Understanding how £29 million in developer funds could shape Coventry’s future
The Issue at Hand
At a recent Coventry City Council meeting, it was revealed that £28 million of unspent planning agreement money is currently held by the local authority. This money could — and should — be used to fund social housing, schools, health facilities, and local infrastructure.
The news has raised a few eyebrows across the city. Last year, the Coventry Society met with residents at the new Bannerbrook Park estate, who raised issues about the lack of school places and poor access to health services — problems that planning agreements are designed to address.
The topic also came up at our annual heritage conference, where attendees raised a lot of issues about infrastructure funding and delivery.
What Are Planning Agreements?
Planning agreements, often called Section 106 (S106) agreements, have been around for more than 30 years.
They are legal agreements between developers and the Council, used to ensure that new developments help fund the local services they rely on.
For example, when a developer builds 25 or more homes in Coventry, they are usually required to:
- Contribute to schools, health services, transport, and open spaces
- Ensure that 25% of homes are affordable (usually purchased by housing associations)
Typically these agreements are used to support the cost of off-site works that can’t be built as part of the development. For example a new development might need improvements to access roads. A smaller development might not have space for a play area, and an agreement might include a contribution to enhancing a park outside the development.
These agreements are a crucial tool for making growth sustainable and inclusive.
Who Do They Apply To?
It’s not just private developers who sign these agreements — housing associations and community developers are also included.
For instance, Citizen Housing will be required to contribute over £5 million in planning agreement funds to improve health and education facilities as part of the Spon End estate regeneration.
What About the Community Infrastructure Levy (CIL)?
Some councils also use a local tax called Community Infrastructure Levy (CIL) to collect funds from developers.
However, Coventry City Council decided in 2021 not to adopt the CIL system, instead continuing to rely solely on Section 106 agreements.
The Current Picture in Coventry
Every council must publish an Annual Infrastructure Funding Statement. Coventry’s latest report (covering 2023/24) offers some telling figures:
- £29 million in new planning agreements were signed in 2023/24 (up from £20 million in 2022/23)
- Over 400 affordable homes were agreed as part of these deals
- The Council received £4 million from earlier planning agreements during 2023/24
- As of March 2024, Coventry retained £20 million, rising to £29 million by October 2025
Expenditure (2023/24):
- £1.4 million – Education
- £0.75 million – Transport & Travel
- £0.37 million – Health Services
- £0.26 million – Open Space & Leisure
- £0.13 million – Monitoring & Management
Why the Delay?
If so much money is available, why isn’t it being spent faster?
Planning agreements are complex and time-consuming. They can take over a year to negotiate, and payments are often staggered over the life of a development — sometimes not fully delivered until the mid-2030s.
Developers can also challenge the financial terms, claiming that contributions make projects “unviable.” This can lead to reductions in affordable housing or infrastructure funding.
What It Means for Coventry
Planning agreements remain vital to building the city’s future — funding everything from schools and surgeries to green spaces and homes for families in need.
But to make the most of them, Coventry must ensure that:
- Funds are spent promptly and transparently
- Negotiations protect community interests
- Infrastructure keeps pace with development
The £29 million in retained funds represents both a significant opportunity and a serious responsibility for Coventry’s leaders.