Planning Obligations (Section 106)
Planning obligations are used to ensure new developments provide the required services, infrastructure and amenities to serve new and existing communities.
What are Planning Obligations?
The legislative justification for planning obligations is set out in Section 106 of the Town and Country Planning Act 1990, as amended by Section 12 of the Planning and Compensation Act 1991. A planning obligation which, can take the form of a Unilateral Undertaking a Section 106 Agreement or a Section 38 or 278 Agreement, is a legal agreement between a local authority and a developer or landowner. Usually planning obligations are formally registered as land charges which, means that if the development site is sold the planning obligation remains a legal agreement between the new land owner and the local authority.
Planning obligations enable a council to secure funding contributions towards services, infrastructure and amenities in order to support and facilitate a proposed development.
The requirements of a planning obligation will vary according to the size, impact and nature of the proposed development. At Malvern Hills District Council, planning officers rely on the South Worcestershire Development Plan (SWDP) as well as Supplementary Planning Documents (SPDs) to inform applicants of the requirements for their particular development proposals.
Planning obligations are required to meet the statutory tests (known as Regulation 122) in the Community Infrastructure Levy (CIL) Regulations 2010 (as amended). In order for the Council to seek contributions from planning applications, planning obligations need to be:
•necessary to make the development acceptable in planning terms;
•directly related to the development; and
•fairly and reasonably related in scale and kind to the development.
These tests are also set out in the National Planning Policy Framework (Paragraph 204).
The introduction of the Community Infrastructure Levy (CIL) Charging Schedules by each of the South Worcestershire Councils’ will mean that some future infrastructure contributions will be made in the form of CIL payments, rather than through planning obligations. Once CIL is operational, (likely to be from 2017), the number of development proposals that require a planning obligation should be reduced.
Further information relating to the Community Infrastructure Levy can be found on the CIL page.
What is the purpose of these Planning Obligations?
All development has the potential to impact on the environment and place pressure on local infrastructure and services. The planning system can ensure new development has a reduced impact on the local environment and surrounding infrastructure. Conditions attached to planning applications and/or legal agreements with developers (i.e. planning obligations) can secure positive benefits for the local environment, mitigation, or contributions towards directly related infrastructure improvements.
Planning legislation includes the essential principle that developments should pay for the social and physical infrastructure to support and facilitate a development. A developer should pay towards the infrastructure necessary to make a development proposal acceptable in planning terms.
Planning officers will not ask for any contribution unless it meets the statutory tests. If a developer offers any unrelated contribution as an inducement, planning officers will disregard this when determining the application.
For example, it may not be proper for a local planning authority to seek contributions towards the development of a public swimming pool arising from an application for a supermarket development. However, it may be appropriate to expect a supermarket developer to contribute towards highway improvements.
How will contributions be spent?
Planning obligations will often specifically identify what the financial contribution will be used for. Officers from a range of departments such as Housing, Community Services, Legal Services and Economic Development, work with Planning Officers to ensure that contributions are correctly allocated and handled.
In some cases, individual contributions will be ‘pooled’ to provide major infrastructure or service improvements. However, since April 2015 under CIL Regulations it has been unlawful for local planning authorities to pool contributions from more than five planning obligations, towards the same project or type of infrastructure, if more than five similar agreements have been signed since 6th April 2010. This makes it more difficult for the South Worcestershire Councils to collect planning obligations within the scope of existing planning policy.
Additionally, Regulation 123 of CIL Regulations 2010 (as amended) makes it unlawful for a charging authority to seek planning obligations to fund infrastructure which it is intending to support with receipts from CIL.
The council monitors completed agreements to make sure that once the development has been started, agreed payments are received by the District Council on time and if they are not for any reason, arrangements are made to collect late payments.
How is infrastructure secured?
Infrastructure can be secured through a wide variety of means including:
- The South Worcestershire Development Plan Infrastructure Delivery Plan;
- Supplementary Planning Documents that explain how policies will be effectively implemented (see below);
- Planning conditions;
- Planning obligations;
- The Community Infrastructure Levy; and
- Other funding sources such as the New Homes Bonus.
The District Council holds a range of evidence base documents which support the infrastructure-securing sources above. The supporting evidence can be found on the SWDP website.
Further information and guidance
Developer Contributions SPD
The Developer Contributions SPD sets out the South Worcestershire Councils’ approach to seeking developer contributions via the SWDP for infrastructure or environmental improvements required as a result of development. The SPD provides guidance about when planning obligations will be expected, the scale of developer contributions, and how developer contributions will be used.
Affordable Housing SPD
The Affordable Housing SPD covers the administrative areas of Worcester City Council, Malvern Hills District Council and Wychavon District Council. It explains the details of the South Worcestershire Development Plan (SWDP) policies that relate to the provision of affordable housing. It is a guide intended to help developers, landowners, applicants applying for planning permission, registered providers and others who are seeking to provide or benefit from affordable housing.
Other S106 Information
Application to vary a Section 106 planning obligation
Monies held for Section 106 Agreements
The position at the end of December 2015 with regard to monies held for S106 agreements.
Who to Contact.
If you have any questions about planning obligations please contact the Development Control team, email: firstname.lastname@example.org