Developer Contributions

Section 106 Agreements are legal contracts between Local Authorities and the owners of development sites which include obligations that are essential to allow the granting of planning permission in certain circumstances.

They are commonly used to require developers to pay financial contributions towards infrastructure but can also secure non-financial obligations such as on-site affordable housing.

The refusal to enter into a required Section 106 Agreement may result in a planning application being refused.

Planning obligations are required to meet statutory tests. They must be:

• Necessary to make the development acceptable in planning terms;
• Directly related to the development; and
• Fairly and reasonably related in scale and kind to the development.

Section 106 funding is not a general community fund and is not compensation for any losses on the site. Section 106 cannot be used for anything other than their intended purpose (e.g. recreation, affordable housing, employment land, highways).

Sometimes, obligations that are essential to allow the granting of planning permission.

For example, new residential developments place additional pressure on existing social, physical and economic infrastructure in the surrounding area. Planning obligations aim to balance this extra pressure with improvements to the surrounding area to ensure that a development makes a positive contribution to the local area.

The obligations may be provided by the developers “in kind” – that is, where the developer builds or provides directly the matters necessary to fulfil the obligation.This might be to build a certain number of affordable homes on-site, or ecological enhancement, for example.

Alternatively, planning obligations can be met in the form of financial payments to the Council to provide off-site infrastructure works, contributions towards providing affordable housing elsewhere in the Borough, compensation for the loss of employment land, recreation contributions and contributions towards ecological enhancements. In some cases, it can be a combination of both on-site provision and off-site financial contributions.

Strategic Planning & Infrastructure determine the required planning obligations for developments in line with Bury Council’s development plan and supplementary planning documents.

View our supplementary planning documents.

The refusal to enter into a required Section 106 Agreement may result in a planning application being refused. S106 obligations can only be negotiated if there are particular circumstances can justify it.

Yes, each Section 106 Agreement is different and will include individual requirements as to how the contributions are spent. Section 106 funding is not a general community fund and is not compensation for any losses on the site. Section 106 cannot be used for anything other than their intended purpose (e.g. specific recreation projects, affordable housing, employment land, highways works).

New developments place additional pressure on existing social, physical and economic infrastructure in the surrounding area. Planning obligations aim to balance this extra pressure with improvements to the surrounding area to ensure that a development makes a positive contribution to the local area.

Section 106 funding cannot be used for anything other than their intended purpose. To understand how contributions are spent in accordance with our policies, you can view our spending frameworks below.

Developers are required to pay the Council’s legal fees for preparing the Section 106 Agreement.

Developers are also required to pay monitoring fees to cover the administrative costs that are incurred on tasks such as ensuring on-site measures are provided, financial contributions are received, and contributions are spent in accordance with the terms of the obligation.

The Council also compiles an annual Infrastructure Funding Statement which provides a summary of:

• Section 106 contributions paid to us in the current year
• Section 106 contributions committed for future years
• Projects delivered in the Bury borough via Section 106 Agreements in the current year.

View the Infrastructure Funding Statement.