Section 278 agreements and what the highway authority wants

A section 278 agreement is the contract under which you pay for works to the public highway that the highway authority will own and maintain afterwards. It comes from section 278 of the Highways Act 1980, it sits outside the planning permission, and it is the item on a development programme most likely to slip. Technical approval of the detailed design, a bond, inspection and supervision fees, a commuted sum for anything non-standard, and traffic regulation orders where the works change restrictions on the street. None of that is dealt with by the planning condition that triggers it.

Treat the agreement as a parallel project with its own timetable from the day permission is granted.

What a section 278 agreement covers

The agreement covers works to an existing public highway carried out at the expense of someone other than the authority. A new site access, a widened junction, a signalised crossing, a bus stop relocation, footway reconstruction, dropped kerbs, drainage connections into the highway drain and street lighting alterations all fall within it.

Section 38 of the same Act is the separate agreement for the adoption of new streets built within the site. On a residential scheme of any size you will usually need both, and the two are negotiated with the same team but secure different things.

The identity of the highway authority depends on the road. A county council or unitary authority for most roads, Transport for London for the Greater London Authority road network, and National Highways for the strategic road network. Where a site access affects more than one of those, expect two technical approval processes and no coordination between them unless you create it.

When the highway authority requires one

Any permanent alteration to the public highway needs the authority's agreement, so the trigger is physical rather than a matter of scale. A single dropped kerb for a driveway is handled through a simpler vehicle crossing application in most authorities, but anything that changes the alignment, the drainage or the signing of the carriageway heads towards section 278.

The link to the planning permission is usually a condition. The common forms are a condition preventing development starting until the agreement has been entered into, and a Grampian condition preventing occupation until the works have been completed to the authority's satisfaction. Read the condition carefully, because the two have very different consequences for cash flow.

Where the works were identified in a transport assessment or a transport statement, the mitigation described there becomes the scope of the agreement. Describing mitigation loosely at application stage therefore creates a negotiation later about what you actually promised.

Technical approval and design submissions

This is the stage developers underestimate. The drawings submitted with the planning application are not the drawings the highway authority will approve.

Technical approval normally requires a full detailed design: setting out, levels, construction build-up, drainage design and calculations, lighting design and calculations, signing and lining drawings, structural details where there are retaining elements, and a road safety audit with the designer's response to each recommendation. Audits are carried out at defined stages, with a design stage audit before approval and later stages at completion and after a period of operation.

Three practical points shorten it:

• Appoint a highways designer who has worked with that authority before, because local standard details and approval procedures vary more than the national guidance suggests
• Submit the design once, complete, rather than in instalments
• Identify statutory undertakers' apparatus early and request diversion estimates, because utility lead times, not the authority, are usually what delays the start

Where the works change parking or waiting restrictions, a traffic regulation order is needed. That process has its own statutory consultation and can attract objections, which is why it should start as early as the design allows.

Bonds, fees and commuted sums

Expect several separate amounts, and expect them to be payable at different points.

Fee levels and bond percentages are set by each authority and published in its fee schedule, so check the current schedule rather than budgeting from a previous scheme. The commuted sum is the one that surprises people: specify block paving, a feature surface, a structure or bespoke lighting and you may be asked to fund its whole-life maintenance in advance. Choosing standard materials is usually the lower cost design decision.

Programme risk and the link to planning conditions

Section 278 work sits on the critical path and depends on a third party, which is the definition of programme risk.

1. Agree the scope of works in writing before the planning application is determined, so the condition matches the design
2. Instruct the detailed design immediately on grant of permission, not after the site is bought
3. Request utility diversion estimates in parallel with technical approval
4. Start any traffic regulation order process as soon as the layout is fixed
5. Keep the legal negotiation running alongside the technical approval rather than after it
6. Build a realistic allowance into the build programme for the authority's review cycles

Where a condition prevents any development starting until the agreement is completed, the authority holds the timetable. That is worth arguing about at application stage, where a condition tied to a later trigger such as first occupation of a dwelling may be acceptable for works that do not need to exist during construction.

Who carries out the works

Three models are in use. The authority's own term contractor builds the works and recharges the developer. The developer's contractor builds them under the agreement with the authority supervising. Or a hybrid, where works in the live carriageway go to the term contractor and everything behind the kerb line goes to the developer.

Authorities differ, and some insist on their own contractor for anything involving traffic management on a classified road. Ask the question at the first technical meeting, because the answer changes the cost by a large margin and determines who carries the programme risk.

Whoever builds, the works are street works, so the permit and notice regime under the New Roads and Street Works Act 1991 applies, along with the traffic management requirements that come with it. Drainage connections raise their own ownership questions, covered in our note on highway drainage, gullies, connections and who maintains.

Handover and the maintenance period

On completion the authority inspects, issues a certificate of practical completion and starts a defects or maintenance period, commonly a year. During that period the developer remains responsible for remedying defects and the bond stays in place.

At the end, a final inspection, a final completion certificate, release of the bond and adoption of the works as maintainable at public expense. Chase this. Unreleased bonds and unclosed agreements sit on balance sheets for years, and the paperwork is much easier to assemble while the contractor is still trading.

Keep one file containing the agreement, the approved drawings, the audit reports and responses, the as-built records and the completion certificates. A purchaser's solicitor will ask for all of it, and construction traffic arrangements during the works should be consistent with the construction traffic management plan submitted for the planning condition.

This is general guidance, not legal advice. Check the position with your local planning authority, the highway authority or a qualified professional before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.