Planning Obligation - A Guide to Section 106 and Developer Contributions

Ended on the 21 December 2009

1. Introduction

The Status of this Guide

(21)1.1 This guide is a Supplementary Planning Document (SPD) and is part of the Southend on Sea Local Development Framework (LDF). The LDF is a set of development plan documents (DPDs) and supplementary planning documents (SPDs) that together form the planning policy framework for the town. Supplementary Planning Documents, which are subject to a public consultation process, provide guidance and further clarification of planning policy that is included in Development Plan Documents, which go through a formal statutory examination in public conducted by an independent planning inspector prior to adoption.

The Statutory Basis of Section 106 Agreements

1.2 The statutory basis allowing anyone interested in land to enter into planning obligations (or "S106 Agreements") is Section 106 of The Town and Country Planning Act 1990 as substituted by the Planning and Compensation Act 1991. Government guidance contained within Circular 05/2005 ‘Planning Obligations’ expands upon the basic legal definition in the Act. Planning obligations are private agreements negotiated, usually in the context of planning applications, between local planning authorities and persons with an interest in a piece of land (or "developers"), and intended to make acceptable development which would otherwise be unacceptable in planning terms. Obligations can also be secured through unilateral undertakings by developers. For example, planning obligations might be used to prescribe the nature of a development (e.g. by requiring that a given proportion of housing is affordable); or to secure a contribution from a developer to compensate for loss or damage created by a development (e.g. loss of open space); or to mitigate a development's impact (e.g. through increased public transport provision). The outcome of all three of these uses of planning obligations should be that the proposed development concerned is made to accord with published local, regional or national planning policies. The planning obligations contained in the agreement or undertaking affect all those with an interest in the land being developed and will continue to affect subsequent owners of the property if the obligations are still capable of being complied with or carried out.

1.3 As stated in Circular 05/2005, the principal objective of the planning system is to deliver sustainable development, through which key Government social, environmental and economic objectives are achieved. The delivery of these goals is provided for in a framework of development documents, in which local communities are positively involved, and through a transparent system of decision-making on individual applications.

1.4 In dealing with planning applications, local planning authorities consider each on its merits and reach a decision based on whether the application accords with the relevant development plan, unless material considerations indicate otherwise. Where applications do not meet these requirements, they may be refused. However, in some instances, it may be possible to make acceptable development proposals which might otherwise be unacceptable, through the use of planning conditions (see Department of the Environment Circular 11/95) or, where this is not possible, through planning obligations.

1.5 This SPD adheres to a fundamental principle that planning permission may not be bought or sold and that planning obligations must only be sought to make acceptable development which would otherwise be unacceptable in planning terms. Circular 05/2005 outlines the guiding principles of planning obligations i.e. to make applications acceptable when conditions cannot achieve the benefits required and states that obligations can ‘prescribe’ (e.g. require the provision of affordable housing), ‘compensate’ (e.g. loss of open space) or ‘mitigate’ (e.g. through increased public transport provision). It states that planning obligations should only be sought where they meet the following tests:

  1. Relevant to planning;
  2. Necessary to make the proposed development acceptable in planning terms;
  3. Directly related to the proposed development;
  4. Fairly and reasonably related in scale and kind to the proposed development and;
  5. Reasonable in all other respects.

Policy Framework

1.6 In accordance with Office of the Deputy Prime Minister Circular 05/2005 on Planning Obligations, this SPD amplifies the Circular and describes the Council’s approach in securing planning obligations as outlined in the Core Strategy DPD (adopted December 2007), Southend on Sea Design & Townscape Guide SPD (adopted June 2006) and ‘saved’ policies of the Southend-on-Sea Borough Local Plan (1994). It is likely that this SPD will need to be adapted as other Local Development Documents emerge to reflect any new national, regional and local policies relating to planning obligations.

1.7 All national, regional and local planning policies and other guidance that are relevant to this SPD are listed in Appendix 1 for reference purposes.

Regional and Sub-Regional Policy Framework

(1)1.8 The Council and its partners are active participants in the Government’s Thames Gateway regeneration initiative, a national and regional priority for regeneration and growth, as set out in existing and emerging national and regional policy. The East of England Plan 2008 contains specific guidance for the Thames Gateway South Essex sub-region to deliver regeneration in a manner specific to the needs and requirements of the local area. The overall spatial vision of the East of England Plan is that "By 2021 the East of England will be realising its economic potential and providing a high quality of life for its people including by meeting their housing needs in sustainable inclusive communities".

