Developers taken to court over £1.5m owed to city

Liverpool Council to Take Developers to Court Over £1.5m Unpaid Contributions

Liverpool City Council is set to take legal action against developers who have failed to pay more than £1.5 million owed to the city for community improvements, including parks, playgrounds, and affordable housing.

The money is owed under Section 106 agreements, which require developers to contribute towards local infrastructure or community facilities as part of their planning approval. The council says several firms have failed to meet their obligations, prompting a series of court cases this autumn.

According to a council report, three debts totalling £947,000 will go before the courts in October and November, while a further 11 firms, collectively owing around £465,000, are also expected to face legal proceedings.

Section 106 agreements, introduced in 1990, are legally binding contracts designed to offset the impact of new developments — for example, through funding for green spaces, traffic management, flood defences, or community amenities.

However, enforcement has long been an issue for local authorities, and Liverpool has faced criticism both for slow collection and for failing to spend money already received.

Last year it emerged that more than £17 million in developer contributions remained unspent across the city, sparking frustration among residents and councillors.

Liberal Democrat councillor Andrew Makinson, who uncovered the unspent funds through Freedom of Information requests, said the latest revelations showed both developers and the council had let communities down.

“Developers haven’t been paying what they owe — but the council also hasn’t been serious about collecting it or spending it,” he said.“It took since 2017 just to get new playground equipment installed at Calderstones Park, and now that money won’t go as far as it would have then. The community is being short-changed.”

Despite past criticism, the council said it was strengthening its systems for managing and enforcing developer payments.

In a statement, Liverpool City Council said:

“As part of our improvement journey, we now have robust procedures in place for recovering Section 106 contributions owed to the council for the benefit of residents.We are reviewing all processes around the management and delivery of these funds to ensure they are spent as efficiently as possible.”

The authority confirmed it would not yet name the developers facing legal action but said the Section 106 sub-committee had allocated nearly £4.9 million towards local projects scheduled for delivery in 2025–26.

Nationally, the system has come under scrutiny, with the Home Builders Federation estimating that around £6 billion in developer contributions remains unspent across the UK — a figure critics say highlights inefficiencies in how Section 106 money is managed and released.