A leading social research charity has warned the government not to tamper with the section 106 system for affordable housing, in the light of Treasury economist Kate Barker’s proposal for a planning gain supplement.

Sources at the Joseph Rowntree Foundation have cautioned against adopting a version of section 106 that is too slimmed down, after research it conducted with the Housing Corporation indicated that half of all affordable homes are built using section 106 money.

The Treasury is considering the reduced version of section 106, solely for affordable housing, to be used in conjunction with Barker’s proposed planning gain supplement. This supplement would be in the form of a predetermined payment from developers to finance infrastructure on the government’s housebuilding schemes.

Lord Best, JRF director, said that any plans for such a supplement had to be combined with a robust section 106 system.

He said: “Supplements could simplify negotiations on matters other than social housing. However, the affordable housing element

has to be the subject of separate, specific planning requirements using the section 106 system.”

Section 106 agreements are becoming increasingly important in providing affordable homes because housing associations are finding it harder to acquire land through more conventional means.