Council has nearly £20m in unused developer funds

A local authority is sitting on almost £19.5m of unused funds meant for health, education and leisure projects.

Medway Council has received the contributions from developers which were granted planning permission, as reported by the Local Democracy Reporting Service (LDRS).

Their payments, called Section 106 agreements (S106), are sums given to support projects to benefit the community and limit the impact of new houses.

A spokesperson for Medway Council said: "The S106 team keep all potential and received contributions under review and work with the relevant services within the council, the NHS and other third parties to identify suitable projects that can utilise S106 funds."

After an agreement, developers can then begin work and pay the contributions when they reach a certain point in the construction schedule.

However, Freedom of Information (FOI) requests submitted by the LDRS show issues with money getting to where it was initially intended.

The report revealed as of December, the council held £4m of S106 cash for schools and education, £3.1m for community centres and museums, and £5.3m for open spaces.

Of the £4m agreed with developers since 2013, just £1.2m has been collected with only £17,846 spent.

In total, funding from 40 different agreements has been received by Medway Council, but only two projects have actually seen money spent.

A £9,446.36 sum from a 2014 agreement for development on Richmond Road, Gillingham, was used for "healthcare services".

The report also revealed another £8,400 was spent from a £9,197.96 agreement from 2020 for a development in Twydall, which was used for a health pod in the Woodlands Family Practice, Gillingham.

The LDRS reported the largest S106 contribution collected for a single development was £180,869.99 for a 300-home scheme on land at Otterham Quay Lane, Rainham.

This was agreed for improvements to GP services at the Rainham Healthy Living Centre, the Thames Avenue Surgery or the Maidstone Road Surgery.

The LDRS reported none of the money has been spent yet.

Out of the five towns and Hoo Peninsula, Chatham is the place with the most health-based S106 funding currently held by the council, which is £406,000.

The LDRS added if the fund was not spent by a certain deadline, the developer could request the money be returned.

Deadlines range between five and 10 years but Medway Council said it had never had to return any funding.

However, another FOI submitted by the LDRS revealed £175,000 of S106 funding agreements for health projects was allowed to expire before the money was collected by the council.

Medway Council chief planning officer Dave Harris told the LDRS the issue of getting the NHS Kent and Medway Integrated Care Board (ICB) to request the funds collected "had been a long-term frustration".

He said the council was having regular meetings with the ICB to discuss how to use the available funds as the local authority was unable to spend the money on services itself.

An ICB spokesperson said: "We request S106 funding when there is an identified and approved project to allocate the funding to.

"Where we have an opportunity to pool S106 funding contributions, we will sometimes do so where appropriate."

The spokesperson added there can be a "significant lag" between the S106 contribution being secured, the development and getting to a point when the contribution is due.

"Due to the time lag, the ICB may consider a different project from that proposed originally is required and we will discuss this with Medway Council," they added.

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