S106 - What is it?

Published : 03/10/2019

You might have heard that something in your local area was funded by Section 106 money, but what does that actually mean?

The name Section 106 refers to the part of the Town and Country Planning Act 1990 that enables the creation of these agreements.

They are made between the council and the developer/landowner and ensure that new developments provide the appropriate service, infrastructure and amenities to mitigate the various impacts the development would have and provide for the needs that would arise.

Repton Connect

They are legally binding agreements and are connected to the grant of a planning permission. They can contain financial and non-financial obligations and deal with matters that are beyond the scope of conditions attached to a grant of planning permission.

Examples of some of the areas where Ashford Borough Council can ask for s.106 contributions are:

  • Adult social care
  • Libraries
  • Affordable housing
  • Local needs housing
  • Allotments
  • Monitoring fee
  • Carbon off-setting
  • Outdoor sports pitches
  • Cemeteries
  • Primary schools
  • Children’s and young people’s play space
  • Public art
  • Community learning
  • Secondary schools
  • Controlled parking zone
  • Strategic parks
  • Health care
  • Town centre commuted parking
  • Informal/natural green space
  • Voluntary sector
  • Local road network improvements
  • Footpath and cycle-way improvements
  • Strategic road network improvements such as Junction 10A of the M20
  • Residents’ parking schemes
  • Funding the making of traffic regulation orders
  • Youth services
  • Legal costs

In some cases, the council will collect the money at the agreed time and then transfer it to the appropriate body, for example to KCC for adult social care or schools or the NHS for health care, to be spent as the agreement states.

Smallhythe Road flats

The funding comes from the developer or landowner. It is usually calculated depending on the size and nature of the development, often on a per dwelling basis, and can include contributions to several different amenities within the same agreement.

When the council receives a planning application it consults with a number of stakeholders to understand what they consider the likely impacts of the development to be and ways in which it could be accommodated. These include Kent County Council, the NHS and other council departments. They then feedback their views on the scheme and confirm the contributions they want the council to negotiate in order to mitigate the needs and impacts arising from the proposal.

If the scheme is considered acceptable, the council will resolve to grant planning permission subject to the completion of an s.106 agreement. The agreement is then negotiated between the parties. Only when the agreement is completed will permission for the development be issued by the council.

An agreement under s.106 will usually require spending close to the development concerned in order to mitigate the impacts that would arise from its construction. At Chilmington Green, for example, the developers are contributing to new schools, health facilities, sports and recreation areas, and other community buildings, all on the same site, to meet their needs.

Church Road play area in Sevington was recently reopened with new equipment thanks to s.106 funding from Highways England as part of Junction 10A and new developments on Victoria Road are helping to pay for the proposed improvements to Victoria Park.

Danemore Lounge

The funding is paid to the council at specific points during the build, as set out in the agreement. This is often as a certain percentage of the dwellings are first occupied in a housing development or at other agreed trigger points. The obligations in the agreement will specify how the contributions will be used.

S.106 contributions mean the council can ensure that the needs generated by new development can be met without spending taxpayers’ money and the impacts arising from these are acceptably mitigated with benefits to the occupiers of new development as well as the existing community. This means that council tax income can be spent on more critical services like housing.