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Section 106 agreements deliver £4 billion-worth of infrastructure a year, study shows

A study by the University of Sheffield has revealed that private developers fund a total of £4 billion-worth of local capital infrastructure a year in England through Section 106 agreements.

The research, commissioned by Communities and Local Government and published today (6 August), shows that developers now fund many infrastructure projects, including roads, schools and new affordable housing.

The university’s department of town and regional planning found that nearly two-thirds of affordable housing is provided by Section 106 agreements.

The study also found that planning authorities are now targeting the largest sites to pin Section 106 agreements to, with 57 per cent of all new homes and 80 per cent of commercial floor-space covered by Section 106 agreements.

Sheffield University’s Tony Crook said: ‘The government’s proposals for changes to Section 106 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 Section 106 contributions as well as the continuing capacity of the development industry to fund these.’

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