated. Others spend thousands of pounds on legal fees, often unsuccessfully. Part of the issue is that CIL is an extraordinarily complex process. Forms must be filled in in the correct order and are subject to strict timetables. Even professionals struggle. It is very unforgiving if someone gets it wrong. They have to pay within 90 days, under threat of seizure of assets and imprisonment, and if they do not comply, they get slammed with thousands of pounds in late charges and interest on top of that. There is effectively no right of appeal, and most importantly, there is no ability to correct errors. Ordinary homeowners inevitably do make errors, but there is no latitude in the system to allow them to correct those errors.

[Richard Foord (Honiton and Sidmouth) (LD)]

Does the right hon. Member share my view that when the community infrastructure levy was introduced, it was not designed to penalise people who were adding extensions to their homes or seeking to self-build? Rather, it was designed as a levy on large-scale infrastructure that would help through reinvestment into the community.

[Sir Jeremy Hunt]

The hon. Member is absolutely right, and he is foreshadowing what I will propose as one of the solutions to this issue: that homeowners should be excluded from the potential ambit of CIL altogether, because that was not its intention. It is a loophole that is being exploited, and I hope to explain why some councils have been so keen to exploit that loophole. We need to remove the root cause if we are going to deal with this issue.

[Kit Malthouse (North West Hampshire) (Con)]

My right hon. Friend is laying out a compelling illustration of the injustices to individuals that this highly complex charge is causing. As he moves on to his solution, will he also reflect on the macroeconomic impact of this complexity and deterrence? I was Housing Minister for a year. Sadly, in those 12 months, I did not get round to sorting out this mess, but it was obvious to me that the small builder sector, which used to produce over 50% of the homes in this country, had been decimated by the crash and never returned. This disincentive to the kind of work that would encourage a really strong small builder sector, which could then contribute more to our economy, is both a brake on growth and a brake on the wider housing aspirations that both Governments have had over the last few years.

[Sir Jeremy Hunt]

I absolutely agree with my right hon. Friend, who has much more experience of the housing sector than I do. He will know that countries like France—not very far away—that have been much more successful than us in building more houses also have a flourishing small builder sector. In this country, because of the enormous costs involved in the planning process and often the land, it is much harder for small builders to get involved. Of course, one of the other advantages of small builders is that they are more likely to get consent from local communities, because they are often from those local communities. I agree with my right hon. Friend entirely: that is one of the unintended consequences of the problems we have with the community infrastructure levy regime.

CIL was drafted with very strong teeth to ensure that developers actually pay up, but for ordinary members of the public trying to do an extension, these Orwellian processes can be utterly terrifying. Some councils—not my own Waverley borough council, alas—recognise the inflexibility of the regulations and have taken a soft-touch approach to prevent homeowners from being captured. To its credit, West Berkshire, which as it happens is also a Lib Dem council, implemented a discretionary review and refunded £400,000 to affected householders. Others have not. I recognise that the difference in councils’ approaches makes the Minister’s job more difficult.

So how should we fix the issue? First, we need to reform the highly complex CIL legislation to distinguish between commercial developers and householders. The problem with a system that is based entirely on the floor area of a project is that even a small increase in the size of a project—just a couple of extra metres on a patio—can suddenly mean that an ordinary homeowner is required to get planning permission, perhaps retrospectively, and can become liable, and they may not know it at the time. Homeowners should be outright excluded from the reach of the community infrastructure levy.

Secondly, even in the absence of legislation, we need clear guidance from the Government to local councils so that no homeowners anywhere are charged for the community infrastructure levy. Thirdly, we need an effective mechanism for redress and the ability to correct genuine mistakes after a liability notice has been issued. Sadly, zero rating CIL liability does not work because a charge remains on the land, which may render the property unsaleable, so the Government need to find a way not just to avoid injustice but to secure justice for the hundreds of families who have been wronged to date by the problems in the system.

Finally, we need to recognise that the root cause of the problem is that councils such as mine have been collecting the community infrastructure levy not just to build infrastructure but so that they can use the interest from unspent CIL as revenue. An estimated £9 billion is sitting in council accounts from unspent contributions by developers, of which an estimated £2.2 billion is unspent CIL. That means that some councils are effectively funding their core services from the human misery of their council tax payers. At a minimum, rules should specify that interest from unspent CIL should go back into the CIL account to avoid a perverse incentive for councils to do the wrong thing.

British democracy rests on the principle of consent and fairness, both of which demand justice for those caught unfairly by the CIL system, which was never designed to capture them. All those people deserve clarity, and this should be prevented from happening again. I know the Minister and many other hon. Members here today want just that, and I look forward to hearing the Government plans.

