The research, which was commissioned by the Department of Communities & Local Government (CLG) and published today by CLG, shows planning obligations have led to the very substantial investments by developers.

The planning obligations, known as S106 agreements, are negotiated by local planning authorities when granting planning permission for new developments. These obligations ensure that the necessary infrastructure to support new developments is in place and also that developers of private housing schemes create mixed communities by providing an element of affordable housing on new private estates.

The researchers, from the University's Department of Town and Regional Planning, found that nearly two thirds of new affordable homes are now provided through S106 agreements. In principle many of these contributions are funded by developers from the increase in land value brought about by the granting of planning permission.

Until recently little was known about the extent and value of these obligations but the new Sheffield study indicates how substantial these contributions are.

In 2005-06 they amounted to approximately £4 billion of developer contributions, of which half was for new affordable housing. This represented over a 50% increase in the value of all contributions since 2003-04, the increase reflecting both the greater capability of planning authorities when negotiating contributions and the rise in development values providing the funds for developers to make their contributions.

The research showed that planning authorities were increasingly focusing their efforts on the largest sites, with 57% of all new homes and 80% of all new commercial floors-pace covered by permissions which had obligations attached to them.

It further showed that there were large variations in the extent to which planning authorities negotiated agreements and in the value of the contributions secured. This was partly due to the variations in demand for development and land values but also to significant variations in local authority policy and practice.

Professor Tony Crook, from the University's Department of Town and Regional Planning, who led the research team, said:

"The last decade of this century has seen a very substantial increase in these contributions by developers facilitated by the significant increase in land values.

"The size of the country's future requirement for new homes will require a substantial investment in infrastructure to support it, whilst the new homes targets of the Government includes increased targets for affordable homes.

"The Government's proposals for changes to S106 policy, including the new Community Infrastructure Levy, will bring more sites into the frame for contributing to infrastructure because the Levy will apply to all but householder applications and the smallest sites and thus these proposals have the capacity for further raising the funds available for infrastructure. Success will also depend on the continued capacity and capability of local planning authorities to set the Levy and to negotiate S106 contributions as well as the continuing capacity of the development industry to fund these."



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