Southwark Council has approved the launch of a public consultation on proposed changes to the Community Infrastructure Levy (CIL) for student housing, following a Cabinet meeting on Tuesday, 14 October 2025. The consultation, which will last for a minimum of thirteen weeks, will focus on direct-let Purpose-Built Student Housing (PBSH) and aims to ensure developers contribute fairly to the borough's infrastructure needs.
The decision follows a viability review by BNP PRE that indicated an increase in the CIL rate for direct-let PBSH is possible without deterring development. The study recommends increasing the rate by £103.54 per sq.m to a borough-wide rate of £250 per sq m. This represents a 70% increase in CIL to an average of 3.8% of development costs, which the viability testing considers unlikely to be a determining factor in scheme viability. Councillor Helen Dennis, Cabinet Member for New Homes and Sustainable Development, highlighted the importance of PBSH making a fair contribution to Southwark's infrastructure, stating that the council does not want to wrongly incentivising student homes over those which are much needed for the wider community.
The Community Infrastructure Levy (CIL) is a charge on new developments, used to fund infrastructure improvements such as transport, schools, and open spaces. Southwark Council adopted its CIL Charging Schedule in 2015 and revised the zone boundaries in 2017. The current review focuses solely on direct-let PBSH, which are let directly to students at market rents without university nomination agreements. Nomination schemes, delivered under agreements with higher education institutions and subject to rent caps, will remain at a zero CIL rate.
The public consultation will last for a minimum of thirteen weeks, in accordance with Southwark Council's Statement of Community Involvement. If material modifications to the Charging Schedule are required following the consultation, a further four-week consultation will be held. If no material modifications are needed, the revised CIL Charging Schedule will be submitted for Examination.
The council aims to implement the changes from January 2027, subject to approval by the Examiner and completion of subsequent procedural steps.
