Section 106 and CIL in plain English, how developer money should be spent in your town

A new estate goes up, the traffic gets worse, the school run gets harder, and suddenly the local park feels too small. Then you hear the phrase “developer contributions” and think, hang on, aren’t builders meant to help pay for this stuff?

That’s where Section 106 CIL comes in. These are two main ways councils secure money (or works) from development, so growth doesn’t leave local people picking up the tab. The problem is, the system can feel foggy, and when it’s foggy, waste creeps in.

This guide breaks it down in everyday language, and sets out what good spending should look like for towns like ours.

What Section 106 means (and why it exists)

A Section 106 agreement (often shortened to “s106”) is a legal deal linked to one specific planning permission. In plain English, it’s the council saying: “We’ll approve this development, but only if you fix the knock-on impacts it creates.”

That can mean the developer must:

• Pay money towards things the development makes worse (like junction capacity, crossings, school places, drainage).
• Provide something directly (like a play area, affordable homes, or open space).
• Do certain works (like new footpaths, bus stops, or road improvements).

The key point is that s106 is meant to be site-related. It’s about making a particular scheme acceptable in planning terms, not a general tax.

If you want a quick, reliable definition, the Planning Portal’s explanation of Section 106 agreements is clear and readable.

The “string attached” nature of s106

Think of s106 like buying a house with conditions in the contract. The council is not asking for a favour, it’s writing enforceable terms that should be delivered on time, in full, and without excuses.

If the council doesn’t track it properly, or fails to enforce it, local residents lose twice: we get the new build, but not the support promised alongside it.

What CIL is (and how it’s different)

The Community Infrastructure Levy (CIL) is closer to a standard charge. Where it applies, it’s usually set as a rate (often per square metre) and collected to help fund infrastructure needed for growth across a wider area.

CIL can support larger, shared projects, for example:

• Major road upgrades
• New schools or expansions
• Flood defences
• Strategic green spaces and leisure facilities

It’s less about one junction outside one site, and more about the bigger picture of growth. Government guidance sits in the Community Infrastructure Levy manual on GOV.UK, which also explains the paperwork councils are meant to keep.

The part that matters locally

CIL often includes a “neighbourhood” portion in places that charge it, which should feed improvements closer to where development happens. If residents can’t see local benefits, confidence collapses fast.

Section 106 vs CIL: a simple comparison

Here’s the quickest way to tell them apart:

Topic	Section 106 (s106)	Community Infrastructure Levy (CIL)
What it is	A legal agreement tied to one planning permission	A set charge on qualifying development (where adopted)
Main purpose	Mitigate that specific development’s impact	Help fund wider infrastructure for growth
Typical spend	Junctions, crossings, on-site open space, affordable housing	Bigger projects, schools, transport schemes, flood works
How it’s secured	Negotiated as part of the planning decision	Charged via the CIL rules and forms
Risk if unmanaged	Promises not delivered, funds left idle	Money pooled with weak local visibility
Best test	“Is this needed because of this site?”	“Is this needed because the area is growing?”

Used properly, Section 106 CIL should work as a pair: one handles specific impacts, the other supports larger shared needs.

What developer money should pay for in your town (the common-sense test)

When people say “make developers pay”, they usually mean something straightforward: if growth creates pressure, contributions should ease that pressure, quickly and visibly.

A practical way to judge spend is to ask: does it make daily life easier for the people already here, as well as the people moving in?

Here are examples that normally pass the test:

Safer roads and walking routes: crossings near schools, footpath links, lighting, traffic calming where the development adds flows.

School capacity and early years: extra classrooms, expansions, and safe travel routes that match where families will actually live.

Transport that works: bus stops, shelters, real-time info, and route support where new estates would otherwise mean more cars. (If money can’t help restore local bus links, people will assume it’s being wasted.)

Drainage and flooding measures: upgrades that reduce surface water risk, not just inside the site boundary.

Parks and play space: maintained green space, play areas, and sports facilities that don’t fall into disrepair a year after handover.

Affordable housing outcomes: not vague promises, but homes delivered, with local needs taken seriously so local people aren’t pushed to the back of the queue.

For local context on how planning decisions are meant to be guided, you can also check Durham County Council’s planning policies.

The traps that make residents furious (and how to spot them)

Most anger around developer money isn’t about the idea, it’s about the follow-through. These are the patterns people recognise straight away:

Money sitting unspent: councils hold pots for years while pavements crumble and traffic grows. Sometimes it’s slow delivery, sometimes it’s poor project planning.

Too much going on admin and third parties: residents expect value for money, not a trail of consultancy invoices and contractor mark-ups.

Projects that feel unrelated: if contributions from a development are spent miles away with no clear reason, trust goes.

Shifting costs onto residents anyway: developer funding should add capacity, not quietly replace things the council should already be doing.

What Reform UK supporters should demand from councils

Local government doesn’t need fancy slogans here, it needs basics done well. A Reform UK style approach to developer contributions is simple: less waste, clearer priorities, and proper accountability.

A strong council standard would look like this:

• Plain-English reporting of what came in, from where, and what it funded.
• Spending deadlines and delivery dates, published and tracked.
• No gravy-train culture, keep senior costs under control so more goes to front-line projects.
• Hard value-for-money checks on contractor pricing, stop rip-off add-ons.
• Local benefit first, communities living with growth should see improvements first, not last.

That’s how you make less money go further, and stop “developer cash” becoming just another foggy pot no one can explain.

How to follow the money (without becoming a planning expert)

You don’t need to read every planning document ever written. Do three things, and you’ll know more than most:

1) Check what was promised at approval stage

Search the planning application and look for s106 heads of terms, committee reports, or decision notices. These usually set out the intent, even before the final legal wording.

2) Look for the council’s annual reporting on developer funds

Councils are expected to publish statements showing what they’ve received and spent, and what’s still sitting there. If it’s hard to find, that’s already a red flag.

3) Challenge weak enforcement and poor decisions

If you think the council has mishandled a Section 106 agreement (or failed to enforce it), the Local Government and Social Care Ombudsman’s fact sheet on Section 106 agreements explains the sort of issues it can consider and how complaints work.

A final tip: when you write to your councillor, ask for one thing, clearly. For example: “How much s106 has been collected for the X development, what has been spent, and what’s the delivery date for the remaining items?”

Conclusion: developer contributions should feel real, not theoretical

If Section 106 CIL is working, you’ll notice it in everyday life: safer roads, better capacity, and facilities that keep up with growth. If you can’t see the benefit, it’s time to ask where the money went, and why.

Growth shouldn’t mean lower standards. It should mean better local services, paid for fairly, delivered on time, and tracked in public. That’s the baseline of accountability that residents should insist on.