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Friday18 August 2017

London Assembly calls on Boris to end 'dodgy development deals'

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London Assembly recommends ending secret planning deals by making developers publish viability assessements

The chair of the London Assembly’s planning committee Nicky Gavron has called on Boris Johnson to call a halt to “dodgy development deals” and pass planning guidance which would require viability assessments to be made public.

A former deputy mayor, Gavron, who has dubbed the assessments a ‘dark art’ of the planning system, spoke out after the publication of a London Assembly inquiry into viability assessments concluded that they were being used to reduce developers planning obligations.

Gavron told BD: “We really think that some developers are gaming the system and getting away with it. Not all of them but certainly some of them.”

The committee report, which has been sent to Johnson, stated: “There is currently a lack of clarity on how to value land which can trump the provision of affordable housing and cause an unnecessary lengthening of the planning process.

“This lack of clarity means that developers are able to pay too much for land, leading to the loss of planning obligations”

Under current planning guidance, negotiations between developers and planning authorities are confidential and viability assessments rarely released to the public. A developer has the right to negotiate a lower level of affordable homes on a scheme if it can prove that fulfilling local councils affordable housing targets would render the project non viable.

The committee report drew particular attention to the issues at three developments in London, including Greenwich Peninsula, the Shell Centre and the Heygate Estate.

The letter said: “The confidentiality of many viability assessments means that we don’t have evidence of the extent of this problem. However, it is known that many developers negotiate lower levels of affordable housing provision than are set out in the original plan targets.

“There are several large developments where this has occurred, such as Greenwich Peninsula, the Shell Centre development and the Heygate Estate regeneration.”

Islington is the only council in London which currently publishes its viability assessments, although Southwark and Greenwich are considering the same options.

Gavron added: “What we want is ideally a much more holistic approach to viability which looks at the objectives of the public interest and policy objectives such as zero carbon homes, it’s not all about affordability.”

The plan was given a cautious welcome by head of housing research at Levitt Bernstein, Julia Park, who said: “Viability appraisals could be published along with the other documents that are made public when a planning application is lodged so there’s time to interrogate them before decisions are taken.

“It’s better to tackle the underlying problem though. We’ve allowed affordable housing to be viewed only as a burden, not a social contribution, and slipped into a culture of reductive negotiation and bartering – aided and abetted by the emphasis on viability in the NPPF.

“I suspect even the GLA see their target of 40% affordable housing as a starting point for negotiation and that’s where the trouble starts.  Most architects and developers would prefer to have realistic, non-negotiable targets except in very special cases.”

 

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Readers' comments (2)

  • Viability assessments are a mess. Making them public won't make things any better. Like other investors and businesses, developers do what they do according to each site and their own business models. They are simply an invitation to highly competitive people to do the best they can out of a system which encourages competitive behaviour. And why should a competing business give away its business secrets? They won't do that in any case because they know it will be a negotiation. May the best-prepared party win. Better to remove the uncertainty and replace this system of measuring tax with one that is more readily achievable and certain. Affordable housing tax is ideologically sound but has destroyed the delivery of supply of housing. It should be scrapped if we want to increase supply and replaced with a much simpler tariff. Which is what I thought, and the whole industry thought, the Community Infrastructure Levy was designed precisely to do. And if we want housing that is subsidised, then we should subsidise it, not tax it out of existence.

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  • AND there is nothing that is inherently more 'dodgy' about development than any other activity - like politics, banking and journalism, for example.

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