[Several hon. Members rose—]

--- Later in debate ---

[Sir Jeremy Hunt]

That is quite an unusual thing to be told by the Chair, Mr Turner. I thank you for chairing this important debate and I thank all hon. Members present for some excellent contributions. I particularly want to thank my neighbour and hon. Friend the Member for Farnham and Bordon (Gregory Stafford) for his tenacious campaigning on this issue on behalf of my former constituents in Farnham and Haslemere. He made an excellent contribution. I also want to thank the shadow Minister, my hon. Friend the Member for Orpington (Gareth Bacon), who typically gave a very thoughtful and clear exposition of the issues we face. I also thank hon. Members from other parties who have spoken and intervened.

Before I come on to the Minister’s comments, I want to comment on what was said by the hon. Member for Taunton and Wellington (Gideon Amos), because it was directly about my own local authority. He was right to say that a council cannot lawfully cancel a charge after it has become liable, but that does beg the question why there have been countless injustices in some councils, but not in others, and that is because there has been an element of choice in the way local authorities have decided to go about things.

To make the point that I am not being party political here, Lib Dem West Berkshire has chosen to be reasonable, do the right thing and make sure there is justice for people unfairly caught in the CIL trap, but Lib Dem Waverley has not. It has been in power for seven years and Waverley residents, a number of whom are watching this debate, have suffered badly.

[Gideon Amos]

The right hon. Gentleman is absolutely right that residents need redress. I will simply place on the record again that the nature of the errors or mistakes in charging can be different from one authority to another, which was very much the case with West Berkshire, where the nature of the charges being made wrongly was a different procedural error and therefore a different remedy could be applied. I hope that, in the spirit of being non-tribal with which he began this debate, he will accept that that is actually a fact.

[Sir Jeremy Hunt]

I absolutely accept that. Again, in that spirit of being non-tribal, the hon. Gentleman will know the number of times that his party and other parties have talked about the 14 years in which we had opportunities to fix things that we did not fix, so he will appreciate that the Liberal Democrats in Waverley have had seven years to fix the issue and have failed to do so. That is why so many people from Waverley are looking at this debate carefully. But he is correct to say that all councils have to operate within the law.

I want to move on to the Minister’s comments. First, I thank him for the interest that he has shown right from the start. I want to put on the record that the number of people affected is relatively small in the grander scheme of things, and it would have been easy for the Minister to decide there were other priorities. It is about 100 families—maybe a bit more, maybe a bit less—so the Minister could easily have decided to focus on other areas, but he has not. He has spent an enormous amount of time trying to address this. That is the right and proper thing for a Minister in a democracy to do; if there is an injustice that even affects one person, it is incredibly important that Ministers take note, and he has really done that.

The Minister also clarified the problems with the 2014 exemptions introduced by the coalition Government, which were designed to ensure that householders were not caught up in these regulations, but did so through such a bureaucratic and cumbersome process that many inadvertently have been. The issue of particular complexity relates to householders’ immediate liability from the moment that building starts, which seems entirely reasonable for a professional developer, but entirely unreasonable for a homeowner who may not be aware of that element of the law.

It is extremely welcome that the Government are going to consult on the CIL regulations. As a former Government Minister, I feel a tremendous amount of frustration and pain at the need for endless consultations. They can be of value, but they also slow things down. I recognise that the Minister wants to do this fast—I did groan when he said, “as soon as possible,” but then when he said, “before the summer break,” I took some encouragement. I think this is something that is moving forward.

In the options that the Minister consults on—he cannot respond to this, but it is something to take away—could we find a way of removing homeowners from CIL liability altogether? That way we move away from a system that is purely based on the square meterage of a development, to one based on the type of person doing the development. Could we change the regulations so that homeowners can at least always apply for an exemption retrospectively if an error has been made? Not being able to do so offends natural justice, and was an unintended consequence of the complexity of the original regulations.

I am grateful to the Minister for confronting head-on the fact that for many people, this is about getting justice for something that has happened, not ensuring that injustice does not continue to happen. He has been very open with me about the legal complexities involved, and I know from my time as Health Secretary how difficult it is to reopen retrospective cases. The Minister’s Department has enormous influence over local authorities, however, not least through setting their grants, so if the Department chose, it could find a way to put councils under pressure, where there are outstanding CIL cases and injustice, so that those cases get solved.

I recognise that what I ask is not easy, but it is absolutely the case that local councils are extremely dependent on the Minister’s Department for large chunks of their financing. I ask him to consider what levers he has at his disposal to make this happen, while at the same time thanking him for his ongoing interest and determination to address the issue. The final thing I will say is that I know someone in the Public Gallery got up at 4 am to attend this debate. I thank that person and all the CIL Injustice Group for their tenacious campaigning to try to right a truly awful wrong.

[Karl Turner (in the Chair)]

Thank you, Sir Jeremy. The debate has also been very instructive to me.

Question put and agreed to.

Resolved,

That this House has considered the impact of the Community Infrastructure Levy on private homeowners.