Section 106 and healthcare: balancing long term benefit against short term pain

Matt CollersonThis month, we’re pleased to welcome Matt Collerson of APC Architects and Planners. Matt is a Chartered Town Planner who has a great deal of experience in planning new residential developments and solving complex planning issues. In this post, Matt discusses how GP practices can use a Section 106 agreement to improve services for an expanding local population and highlights some of the key issues involved.

If you’ve had a new development built in your area recently, you may well have heard talk of Section 106 agreements and how they can be used to benefit the local community, but what exactly are they? Section 106 agreements are legal agreements between a planning authority and a developer to ensure that certain works related to a development are undertaken or infrastructure items required as a result of a development are provided or funded by the developer.  For example, a Section 106 agreement would be used to ensure that a certain percentage of new homes within a development are ‘affordable’ or would require off site highway improvements before a housing development can be occupied.

For healthcare, Section 106 contributions will be a key source of private sector funding to ensure that medical facilities can be upgraded to deal with a population increase, particularly whilst Central Government funding for new facilities remains scarce. For larger schemes, particularly those in excess of 1,000 dwellings, it is quite common for a new medical facility to be provided on the site, often as part of a local centre.

So how can medical practices benefit from new development and how does the system work in practice?  Typically, once a planning application is submitted for a residential development the planning authority will consult with the NHS Region who will request a financial contribution towards local healthcare facilities. The extent of the contribution (often a per plot amount) is then set out in the agreement and paid to the Council based on a pre determined payment trigger, typically based on occupation of dwellings.

Whilst this source of funding is to be welcomed, it does have significant limitations in its scope and use, particularly in addressing any existing shortfalls in healthcare provision that may exist in a locality. Critically, Section 106 contributions can only be used to meet the needs resulting from a proposed development and has to be proportionate to the proposed scheme – it can’t be used to resolve existing problems.

Another difficulty and one that we see time and time again, relates to the timing of healthcare facilities on larger sites. Often, due to viability issues, key pieces of social infrastructure such as new schools and healthcare facilities are provided at the end of a development process. This offers a real problem to healthcare providers – existing services will come under increasing pressure as new residents move to the area with the new facility provided often years later. For a 1,000 dwelling scheme this could result in the provision of an extra 2,500 patients – highlighting the need for upfront delivery of infrastructure.

For healthcare providers looking to benefit from planned development, my advice would be to develop a clear strategy and vision for how the future healthcare needs of the area will be met based on future housing growth.  Following this, it is key to engage with the developer and planning authority and ensure that the delivery of new medical facilities, or off site contributions are prioritised and put to the top of the list, otherwise there is real prospect that existing facilities will be put under increasing pressure in the short term. Up front delivery of infrastructure or financial contributions at the outset of development are the ideal solution, but you will be competing with many service providers making a similar case!

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About Laura

Laura looks after Neil Mason Associates' marketing and PR, including the company's online and social media presence. When she's not working, she's likely to be found running after her two small girls or out on Warwickshire's country lanes on her bike.

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