Improving local areas through developer funding

The Ministry of Housing, Communities & Local Government (MHCLG) has overall policy responsibility for planning in England, while frontline decisions are made by Local Planning Authorities (LPAs). When a development is due to take place, developers make financial contributions to the LPA as part of the process of granting planning permission. These contributions go towards … Show more

The Ministry of Housing, Communities & Local Government (MHCLG) has overall policy responsibility for planning in England, while frontline decisions are made by Local Planning Authorities (LPAs). When a development is due to take place, developers make financial contributions to the LPA as part of the process of granting planning permission. These contributions go towards infrastructure, such as affordable housing, schools and roads, to offset extra pressure created by the development on the local community. Contributions are made via Section 106 agreements (private agreements negotiated between developers and LPAs) and the Community Infrastructure Levy (CIL) (a charge that local authorities can choose to apply to new developments). The CIL cannot fund affordable housing, but in 2022-23, some 44% of affordable housing was provided through Section 106 agreements. The Public Accounts Committee has previously examined Government progress on targets set to deliver the affordable housing stock. In 2022 the Committee found that the Government was likely to fall short of targets and had failed to set a target outlining what percentage of new-build housing must be affordable. The Committee had previously warned that targets were likely to be missed in a 2019 report, which found that inherent problems at the heart of the housing planning system were likely to jeopardise the Government’s ability to meet targets. A recent investigation by the National Audit Office (NAO) focused on MHCLG’s ability to oversee the current developer contribution system and whether this was having the intended benefits for local authorities and communities. The NAO’s work will inform the Committee’s inquiry, as it hears evidence from senior MHCLG officials, on topics likely including: Asking if the current system is understandable and accessible to stakeholders; Questioning if LPAs are receiving the correct support from MHCLG to ensure they are able to efficiently and effectively collect and spend developer contributions and; Examining MHCLG’s oversight of the system and its ability to learn and apply lessons to the process. If you have evidence on these issues please submit it here by 23:59 on Monday 16 June 2025. Please look at the requirements for written evidence submissions and note that the Committee cannot accept material as evidence that is published elsewhere. Please note that the Committee’s inquiry cannot assist with individual cases. If you need help with an individual problem you are having, you may wish to read the information on Parliament’s website about who you can contact with different issues . Show less