Local authorities in England and Wales are holding more than £9 billion in unspent developer contributions – money meant for schools, healthcare and affordable housing that is instead sitting idle in council accounts.
A Freedom of Information survey by the Home Builders Federation (HBF) found that councils hold £6.6 billion from Section 106 agreements and over £2.2 billion from the Community Infrastructure Levy. Around £3 billion of this has been unspent for more than five years.
Scale of the backlog
The research, which received responses from 243 local authorities, reveals the average council holds £19 million in unspent Section 106 contributions and £13.9 million in unused CIL funds.
The figures are particularly stark in parts of London. The Borough of Tower Hamlets alone holds over £260 million in unspent contributions. In Hammersmith and Fulham, which sits on £30.5 million in affordable housing contributions, average house prices are 16 times average earnings.
Healthcare infrastructure is also being held back, with £320 million earmarked for new facilities remaining unspent across England and Wales.
Neil Jefferson, chief executive of the Home Builders Federation, said: “This money should be funding schools, healthcare, affordable housing and other essential local infrastructure, yet billions sit idle, in some cases for over five years. Investment in new housing brings huge economic and social benefits, but far too many of these advantages are going unseen by local communities.”
Impact on housing delivery
The scale of unspent contributions raises questions about local government capacity at a time when the government is struggling to meet its housing targets. Annual government expenditure on Affordable Housing grants runs at around £2.5 billion to £3 billion – meaning the unspent S106 and CIL pot could fund up to three years of new affordable homes if deployed.
This follows Residential Landlord’s coverage of planning reforms that could unlock thousands of new homes through a second chance for rejected applications. The developer contributions backlog suggests the problem extends beyond planning approvals to the infrastructure that enables housing delivery.
For landlords, stalled infrastructure investment means continued supply constraints in high-demand areas. Without schools, GP surgeries and transport links, councils struggle to approve major housing developments – keeping rental stock tight and competition for properties intense.
The HBF has called on ministers to address the capacity crisis in local government that is preventing contributions from being spent. Without intervention, billions more could accumulate while housing lists grow and infrastructure gaps widen.
Full data from the Home Builders Federation research is available on its website.
Opinion
Nine billion pounds sitting in council accounts while families wait years for affordable housing tells you everything about the gap between policy and delivery. Councils blame capacity constraints. Developers blame slow-moving bureaucracies. Meanwhile, the communities these funds were meant to serve continue waiting. The government talks about unblocking housing – perhaps it should start by following the money that has already been paid.
