Newspaper article The Evening Standard (London, England)

HCA Discovers That Time Is Money -- [Pounds Sterling]23m to Be Precise

Newspaper article The Evening Standard (London, England)

HCA Discovers That Time Is Money -- [Pounds Sterling]23m to Be Precise

Article excerpt

YOU could build 150 new homes with the [pounds sterling]23 million of taxpayers' money just flushed down the loo by the Homes and Communities Agency, which has just scrapped a seven-year initiative to build 2500 affordable homes on 16 sites across the capital.

You could probably build 66 more homes with the [pounds sterling]10 million or so wasted preparing plans by Countryside, Barratt, Willmott Dixon and First Base, the HCA's chosen development partners.

It is not possible to quantify the number of flats that could be built from the proceeds of a court case if the four developers decide to sue for unrecoverable costs and loss of profits over what was called The London Wide Initiative.

This was launched in 2003 by English Partnerships, predecessor to the HCA, which bought the 16 sites, then signed tortuous risksharing agreements with four even more tortuously chosen developers to build the 2500 homes, which are made affordable to rent or partbuy by government grants. At least one of the developers is considering legal action, after being told privately in January that eight of the sites where work has not actually started were to be put out to bid again.

The HCA, which took over proceedings in 2008, says the existing deal no longer represents "value for money". This may be because the HCA now estimates that 3284 cheap homes can be squeezed onto the 16 sites where a mere 2500 were to be built before.

Who knows? The developers have been trying to get the HCA's London head, David Lunts, to tell them why, without much success. Perhaps they should ask London Mayor, Boris Johnson, who chairs the London board of the HCA.

On April 1 the HCA was forced to reveal the cost of changing its mind. The annual accounts contain a [pounds sterling]21 million provision for paying the builders some of their costs and [pounds sterling]2 million to one canny enough to ask for loss of profits if the plan were to be abandoned. …

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