Newspaper article The Evening Standard (London, England)

Creative Accounting; Mayor Ken Livingstone Is Making London Developers Pay for Much-Needed Homes for the Low Paid. Mira Bar-Hillel Sees the Scheme at Work

Newspaper article The Evening Standard (London, England)

Creative Accounting; Mayor Ken Livingstone Is Making London Developers Pay for Much-Needed Homes for the Low Paid. Mira Bar-Hillel Sees the Scheme at Work

Article excerpt

Byline: MIRA BAR-HILLEL

MAYOR Ken Livingstone wants 50 per cent of all new housing in London to be affordable and he is turning to developers for the answer. Every time they want to build on a prime site, developers must now put large sums of money in the council's kitties for renting or shared ownership through housing associations.

The requirement began in 1996, when the affordable element had to be provided on schemes in inner London of 30 dwellings or more. This was revised in 1998 to schemes of 15 or more homes.

Officially, affordable homes should be part of the proposed development.

However, the rules also allow for the affordable element to be provided elsewhere, as long as payments for offsite affordable housing are tightly controlled.

In most parts of London, house prices do not vary much from one street to the next. However, in boroughs such as Westminster and Kensington and Chelsea they do, and cash payments on schemes in the most expensive neighbourhoods can provide more units if they are built in cheaper districts.

Since 1996, Kensington and Chelsea council has received [pound]5.6 million and spent about [pound]3.4 million on 98 units, of which 20 are complete. The clearest example is Westminster, which, since 1996, has collected nearly [pound]7 million from the developers of 20 schemes. So far it has used [pound]4.24 million of it to create 238 affordable homes and a 55-bed hostel and day centre.

Even before 1998, large payments were being offered by housebuilders and developers for these offsite homes. Frogmore and Galliard Homes offered [pound]1 million to Lambeth Council for permission for two additional blocks in the existing courtyard of County Hall (now completed), and offered [pound]700,000 to Kensington and Chelsea for the redevelopment of part of the former Brompton Hospital site. The unofficial "tariff" for these payments was initially [pound]500,000 for 100 two-bedroom flats.

Three years ago, the London Planning Advisory Committee, which is now part of the Mayor's office, increased this recommended tariff to [pound]1. …

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