1.9 For implementation and delivery of its policies for the region, the East of England Plan states that it requires significant investment in social, environmental and physical infrastructure to achieve its desired outcomes. The Plan identifies the need to secure a ‘step-change’ in critical areas such as affordable housing, job provision and infrastructure investment, and that coordination between development and infrastructure delivery will need to be significantly improved. Many of the growth and regeneration proposals are highly infrastructure dependent, and may be difficult to deliver in a sustainable manner if infrastructure (social, health, education, leisure as well as transport and jobs) is not delivered in close co-ordination. Remedying deficiencies will be critical if the high growth rates and regeneration priorities, which the region needs to pursue, are to be achieved. Major public funding together with developer contributions will be needed to provide the necessary finance for transport and other community infrastructure to support the amount of growth being proposed in the sub-region up to 2021.

Local Policy Framework

1.10 All Council activities are guided by, and should be consistent with, the objectives and priorities set out in a Corporate Plan and a Community Strategy. Southend Borough Council’s Corporate Plan 2009-2012 aims to create a safer, cleaner, healthier and more prosperous town and the Sustainable Community Strategy 2007-2017 provides an agenda to improve the quality of life of the population of Southend. The Community Strategy aims to create a thriving regional centre which celebrates and enriches our community ensuring that the Borough develops in a sustainable manner. The ambitions are as follows:

  1. To provide visionary leadership and enable inclusive, active and effective participation by individuals and organisations;
  2. To create a safer community for all;
  3. To be recognised as the cultural capital of the East of England;
  4. To create a thriving and sustainable local economy, which extends opportunity for local residents and promotes prosperity throughout the borough;
  5. To continue improving outcomes for all children and young people;
  6. To protect the borough for current and future generations and to remain an attractive place for residents, businesses and visitors;
  7. To provide opportunities, support and information to people of all ages and abilities to enable them to take responsibility for their health and choose a healthy lifestyle;
  8. To be a borough with decent housing, in safe and attractive residential areas, that meets the needs of those who want to live here;
  9. To be a borough that has a safer, more accessible, and affordable means of getting about, which supports the potential for regeneration and growth.

1.11 These themes provide a long term framework for the town and developer contributions will be essential to their implementation and delivery. Planning obligations will, therefore, be required to ensure that development proposals are proactively assisting the community in its efforts to achieve the priorities and targets outlined in the Community Strategy.

1.12 The Core Strategy Development Plan Document (adopted December 2007) sets out a clear aim and set of strategic objectives for the spatial planning policies that will guide development in the Borough to 2021. Improving the quality of the built and natural environment and minimising the impact on climate change are key to achieving national and local priorities in Southend. The aim of the Core Strategy is as follows:

"To secure a major refocus of function and the long term sustainability of Southend as a significant urban area which serves local people and the Thames Gateway.To do this there is a need to release the potential of Southend’s land and buildings to achieve measurable improvements in the town’s economic prosperity, transportation networks, infrastructure and facilities; and the quality of life for all its citizens. This will include safeguarding and improving the standards of the town’s amenities and improving the quality of the natural and built environment."

(1)1.13 The current local policy basis for planning obligations is found in Core Strategy DPD policy KP3 ‘Implementation and Resources’, which states that the Council will:

"require developers to enter into planning obligations to carry out works or contribute towards the provision of infrastructure and transportation measures required as a consequence of the development proposed. This includes provisions such as;

  1. roads , sewers, servicing facilities and car parking,
  2. improvements to cycling, walking and passenger transport facilities and services,
  3. off-site flood protection or mitigation measures, including sustainable drainage systems (SUDS),
  4. affordable housing,
  5. educational facilities,
  6. open space, ‘green grid’, recreational, sport or other community development and environmental enhancements, including the provision of public art where appropriate,
  7. any other works, measures or actions required as a consequence of the proposed development, and
  8. on-going maintenance requirements".

1.14 More detailed guidance is provided in Policies CP3 (Transport and Accessibility), Policy CP6 (Community Infrastructure), Policy CP7 (Sport, Recreation and Green Space) and Policy CP8 (Dwelling Provision). Policy CP8 ‘Dwelling Provision’ makes specific reference to the provision of affordable housing (including key worker housing). It states that residential development will be expected to contribute to local housing needs; including special needs provision and sustainable use of land and resources. The policy describes the specific provision required by developers for various development thresholds and site areas. It also declares that tariffs and/or a commuted sum will be collected for sites under 10 dwellings or qualifying sites where it will not be possible to cater for affordable housing on site.

1.15 The Southend on Sea Borough Local Plan (BLP), adopted in 1994, also provides policy guidance relating to the contribution of new and additional developments towards infrastructure, facilities and services. The following saved policies are relevant:

  1. Policy C11 – encourages the provision of new works of public art as part of a development;
  2. Policy L5 – encourages the provision of new entertainment, cultural and arts facilities in support of local arts organisations;
  3. Policy R1 – encourages the provision of additional outdoor sports facilities, both public and private;
  4. Policy R2 – encourages the provision of additional indoor sports facilities, both public and private;
  5. Policy R5 – encourages the provision of new open space facilities; and
  6. Policy U1 – states that in assessing development proposals the Borough Council will have regard to the need for additional infrastructure provision, such as roads, sewerage, schools and community facilities, and that applicants may need to enter into a legal agreement to ensure the provision of such facilities to enable the development to proceed.

