Understanding the Community Infrastructure Levy (CIL)

As urban areas in England and Wales continue to evolve and expand, ensuring that necessary infrastructure keeps pace with development is crucial. Enter the Community Infrastructure Levy (CIL), a tool used by local authorities to support sustainable growth in their communities.

What is the Community Infrastructure Levy?

The Community Infrastructure Levy, commonly known as CIL, is a charge that local councils in England and Wales can impose on new developments. Introduced under the Planning Act 2008 and in effect since April 2010, CIL aims to help bridge the gap between development and the infrastructural needs that accompany it. By contributing financially to the development of schools, roads, healthcare facilities and public spaces, CIL ensures that new builds do not strain existing resources but enhance the quality of life within a community.

How Does CIL Work?

CIL is calculated based on the size and type of new development, measured in terms of gross internal area. It applies to most new buildings and extensions that increase floor space by 100 square meters or more, although some developments are exempt, like certain charitable projects and self-build homes.

The levy is set per square meter of floor space and varies between different local authorities, depending on their specific needs and priorities. Each council develops a charging schedule, outlining how much will be charged for various types of development, which must be reviewed and publicly consulted upon before implementation.

Benefits of the Community Infrastructure Levy

– Predictability: Developers can anticipate the costs associated with CIL early in the planning process. This predictability allows for better financial planning and reduces uncertainty.

– Flexibility: Local councils have the autonomy to allocate CIL funds according to their infrastructure priorities. This flexibility ensures that funds are channeled effectively to where they are most needed.

– Community Enhancement: By contributing to the construction and improvement of public amenities, CIL directly benefits residents and enhances the overall appeal and functionality of communities.

Challenges and Considerations

While CIL has numerous advantages, it is not without its challenges. Determining the appropriate levy rate can be complex, requiring a delicate balance between funding infrastructure and not discouraging development. Furthermore, variations in levy charges across different regions can lead to disparities in development incentives.

Local authorities must also ensure transparency in how CIL funds are allocated and spent, maintaining public trust and ensuring that funds are used for intended purposes.

Conclusion

The Community Infrastructure Levy represents a forward-thinking approach to urban planning, aligning development with community needs. Through CIL, local authorities in England and Wales can foster responsible and sustainable growth, ensuring that infrastructure keeps pace with new developments. As communities continue to grow and evolve, CIL will remain a vital tool in shaping vibrant, well-equipped places for people to live, work, and thrive.

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This blog was prepared by Alexander JLO’s property partner Matt Johnson on the 23rd February 2025 and is correct at the date of publication. Matt has many years of experience of dealing with property work and specialises in new build and shared ownership properties.  His profile on the independent Review Solicitor website and be found Here