Funding education through developer contributions will be challenging, by Richard Garlick

New guidance from the Department for Education (DfE) reinforces the message in recent planning guidance revisions that new school places necessitated by development should be funded through developer contributions.

The March national Planning Policy Guidance amendments encouraged councils to fund schools and other education buildings through developer contributions. Paragraphs 007 and 008 of the section on planning obligations say local authorities should "agree the most appropriate developer funding mechanisms for education, assessing the extent to which developments should be required to mitigate their direct impacts".

The revised guidance also states that central government funding for schools is"reduced" to "take account of developer contributions, to avoid double-funding of new school places".

DfE has published two new non-statutory guidance documents which it said "provide advice for local authorities on how to plan for new school places that are required due to housing growth, through the provision of new schools or expansions to existing schools." These outline general principles, such as that central government grants and other forms of direct funding do not negate the need for developers to mitigate the impact of development on education. The Planning Officers Society,which represents public sector planners,says that this is the first time that planning guidance has said that funding for education development will, like much affordable housing, be sourced from developer contributions rather than from central government. They say that, although many authorities have in the past collected contributions through s106 and the Community Infrastructure Levy (CIL) to support education provision, this is the first time that the approach has been clearly set out in planning and education guidance, becoming government policy rather than a matter for local discretion.

They and other commentators have expressed concerns that the planning system is being asked to resource too many competing priorities.

One consultant told us that the policy could lead to conflict between departments in unitary authorities – where education, housing and planning sit within the same organisation – or between district planning authorities and education authorities in top tier councils. The Royal Town Planning Institute has raised concerns about how additional school places would be funded in areas where housing need is high but values low.

POS says that the policy risks creating a competition for available contributions between education on the one hand and affordable housing and other necessary infrastructure on the other.

Of course, the idea that the education facilities needed to support development should be funded out of the land value increase created by granting permission for that scheme is sound in principle. But the current system struggles to capture enough of the increase to provide the infrastructure needed to ensure sustainable development. The government’s reinforcement of advice on securing developer contributions to meet education need is going to make the task even more challenging.

Richard Garlick, editor, Planning // richard.garlick@haymarket.com


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