Summary: Mr X complains the Council failed to utilise money obtained through Section 106 agreements to carry out the highway improvements the funding was intended for. We found no fault in the Council’s actions.

The complaint

1. Mr X complains the Council failed to utilise money it obtained through Section 106 legal obligations to improve a highway junction in his town. He complained this was wrong because funds were paid to the Council by developers to allow improvements to be made when several large planning applications were approved in recent years.

Back to top

The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

Back to top

How I considered this complaint

4. I spoke to Mr X and considered his complaint and information he provided. I asked the Council for information and considered its response to the complaint.
5. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

Back to top

What I found

The Town and Country Planning Act 1990

6. Section 106 of the Act states that any person interested in relevant land can enter into a planning obligation (referred to as a Section 106 agreement). Section 106 agreements are legally enforceable. They can restrict development or specific operations, they can require land to be used in a specific way or they can require a sum of money to be paid to a local authority. Section 106 agreements may be conditional or unconditional.
7. Local Authorities are expected to use funding received from Section 106 agreements as set out in those agreements in order to make development acceptable in planning terms. The agreements often contain terms which state how and when the funds should be used and allowing for the return of funds if they are not used.

What Happened

8. Mr X complained the Council failed to comply with its obligation to use Section 106 funds make improvements to a junction near to where he lives.
9. Mr X explained there have been significant housing developments in his area. He commented about four of these large developments. When they were approved, they were subject to planning obligations under Section 106 of the Town and Country Planning Act. The obligations required funds to be paid for works that would mitigate the effects of the developments. All four made reference to the junction of concern to him.
10. Mr X’s complaint referred to;
• A planning decision in 2009 which was subject to a condition requiring a mini‑roundabout to be built at the junction, funded via a Section 106 agreement.
• An application in 2013 which noted capacity improvements could be achieved at the junction concerned. This was to be funded via a Section 106 agreement.
• Two applications in 2017 which were approved subject to Section 106 agreements to fund improvements at the junction, or an alternative highway improvement scheme.
11. The Section 106 agreements contain clauses specifying when the financial contributions must be spent by, and what should happen if the funds are not spent by that time. The Council stated the time period to use the funds is usually ten years from the date the contribution is received.
12. The crux of Mr X’s complaint is that the Council has not utilised the funds that were paid to the Council by developers and no improvement work has been carried out. He argues the Council should not hold these funds but use them to mitigate the effect of the development as intended.
13. In response to a complaint from Mr X about the matter, the Council stated only the contributions from the 2017 planning applications were solely for works to the junction. It stated the 2009 and 2013 applications were for unspecified improvement schemes or the use they could be put to was flexible. The Council stated it had ten years from the date of the receipt of the funds to spend them. It did not accept any fault.
14. In terms of the Council’s general practice, it told us that officers in various departments worked together to ensure funds were spent in a timely fashion. A database was maintained to track the funds and the dates they must be used by. A quarterly meeting was held to keep the funds and their intended uses under review. This oversight ensured funds were used before they expired and had to be returned.
15. The Council explained work with its Highway Improvement Programme included prioritisation of works and this included consideration of the use of Section 106 funds. However, Section 106 funds may not fully fund intended works, so the timing and delivery of schemes can be dependent on availability of other funding.
16. The Council confirmed to us that none of the funds received for the agreements raised by Mr X had been spent and no work had been carried out. It explained the reasons for this. It noted a condition requiring improvements at the junction in the 2009 planning permission had been removed by a later planning application. The proposed improvements in 2013 had not gone ahead, in favour of considering a more holistic approach to the traffic problems in the area. As a result of this a contribution had been made to help deliver a different improvement scheme.
17. The Council stated in the 2017 applications, a financial contribution had been received and it was working towards highway improvements in the wider area which included the junction concerned. The Council stated it anticipated the scheme would be implemented in 2026/2027.
18. As part of his complaints to the Council, Mr X referred to a separate proposal for limiting the passage of heavy goods vehicles through his town or parts of it. He suggested the Council should implement it.

Was there fault by the Council

19. The Ombudsman’s role is to review councils’ adherence to procedure in making decisions. Where a council has followed the correct process, considered all relevant information, and given clear and cogent reasons for its decisions, we generally cannot criticise it. We do not make decisions on a councils’ behalf, or provide a route of appeal against their decisions, and we cannot uphold a complaint simply because a person disagrees with a council’s decisions or actions.
20. Councils are entitled to seek Section 106 contributions from developers to help mitigate the effect of development. The timing of the payments varies depending on the circumstances of the planning application.
21. There is generally a time limit after which funds expire and must be returned if not used. The Council is aware of this and has processes to ensure it monitors and acts on the agreements within this. There is no agreed date for specific mitigation works to be carried out. There can be circumstances in which proposed works are not done. Section 106 agreements can allow for alternative or similar schemes to be funded via the monies received as a result.
22. In the examples of concern to Mr X, the Council has set out cogent reasons for not having carried out work or spent the Section 106 funds up to now. There is no evidence of fault by the Council.
23. While I understand Mr X wishes the Council to spend funds on improvements more quickly than it has to mitigate development, the Council is not required to do this. I recognise Mr X considers there is an issue with the impact of heavy goods vehicles using the town which he would like to see funded, however, this is a separate matter and not related to the Section 106 agreements Mr X complains of. The prioritisation of work and decision as to what highway work is carried out is a matter for the Council and not the Ombudsman.

Back to top

Final decision

24. There was no fault by the Council.

Back to top

Investigator's decision on behalf of the Ombudsman