Planning obligations are agreements entered into between the council and developers, usually in conjunction with the granting of planning permission. They apply to land, binding it and whoever owns it. Made using powers under section 106 of the Town and Country Planning Act 1990, they are also known as 'Section 106 agreements'.
Planning obligations 'are intended to make acceptable development that would otherwise be unacceptable in planning terms', as defined in the government's Circular 05/2005: Planning Obligations. They can involve direct works or actions by the developer, and/or financial contributions to the council.
l Prescribe the nature of a development (by requiring that a given proportion of housing is affordable, for example)
l Secure a contribution from a development to compensate for loss or damage created by a development (loss of open space or community facility, for example)
l Mitigate a development's impact (through increased public transport provision or financial contribution towards school places, for example).
According to Circular 5/2005, planning obligations also have to be:
l Relevant to Planning.
l Necessary to make the proposed development acceptable in planning terms.
l Directly related to proposed development.
l Fairly and reasonably related in scale and kind to the proposed development.
l Reasonable in all other aspects.