Introduction to Development Management
Development management plays a pivotal role in shaping the landscapes and communities within our towns and cities. It is the process that governs and facilitates the way land is used and developed, ensuring a balance between growth and sustainability. At the heart of this process are tools and mechanisms to make sure that developments contribute positively to their environments, address local needs, and comply with legal frameworks. Three key instruments are often used by planning authorities and developers: planning conditions, planning obligations (commonly known as Section 106 agreements in England and Wales), and planning contributions. In this article, we will explore the role and distinctions of conditions, obligations, and Section 106 agreements within the broader context of development management, helping you understand their application and significance.
Understanding Development Management
Development management involves a series of processes and regulations designed to control how land and buildings are used. Local planning authorities (LPAs) are responsible for administering official policies and making decisions on planning applications. Their aim is not only to guide local growth but also to secure economic, environmental, and community benefits from any development. As a result, development management tools have evolved to ensure that both developers and local communities experience positive outcomes.
In this context, three mechanisms are particularly important:
- Planning conditions
- Planning obligations (including Section 106 agreements)
- Community Infrastructure Levy (CIL) and other forms of contributions
For this article, our focus will be on the first two: conditions and obligations, with a special emphasis on Section 106 agreements.
Planning Conditions in Development Management
Planning conditions are among the most common and direct tools for local planning authorities to ensure that a development meets the necessary requirements. When an LPA grants planning permission for new development, they often attach certain conditions to mitigate potential negative impacts and to make sure the project is suitable for its location. These conditions are legally binding and must be complied with if the project is to proceed.
Typical planning conditions address issues such as:
- Design and materials to be used
- Landscaping and environmental protection
- Hours of operation (for commercial developments)
- Car parking provision and highway access
- Pollution control measures
- Phasing of works
- Provision of adequate drainage and utilities
Each condition must meet the well-established legal tests set out in Section 72 of the Town and Country Planning Act 1990 and subsequent government guidance. These tests require that a condition must be:
- Necessary
- Relevant to planning and the development to be permitted
- Enforceable
- Precise
- Reasonable
The conditions are typically either pre-commencement (must be satisfied before development starts), pre-occupation (must be fulfilled before development is occupied or used), or ongoing (must be continuously met for the life of the development). Failure to comply with a planning condition can result in enforcement action, including the issuance of a breach of condition notice.
Planning Obligations and Development Management
While planning conditions deal with specific issues on-site, they are sometimes insufficient to address wider or off-site impacts. In these circumstances, planning obligations are used. A planning obligation is a legally binding agreement between a developer and a local planning authority, used most commonly to mitigate the impact of a development proposal and to ensure that a development contributes to the delivery of sustainable communities.
Planning obligations can require a developer to:
- Make a financial contribution towards local infrastructure, such as schools or transport links
- Provide on-site affordable housing
- Undertake works to improve public spaces or highways
- Implement travel plans or green space management regimes
- Restrict the use of land in a specific way
- Contribute to environmental mitigation or offsetting measures
Planning obligations have their legal foundation in Section 106 of the Town and Country Planning Act 1990, hence the term “Section 106 agreements”.
The Role and Use of Section 106 Agreements
Section 106 agreements (S106) are the most commonly used type of planning obligation in England and Wales. Their primary function is to make a development proposal acceptable in planning terms, something which cannot always be achieved through conditions alone. They must be:
- Necessary to make the development acceptable
- Directly related to the development
- Fairly and reasonably related in scale and kind to the development
These are collectively known as the “CIL Tests,” derived from the Community Infrastructure Levy Regulations 2010. S106 agreements are negotiated between the LPA and the developer, often following extensive discussion and sometimes with third-party stakeholders, such as affordable housing providers or local community groups.
S106 agreements can cover a wide range of issues, including but not limited to:
- Provision of affordable housing units (on- or off-site)
- Payments towards education, health care, open space, and recreational facilities
- Improvements to local highways and transport infrastructure
- Contributions to local arts, culture, and public realm enhancements
- Environmental mitigation, such as biodiversity net gain or flood alleviation schemes
Once agreed and signed, a Section 106 agreement becomes a registered local land charge. This means it binds the land and all subsequent owners or occupiers, not just the initial developer.
Negotiating Section 106 Agreements in Development Management
Negotiations on S106 agreements can be complex. Planning authorities must balance the need to secure the necessary infrastructure and community benefits against ensuring the overall viability of the development. If obligations are set too high, a development may become unviable, discouraging investment. Conversely, if they are too low, essential contributions might not be secured, placing pressure on existing facilities and residents.
It is common for both developers and LPAs to prepare viability appraisals to demonstrate what can reasonably be provided. Some LPAs publish guidance that sets out typical S106 requirements for different types and scales of development. Nonetheless, each agreement must be specific to the proposal and reflective of its impacts.
Types of Obligations in Section 106 Agreements
The main types of obligations that can be contained within a Section 106 agreement are:
- Financial Contributions: Lump sums or staged payments for local services, facilities, and infrastructure.
- In-Kind Deliveries: The direct provision of facilities such as play areas, roads, health centers, or schools.
- Affordable Housing: Requirements to provide a certain percentage or number of homes for affordable or social rent/shared ownership.
- On-Going Management: Setting up management companies to maintain open spaces and community facilities.
- Restrictive Covenants: Placing limits on how land can be used after development.
Every obligation must be justified and reasonable, with planning authorities guided by the National Planning Policy Framework (NPPF) and relevant local development plan policies.
Enforcement and Modification of Section 106 Agreements
Once a Section 106 agreement is signed, it is legally binding. If a developer does not comply, the LPA can seek enforcement through the courts, obliging the developer or landowner to fulfill their commitments. In certain circumstances, developers can apply for a modification or discharge of the agreement, but this is a formal legal process and must be justified on material grounds, typically where circumstances have changed significantly since the agreement was signed.
Moreover, LPAs are required to monitor compliance and report publicly each year on the planning obligations they have secured and delivered, as part of new transparency requirements in line with the Infrastructure Funding Statement. This is designed to ensure greater accountability and public awareness about how new developments benefit local areas.
Section 106 and the Community Infrastructure Levy (CIL)
Section 106 agreements have, over recent years, been supplemented and, in some cases, partly replaced by the Community Infrastructure Levy (CIL). CIL allows LPAs to raise funds from new development towards a range of infrastructure needs, such as transport, schools, or health services. Unlike S106, CIL is a set charge per square meter of new floor space and is non-negotiable. While CIL has simplified some aspects of developer contributions and made them more predictable, S106 remains critical for site-specific mitigation and affordable housing.
The relationship between the two regimes is carefully managed to avoid “double-dipping” (charging twice for the same infrastructure). As such, S106 is now more focused on on-site mitigation and affordable housing.
Benefits of Section 106 Agreements in Development Management
Section 106 agreements, alongside planning conditions and obligations, play a critical role in development management, ensuring that developments are both legally compliant and beneficial to local communities. When used effectively, these tools can secure affordable housing, improve infrastructure, and deliver meaningful public benefits, while protecting the interests of developers and local authorities.
For professional advice and guidance on navigating planning conditions, Section 106 agreements, or any aspect of development management, Charrette Law offers expert support tailored to your project. Our team helps you understand obligations, negotiate agreements, and ensure your development complies with planning law while maximising community and commercial outcomes. Contact Charrette Law today to discuss your project and secure the guidance you need for a successful development.