How a CIL charging schedule is set and examined

A CIL charging schedule examination is a narrow exercise. The examiner is not testing whether the rates are fair to your site, or whether the infrastructure list is the right one. The single statutory question is whether the charging authority has struck an appropriate balance between the desirability of funding infrastructure from the levy and the potential effects of the charge on the economic viability of development across the area. Understand that framing and the rest of the process, including where a rate can realistically be challenged, makes sense.

The evidence a charging authority has to produce

Two evidence bases sit behind every schedule. The first is an infrastructure position: what the area needs to support planned growth, what it will cost, what other funding is available and what the gap is. Most authorities present this as an infrastructure delivery plan sitting alongside the local plan.

The second is area wide viability evidence. The Community Infrastructure Levy Regulations 2010 and the Planning Practice Guidance both expect this to be proportionate, using typologies of development rather than a site by site appraisal of everywhere. Typical inputs are residual land value appraisals for a set of development types, sales values and rents by value zone, build costs from a published index, and assumptions on developer return and benchmark land value.

What matters for practitioners is that this is area wide by design. An authority does not have to show that every site can bear the charge, only that the rates do not threaten the delivery of the plan as a whole. That is why individual viability arguments belong in a Viability Assessment on a planning application, where they can affect planning obligations, rather than at the charging schedule stage.

Differential rates by use and by zone

The regulations allow differential rates by development type and by geographical zone, and most schedules use both. A typical structure charges residential development at several rates across value zones, sets separate rates for retail, and applies a nil rate to uses the authority wants to encourage or where the evidence shows no capacity to pay.

Every distinction has to be justified by the evidence. A zone boundary drawn without value data behind it is the sort of thing an examiner modifies, and a use class distinction that the appraisals do not test is vulnerable. Representations that point at an unevidenced boundary tend to do better than representations arguing that a rate is too high in general.

The examination and who can appear

The sequence is prescribed. The charging authority consults on a preliminary draft charging schedule, revises it, then publishes a draft charging schedule for representations. Anyone may make representations, and anyone who does so may ask to be heard by the examiner.

That last point is the one agents miss. The right to be heard has to be requested in the representation itself. Where nobody asks, the examination is usually dealt with in writing and can be over quickly. Where a housebuilder or a landowner asks to appear, a public session is held and the authority's viability consultants are questioned on their assumptions.

The examiner is independent, appointed with the authority's agreement and in practice often through the Planning Inspectorate. The recommendation can approve the schedule, reject it, or approve it with modifications, and the authority can only implement a schedule that has been approved, with or without modification. Approval then goes to full council, and the schedule takes effect from a stated date.

Testing the viability evidence behind a rate

If you are making representations, go at the inputs rather than the conclusion. The assumptions that are most often out of date or unsupported are benchmark land value, build cost allowances for abnormals, the developer return applied to different tenures, and the affordable housing policy assumption baked into the appraisal.

The last of those is worth spelling out. Area wide appraisals usually assume the policy compliant level of affordable housing plus a CIL charge plus residual section 106 costs. If the appraisal assumes 20 per cent affordable housing while the plan requires 35 per cent, the headroom is overstated and the rate is too high for policy compliant schemes. Set that out with the authority's own Affordable Housing Statement requirements and the plan policy reference, because it is an internal inconsistency rather than a matter of opinion.

Also check the vintage. Viability evidence prepared two or three years before the draft schedule reaches examination may predate material changes in build costs or interest rates. And check whether the appraisals include the infrastructure that will still be sought through obligations, because charging twice for the same item is a real argument.

Indexation between reviews

Rates do not stay at the published figure. The levy is index linked, using an annual index published by RICS, applied from 1 January each year, and the chargeable amount is calculated using the index figure for the year in which planning permission was granted. Check the current index figure when you calculate liability rather than working from the schedule as published, because on an older schedule the difference is substantial.

Indexation is also why authorities are sometimes slow to review. A schedule adopted several years ago keeps pace with construction costs to an extent without any process at all, which reduces the pressure to go through examination again.

Instalments and discretionary relief

Two levers sit with the charging authority rather than the examiner. An instalment policy lets liability be paid in tranches after commencement, and the terms vary widely between authorities, from a single payment at 60 days to several payments across a two year build programme. Instalment policies can be changed without an examination, so it is worth asking whether one is under review.

Relief in exceptional circumstances only exists where the charging authority has resolved to make it available, and many have not. Where it has been made available, the tests are demanding. There must be a section 106 agreement on the development, the cost of complying with that agreement must exceed the levy liability, and paying the levy must have an unacceptable effect on the economic viability of the development, assessed by an independent person. The relief is discretionary even when the tests are met.

The wider point for anyone budgeting a scheme: CIL is a fixed charge that cannot be negotiated on viability grounds the way planning obligations can. Where viability is tight, the negotiation happens on affordable housing and on the contributions described in your open space and play space contributions position, with the levy taken as a given.

When a schedule is out of date

There is no fixed review cycle. Authorities are expected to keep schedules under review, and a new schedule needs the same consultation and examination as the first one, which is why some areas are still charging on evidence prepared for a superseded local plan.

Three signals suggest a schedule is behind the times. Rates set against a housing requirement that the plan has since changed. Nil rates for uses that have become viable, or positive rates for uses that have not. And an infrastructure position that no longer matches what the authority is actually spending, which you can test against the infrastructure funding statement it must publish each year by 31 December.

An out of date schedule is not a ground for reducing your liability. It is useful evidence in obligations negotiations and in plan making representations, and it is a reason to check whether a review is coming, because the commencement date of a new schedule can make a material difference to when it is worth submitting an application.

One further uncertainty to keep in view. The Levelling-up and Regeneration Act 2023 contains powers for an Infrastructure Levy intended to replace CIL, and the commencement position has moved more than once. Check where those powers stand at the time you are advising, and do not assume a timetable.

This is general guidance, not legal advice. Check the position with the charging authority or a qualified professional before relying on it, because rates, instalment policies and relief arrangements differ between authorities.

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