Section 106 monitoring fees and what they cover

An s106 monitoring fee pays for the officer time an authority spends checking that the obligations in a planning agreement are actually performed. It is not a contribution towards infrastructure, it does not fund the affordable homes or the bus service, and it should not be treated as a rounding item in the appraisal. On a large agreement with many triggers it can run to a five figure sum.

Monitoring fees used to be argued about because their legal basis was uncertain. That argument has largely ended, but the question of how much is reasonable has not.

What the fee is charged for

Monitoring is the work of checking. Verifying that a notice of the start of development was served. Confirming that the affordable units were transferred to the named registered provider on the agreed tenures. Reading the annual travel plan monitoring report and chasing the survey that was not submitted. Checking that a contribution indexed to a tender price index has been calculated correctly. Issuing a compliance certificate at the end.

None of that is free and none of it is covered by the planning application fee, which relates to determining the application rather than to administering what follows.

What the fee should not cover is equally clear. It is not a charge for negotiating the agreement, which is dealt with through legal costs. It is not a general contribution to the council's planning service. And it should not be charged against obligations that require no monitoring, such as a restriction that is either complied with or breached and needs no periodic check.

The statutory basis for charging

The Levelling-up and Regeneration Act 2023 inserted express provision into section 106 of the Town and Country Planning Act 1990 allowing a local planning authority to require a sum to be paid towards its monitoring costs, provided the sum is fair and reasonable and relates to monitoring the obligations in the agreement.

Before that, authorities relied on general powers and the position was contested, with some developers refusing to pay and some inspectors declining to attach weight to the fee. The express provision has settled the principle, so the sensible negotiation now is about quantum and method rather than about entitlement.

National guidance on planning obligations reinforces the proportionality point. Monitoring fees should be proportionate and reasonable, authorities are expected to publish what they charge, and the charge should reflect the monitoring the agreement actually requires.

How fees are usually calculated

Three methods are in general use, and they produce very different numbers on the same agreement.

The percentage method is the one to scrutinise. A scheme paying a large education contribution generates no more monitoring work than a scheme paying a small one, because the monitoring task is the same: confirm the trigger, confirm receipt, confirm the index calculation. Where an authority applies a percentage without a cap, ask for the cap.

The flat fee per obligation is usually acceptable once the schedule is cleaned up. Go through the obligations and identify those requiring no active monitoring, then ask for those lines to be removed from the count.

The tests an obligation must meet

Obligations relied on as a reason for granting permission must meet the regulation 122 tests in the Community Infrastructure Levy Regulations 2010: necessary to make the development acceptable in planning terms, directly related to the development, and fairly and reasonably related in scale and kind.

Whether a monitoring fee is itself subject to those tests has been debated. The safer position for a developer is to treat it as though it were, and to ask the authority to explain how the sum sought is related in scale and kind to the monitoring work generated by this agreement.

That request is usually productive. An officer who has to justify a figure line by line will often reduce it, particularly where the schedule includes obligations that need no monitoring or where the same trigger is counted twice.

Challenging a disproportionate fee

Four steps, in order, and the first two resolve most cases.

1. Ask for the basis. Request the published schedule, the method applied and the calculation for your agreement. An authority charging under a published policy will produce it. One charging without a policy often reconsiders.
2. Negotiate at heads of terms. A monitoring fee agreed at that stage, with the obligations requiring monitoring identified, is far easier than an argument on an engrossment two days before a committee deadline.
3. Compare with neighbouring authorities. Not as an argument of principle, since each authority sets its own, but as evidence when asking for the method to be explained.
4. Preserve the point for appeal. Where a resolution is subject to an agreement you consider unreasonable, record your objection in correspondence. An inspector determining an appeal can decline to attach weight to an obligation that fails the statutory tests.

Refusing to include the fee at all is a high risk strategy on a scheme with a committee resolution and a deadline attached. Most developers pay and negotiate the number.

Reporting after completion

The obligations do not end at completion of the agreement, and neither does the developer's administrative burden.

Most agreements require notice of the start of development, notice of occupation of specified units, submission of travel plan monitoring reports, and evidence of affordable housing transfer. Missing a notice is a breach even where the underlying obligation has been met, and it is the commonest way a developer finds itself in correspondence with a monitoring officer.

Build the notices into the development programme as tasks with owners. A Travel Plan with a five year monitoring period will outlive the project team that agreed it, and the obligation transfers with the land.

Where affordable housing is involved, the Affordable Housing Statement submitted with the application should already describe the tenure mix and transfer arrangements the monitoring officer will check against.

Infrastructure funding statements

Authorities have to publish an infrastructure funding statement each year, by the end of December, covering the previous financial year. It reports receipts from the levy and from planning obligations, what has been allocated, and what has been spent.

That document is worth reading for two reasons. It shows whether the contributions a scheme paid have been spent on the purposes they were collected for, which matters when an authority asks for a further contribution towards the same project. And it usually sets out the authority's monitoring fee policy alongside, which gives you the published basis to ask about.

The same public record principle applies to applications generally, and the routes into it are covered in the guidance on tracking a planning application on the public register. Where a scheme's viability is tight, the monitoring fee belongs in the appraisal inputs that feed the Viability Assessment, not in a contingency line.

This is general guidance, not legal advice. Planning obligations create binding legal commitments, so take advice from a solicitor before entering into one. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.

Browse all 66 report types at PlanScope.