It relates to money paid by developers to local planning authorities in order to offset the costs of the external effects of development. For example, if a developer were to build 100 new houses, there would be effects on local schools, roads etc., which the local authority would have to deal with. In that situation, there might be a Section 106 agreement as part of the granting of planning permission. The agreement might also entail provisions about production of social housing. The developer might agree to make a contribution towards the provision of new schools or traffic calming on local roads.