Councils can compensate homeowners over levy errors

Protesters are celebrating after councils were told they could compensate people landed with bills for tens of thousands of pounds because of clerical errors.

Self-builders and those extending their homes had been left owing the money under the Community Infrastructure Levy (CIL), which is intended to help fund services such as new school places and road improvements for growing communities.

Homeowners were usually meant to be exempt, but a campaign group said complex rules and paperwork led many to be charged incorrectly.

However, councils have previously argued they were bound by strict regulations governing the levy, leaving them with limited discretion even where charges appeared unfair.

Surrey resident Steve Dally, who led the campaign, said: "What has seemed on many occasions impossible - has today been made possible."

Housing minister Matthew Pennycook has written to council leaders saying there is nothing to stop authorities making payments to those facing "hardship" because of the bills.

He told local politicians it might be "appropriate" in cases where "a householder developer would have been entitled to an exemption but, as a result of an administrative error, failed to claim it in accordance with the required procedure."

The BBC first reported concerns about CIL after owners of a block of flats in Reading, destroyed in an arson attack in which two people died, were told they had to pay the charge.

They were deemed liable because emergency services demolished the remains of the building to recover the victims' bodies, meaning work had technically begun before a formal application to rebuild was submitted.

Residents in West Berkshire also complained they had been "named and shamed" by council officials when signs accusing them of owing money were placed in their front gardens.

After a change in political control, the new Liberal Democrat administration admitted the council had been over-zealous. It launched a scheme to reimburse people it said had been charged "against the spirit" of the regulations.

But other councils, including neighbouring Wokingham and Waverley in Surrey, said they had no discretion over the charges.

Last month, the Housing Secretary told MPs and campaigners the government hoped to unveil plans to reform the system before Parliament's summer recess, which begins next month.

He also promised to look at those already affected by the existing rules.

Campaigners such as Dally said the letter showed the minister was making good on that commitment.

Dally did receive a refund from Waverley Borough Council, but others have been forced to put their homes up for sale to meet the demands.

He said he was "delighted" with the minister's comments and hoped they would "open the doors to other CiL victims."

Council leader Paul Fellows, giving his initial reaction, said the authority had already asked to hear from people who believed they had been caught out by the system.

He said the minister's guidance was "what we asked for to make this easier and more fair."

The BBC has also approached Wokingham Borough Council for its response.

You can follow BBC Berkshire on Facebook, X (Twitter), or Instagram.