1.16 Southend Borough Council, together with 281 other local authorities to date, has also signed up to The Nottingham Declaration on Climate Change, which requires local authorities to work with the community to develop an action plan to tackle climate change at a local level. By signing the declaration, the Borough Council committed itself to move towards environmental sustainability by cutting carbon emissions. In accordance with the commitments of the Declaration the Council will encourage developers to reduce their environmental impact.

Community Infrastructure Levy

(1)1.17 The Planning Act 2008 made provision for the imposition of a Community Infrastructure Levy (CIL) to ensure that the costs incurred in providing infrastructure to support the development of an area can be funded by owners or developers of land. A CIL will not replace the need for all planning obligations but, if it is introduced by the Council, will require amendments to this SPD. In parallel to any emerging national legislation in relation to a CIL the Council will be preparing a Development Delivery DPD and a revised Planning Obligations SPD, which will contain more detailed policies in relation to planning obligations and will eventually replace this document.


1.18 In November 2006 the Council drafted a Development Plan Document relating to Planning Obligations & Vehicle Parking Standards, which was drafted as a ‘preferred options’ document for the purpose of wide public participation under Regulation 26 of the Town and Country Planning (Local Development) (England) Regulations 2004. The draft DPD was subject to extensive public consultation including targeted consultation with local and national specialist organisations and interest groups and local residents and businesses. This SPD has been drafted so that it is broadly consistent with this document, taking into account the comments received from consultation.

1.19 The Planning and Compulsory Purchase Act 2004 requires that a Sustainability Appraisal be undertaken alongside the preparation of an SPD. The Sustainability Appraisal is also required to incorporate the requirements of the European Union Directive 2001/42/EC on Strategic Environmental Assessment. The aim of this is to better integrate the sustainability objectives into plan preparation. A Sustainability Appraisal was drafted by a specialist consultant in association with the ‘Planning Obligations & Vehicle Parking Standards DPD’ preferred options document and was the subject of public consultation as detailed above. The previously drafted Sustainability Appraisal and comments received in response to the document have been taken into consideration in the drafting of this document. In addition, a Sustainability Appraisal has been drafted specifically in relation to this Planning Obligations SPD and both documents will now be the subject of a further 6 week public consultation period.

The Strategic Importance of Planning Obligations

1.20 Development often creates the need for additional infrastructure, services and facilities. If these are not provided, there could be negative implications for local amenity and the environment. Planning obligations provide the mechanism through which the impact of development is accommodated and they are secured to ensure that developers mitigate this impact and provide for the infrastructural requirements arising from development in a sustainable way.

(1)1.21 In some instances where a number of developments will share facilities it may be appropriate to pool financial contributions for various types of planning obligations e.g. environmental or highways improvements and community facilities that are of strategic importance. Circular 05/2005 and the related best practice guidance encourage pooled contributions but emphasise the need for a clear audit trail for these contributions, which will be facilitated by the S106 monitoring database that the Council has developed.

Purpose of this Supplementary Planning Document

(1)1.22 The purpose of this document is to set out Southend Borough Council’s approach towards seeking planning obligations when considering planning applications. It sets out the priorities for planning obligations and identifies the ways in which those priorities can be applied in the case of individual development proposals. This SPD includes a summary of the relevant national, regional and local planning policies with which it is consistent. In addition, this document includes procedural information and contact details to assist in the negotiation of legal agreements.

1.23 Where there is a choice between imposing conditions and securing a planning obligation through a legal agreement, it is noted that the Government considers the imposition of a condition as preferable. When considering applications, Southend Borough Council will therefore consider whether planning conditions can adequately control all the direct and indirect impacts of the development and secure the desired planning obligations, before it decides that a legal agreement is necessary.

(3)1.24 Southend Borough Council supports the central government objectives of transparency, certainty and speed in the S106 process, hence the production of this SPD and the publication of a model S106 agreement as endorsed by Circular 05/2005 ‘Planning Obligations’. However, to provide even greater clarity in the future and to maximise the potential of planning obligations in meeting sustainability objectives it is likely that Southend Borough Council will further explore the use of formulae in seeking contributions together with the pooling of funds as endorsed by the Circular. This approach will be developed as part of the forthcoming Development Delivery DPD, which will be subject to public consultation and an examination in public, unless this approach is retracted by the Government should the Community Infrastructure Levy be pursued.

1.25 A glossary of terms including a brief description of some of the words and acronyms that appear in this document is available in Appendix 5.

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