Maximising the use of developer contributions to fund the NHS estate

Aahsan Rahman

January 28, 2020 | @NHSproperty

NHS services and infrastructure are under evermore pressure due to population growth and significant underfunding. For the NHS estate, it is therefore imperative that the NHS uses all available funding sources to ensure it can continue delivering quality patient care.

Developer contributions obtained through the town planning system are an example of these funding sources, and can provide an important contribution to meeting the cost of new or improved infrastructure as a result of new development in an area. There is a clear need for the NHS to maximise the capture of this funding from the town planning system to help support the delivery of much needed health infrastructure.

Contributions from development towards local infrastructure are collected primarily through two mechanisms: Section 106 (S106) planning obligations and the Community Infrastructure Levy (CIL). They are two different processes but work in parallel.

Legislative changes to these processes came into effect on September 2019, some of which could benefit the NHS. Of particular significance to the NHS is the removal of the existing pooling restrictions for the capture of S106 funding, the removal of requirements for Local Planning Authorities (LPAs) to produce Regulation 123 Lists (a list of infrastructure projects CIL funding may be spent on) and the introduction of requirements for LPAs to provide an annual infrastructure funding statement.

These changes might help streamline the process for NHS organisations seeking to fund health infrastructure projects through S106 and CIL, particularly by highlighting the lack of funding being allocated to health infrastructure compared to other public sector bodies.

As Reform’s report shows, whilst there are several successful examples of NHS bodies capturing funds, there remains a lack of a consistent approach to facilitate this activity and fully maximise the benefit. Furthermore, members of the NHS who are looking to capture funding without prior experience may not find this a straightforward task and are likely to need support from planning professionals.

As the only dedicated town planning team in the NHS, the NHS Property Services town planning team are currently finalising a series of practical guidance notes to help facilitate the capture of S106 and CIL funds and hope to help the wider NHS system capture much needed funding through sharing our knowledge and experience.

The NHS needs to do more to capture S106 and CIL funds from the town planning system. A co-ordinated, researched and technically supported strategic approach to fund capture will enable the NHS to maximise the benefit of this funding source to the benefit of the wider public.


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