Local communities should not lose out on regeneration funding 

London Councils has today warned that local communities should not lose out on funds negotiated from developers to off-set the impact of new developments in their neighbourhoods - despite the Mayor of London's new planning powers.

The warning comes in the organisation's response to the consultation Opens in a new window on changes to the Mayor of London Order, which will determine how the Mayor's planning powers - due to come into effect in April 2008 - will work in practice.  

The boroughs are concerned that, if the Mayor uses his new powers to intervene in a planning application, he will be allowed to take over negotiating on section 106 agreements - meaning communities could lose out on valuable regeneration funds.

Section 106 agreements are funds negotiated by councils from developers to off-set the impact of a new development on the community. In 2005/6, the capital's boroughs negotiated £230 million from developers through section 106 agreements to spend on a range of benefits - from affordable housing to new transport links to youth centres in inner city areas.

London Councils argues that borough councils are best-placed to assess the measures needed to off-set the impact of new developments on their local area and has called for the Mayor to be excluded from negotiating section 106 agreements.