“Systemic problems” in developer contribution system and council staffing, MPs warn

The cross-party Parliamentary committee also criticised issues around local plan adoption, citing figures showing that the number of local planning authorities with an up-to-date local plan has fallen by almost half over the last six years.

The findings come in a committee report on the developer contributions system, which analysed the effect of Section 106 agreements and the Community Infrastructure Levy (CIL) on housebuilding.

Published on Friday (17 October), the report claimed that the system "is not working as effectively as it should to ensure the impact of new development on local areas is mitigated and the right infrastructure is in place".

It said there are "systemic" problems within the planning system that make it difficult for local planning authorities (LPAs) to ensure they receive the right amount of developer contributions.

It also noted that in February 2025, only 86 LPAs – 29% of all the LPAs in England – had an up-to-date local plan, compared with 149 LPAs in February 2019.

"Additionally, in November 2024 only 52% of LPAs were operating a CIL, and it seems likely that more LPAs across the country would benefit from introducing it," the report said.

It added: "Capacity and capability problems also mean there are not enough planners in LPAs to meet an increasing workload, and experienced planners are being lost to the private sector."

It said that staffing issues in LPA teams were "largely due to the working environment, caseloads and pay, and many planners find opportunities in the private sector more attractive".

The committee also warned of an "imbalance" in capacity and capability between the public and private sectors, with larger developers benefiting from specialist negotiation skills.

The Government has committed to providing around £12m for the recruitment and retention of planners, for a graduate scheme, and to encourage more mature professionals with multidisciplinary expertise into LPAs.

However, the committee said it is "unconvinced" that the Ministry of Housing, Communities & Local Government is adequately addressing staffing capacity and capability issues within local planning authorities.

It also raised concerns about the issue of unsold developer-funded homes after hearing evidence from the Home Builders Federation that at least 17,000 affordable housing units, provided through Section 106 agreements between developers and planning authorities, are sitting unsold.

Elsewhere, the report stated that the Government does not have enough data on Section 106 or the CIL in England.

The Government requires all local authorities that receive Section 106 monies or the CIL to publish annually an infrastructure funding statement. These statements are the Department's main source of data about developer contributions, and it reviews them annually.

However, the report noted that the reviews are incomplete because they do not include data from LPAs that fail to produce an infrastructure funding statement, which accounted for 17% of LPAs as at December 2024.

In response, the committee recommended that the Department ensure that LPAs are completing infrastructure funding statements in line with their statutory duties.

It also called on the Department to improve its data collection from infrastructure funding statements.

On out-of-date local plans, the committee recommended that the Department provide further details of how it will use its statutory powers to ensure that LPAs produce an up-to-date local plan, and if it will examine the local plan-making system to make it simpler and shorter, drawing up a revised local plan.

Sir Geoffrey Clifton-Brown MP, Chair of the Public Accounts Committee, said: "The Government has understandably reached for planning system reform as a lever to unlock growth. Our report demonstrates the scale of some of the problems it has to unpick, in particular the drought of planners in local authorities.

"Without a functioning pipeline of highly-skilled planning professionals, councils will continue to be outmanoeuvred in any negotiation with developers in affordable homes negotiations.

"Given the Government's ambitions for huge increases in housing numbers, there are valid concerns that infrastructure construction will lag behind. It's even more important that the developer contribution system works properly to keep up with planned supply."

An MHCLG spokesperson said: “We know there is an issue here that needs fixing if we are to end the housing crisis we inherited.

“We are currently working closely with developers, providers, and councils on a solution that will get Britain building and solve the legacy problem of uncontracted and unsold affordable homes.”

Adam Carey