London mayor Sadiq Khan would rather sup with the devil than a developer, even though the latter might be able to help with a looming political liability: namely broken promises on affordable housing delivery.
Late last year, the clubbable Lord Bob Kerslake was tasked with finding a fix. Last Friday, he delivered a 96-page report, which will provide ‘we are trying’ political cover to Khan. But Bob Kerslake’s fixes will essentially fix nothing, as the true reasons things are broken have not been probed. Some lie at your always-closed door, Mr Mayor.
Kerslake’s solution is to create another quango called City Hall Development and install a bureaucrat to oversee the six GLA quangos supposed to deliver affordable homes. He puzzlingly singles out the Transport for London model as a way to make “greater progress”. Really? The 79-strong property subsidiary only started 1,778 out of the 10,000 homes it was supposed to have built between April 2016 and March 2020. An organisation that specialises in ‘stack ‘em high’ shoeboxes will have you believe it will start 10,400 units in the next two years.
City Hall can do more than install another bureaucrat with a shoelace for a whip
TfL’s woes are a public proxy for those suffered by private developers. Here’s an example, altered in scale to protect the despairing developer. In 2015, XYZ Estates bought a 15-acre site for £100m, a sum based on a local plan suggesting 1,000 homes could be built, as long as 15% were affordable and the borough was gifted a leisure centre. Year two: plans are submitted. They go to the GLA for approval in 2017. Boris is gone, Khan’s now mayor. The affordable demand doubles to 30% – plus that free leisure centre.
In 2018, the bulked-up plans are resubmitted, containing 1,300 homes. The borough recoils in horror. Widely spaced meetings with planning officers consume 2018 and 2019. In 2020, a new application is submitted and recommended for approval, only to be rejected in 2021.
You can argue that affordable rule changes are a developer’s risk and that if it cannot now afford the affordable homes, they should sell the site at a loss. But there is also a loss to the community; nearly 400 affordable homes left unbuilt for years.
Khan’s 2021 manifesto promised to continue “the record-breaking progress on increasing the numbers of genuinely affordable homes”.
Disingenuous PR. He was given £3.15bn by government in 2016 against a promise to provide ‘at least’ 90,000 affordable homes by April 2021. Another £1.67bn was advanced in 2018, lifting the target to 116,000. The timeframe was extended to April 2023 due to Covid. Official figures show 56,239 were built, or were being built, by the end of 2021.
Starved planning system
A starved and sclerotic planning system is of course a major part of the problem. As RTPI chief executive Victoria Hills has confessed, planning “now feels like a system that has moved from crisis into critical care”. CBRE head of residential research Jennet Siebrits says it would help “if the mayor would provide additional resources to help resource-constrained planning departments”.
Whitehall is not about to infuse the system. But City Hall can do more than install another bureaucrat with a shoelace for a whip.
Figures from CBRE (above) show that since Khan became mayor, the time between application and grant has stretched from nine to 15 months. Why? Can’t just be that old Aunt Sally, the ‘planning system’. Worse, far worse, the average time between permission being granted and rolling the excavators on site has jumped from 15 to 19 months during Khan’s tenure. Developers can and do delay for reasons of their own. But they also curse the delays they lay at the closed doors of City Hall.
At a guess, I’d say the murderously slow, gaspingly expensive, post-permission march towards satisfying grasping ‘Section 106’ planning obligations is much to blame. A fix that may lie in your gift, Mr Mayor. But you need to sup with the devil to find out how.
Peter Bill is a journalist and the author of Planet Property and Broken Homes