It’s widely acknowledged that the UK needs more infrastructure investment: rail, the grid and energy systems are all routinely cited as needing significant upgrades in order to deliver national growth. But what’s less discussed is the need to strengthen social infrastructure. The Government’s Infrastructure Strategy, published last year, acknowledges that substantial investment is required in health, education and justice buildings to help maintain a healthy, educated and safe population. But beyond the public estate, investment is needed in the delivery and upgrade of the other spaces that help our society thrive; community and youth centres, social clubs and neighbourhood support networks, and green spaces that provide access to nature.
There’s a funding gap between what the UK needs to deliver in relation to physical and social infrastructure and what has been pledged. We need to urgently rethink how funds are deployed to support social projects.
The cost of delivering a modern and efficient public estate is a strategic national priority and has been allocated funding in the Infrastructure Strategy. The other facilities mentioned above, however, largely remain underfunded, with responsibility often delegated to local authorities. This is why recent figures on the volume of unspent contributions which are agreed and paid during the planning and development process - some of which could be unlocked for such projects - are surprising.
Almost £9 billion in developer contributions remain unspent
March data from the Home Builders Federation (HBF) calculates that £9 billion of contributions remain unspent across English and Welsh councils. The majority is £6.6 billion of unspent Section 106 (S106) funds, with £2.2 billion in Community Infrastructure Levy (CIL) contributions and £128 million held by Integrated Care Boards. Together, the HBF estimates the total value of unspent developer contributions is £9 billion - around £800 million (9%) higher than in 2024 – and that almost £3 billion of S106 and CIL money has been unspent for over five years.
While releasing S106 funds to projects other than those agreed with the developer at the outset will require significant legal changes, the HBF has suggested ways in which funds that remain unspent after five years could be reallocated without having to reopen S106 agreements. A quicker and easier win, however, could lie in unlocking the £2.2 billion of CIL contributions. This money sits in a ‘pool’ with the opportunity for it to be spent on a range of improvements that councils can choose to prioritise – these should include important social projects, alongside transport and other infrastructure.
The absence of systems to deploy funds effectively.
Projects such as Manchester’s Victoria North regeneration programme show this is possible: a long-term, place-based framework has pooled developer contributions and public investment to deliver social infrastructure alongside housing at scale. By establishing clear governance, shared priorities and long-term phasing, funding is directed into community facilities, open space and social assets as part of the growth strategy, rather than waiting for individual schemes to trigger spend. This kind of approach demonstrates that the challenge isn’t the absence of money, but the absence of systems to deploy it effectively.
Longer term, it should be possible for all parties to work together to review the broader developer contributions system. For developers, investors and government alike, key wins that could be derived from such a review include speeding up the delivery of investment, making the whole operation more efficient to maximise return, and increasing transparency and accountability to ensure investment reflects community priorities. The reward is significant: better community facilities, a stronger social fabric, and greater public confidence that development directly benefits local people.
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