Despite a backlash from major UK housebuilders, Bristol City Council’s plans to introduce the government’s Community Infrastructure Levy (“CIL”) are now on course.  At a public inquiry on 21 June 2012, housebuilders opposed Bristol’s proposed charges, which they argued were not based on robust viability evidence. However, the examiner has now found in favour of the Council and if the full Council votes to adopt CIL in September, the levy is likely to be brought into force by 1 January 2013.

CIL is set locally according to the amount of infrastructure that councils consider is necessary to support development in their area. It is based on the net additional amount of floorspace which is created by the new development. According to government research, CIL has the potential to raise an estimated £1 billion a year of funding by 2016.

But CIL, like Planning Gain Supplement before it, is not without its critics. Leading housebuilders, including Barratt and Taylor Wimpey, have grouped together to  set up a “fighting fund,” managed by the Home Builders Federation, to tackle councils amid concerns that inflated charges in these difficult financial times will only serve to dampen development. Widespread disputes are expected to take place all over the country as councils introduce CIL, with critics complaining that councils are setting higher charges to counteract the squeeze on their budgets. The group is also challenging potential charges at the councils of Mid Sussex, Central Lancashire, Thurrock, Chelmsford, Exeter and South Somerset. Recently, Sainsbury’s successfully drove the Borough of Poole to pull its CIL on new superstores, and developers in London, already paying the London mayor’s CIL as a contribution towards Crossrail, are set to challenge boroughs introducing their own supplemental charges in the coming months.

To date, only five councils have brought CIL into force and only a further 50 have published their proposed CIL rates for consultation, despite the fast approaching April 2014 deadline.