LGA opposes Government's section 106 renegotiation proposals

"Any perception that councils are asking for unaffordable ‘nice to have’s’ through planning which in these difficult times is rendering development unviable is wrong," the response said. "In addition to much needed affordable housing, section 106 agreements also funds roads, street lights, new schools, and other facilities needed to support new development, access to jobs and unlock further economic activity."

The LGA said that councils are already renegotiating section 106 agreements voluntarily when necessary and said that the Government's newly proposed cut off date for allowing renegotiations of those agreements dated before 6 April 2010 was "unnecessary" and "arbitrary". It pointed to a number of case studies where local authorities were seen to take a proactive approach to unlock stalled sites.

These included Ashford Borough Council, which supported a developer in bidding for funding towards a new junction from the Get Britain Building fund and Bristol City Council which proactively seeks requests from developers to renegotiate unviable section 106 agreements and uses open book appraisals by the developer in the determination process.

The response said that it is not "overzealous" section 106 agreements that hold up development, but rather buyers' inability to buy at current prices and developers' inability to sell at less than current prices. Changes to section 106 will not help this problem, it said.

The LGA also said that could end up delaying, rather than speeding up, development. There is a risk that development schemes, which would otherwise have gone ahead, will now be delayed as developers will wait for the proposed new regime to be put in place to see whether their developments are eligible for renegotiation, it said.

The Government announced the consultation on its proposals to allow renegotiations of section 106 obligations that were agreed before 6 April 2010 in August this year and the consultation closed on 8 October.