Council developer delivering just 8% homes for affordable rent

BARRATT HOLMES unveils startling figures from the council on the failure of its own house-builder to deliver on promises to deliver affordable homes

Alison Butler: only 8% of her Brick by Brick home-building scheme will be for affordable rent

There could be one very strong reason that Paul Scott, the controversial chair of Croydon’s planning committee, failed to insist that Westfield meets the council’s 30 per cent target for affordable homes within its latest planning application last week.

That’s because Scott knows that the council’s own house builder, Brick by Brick, is falling a long way short of the council’s early boasts that it would be delivering 500 affordable homes as it builds 1,000 properties on public land around the borough. In fact, fewer that 8 per cent of all Brick by Brick’s homes will be provided for affordable rent. The rest will be flogged off as private sales or for shared ownership.

According to a council response to a Freedom of Information request, Brick by Brick is down to just 36 per cent of quasi-affordable homes in the projects in which it has been gifted council land and where planning permission has been forced through by Scott’s committee.

Housing is the cabinet responsibility of the deputy leader of the Labour-run council, Alison Butler. Butler is married to Scott.

The very helpful table details the 29 Brick by Brick sites already granted planning permission.

But the council’s table is not so helpful as to provide the totals for each of the columns of homes being built for private sale, for shared ownership or affordable rent.

So we’ve done it for you.

According to the table,

488

homes are to be built for private sale.

208

will be available for shared ownership. And just

60

will be made available for affordable rent.

This is all made possible using publicly owned land and through loans provided by Croydon Council to Brick by Brick, which is run as a private company, paying directors’ fees, but without any real degree of public accountability.

As the council’s FoI response explains, “The 2016 published financial accounts for BxB show that a total of £10.471million has been borrowed from the council so far, for which £72,000 of interest had already been incurred by the end of 2016 (and will continue to be accumulated until the debt is fully repaid).

“The council’s ‘Revolving Investment Fund’ has been set-up for the purpose of investing in development projects such as BxB.  Each funding agreement is subject to a financial appraisal of the scheme to evidence a sound investment case. The council provides both debt and equity financing to BxB at market (and State Aid compliant) rates. This means that the repayment of all loans provided to BxB is subject to interest, which creates an additional revenue stream to the council as it has the ability to borrow at competitive rates to service this lending.”

What it doesn’t appear to be doing is providing very much in the way of truly affordable housing. Sadiq Khan, the Mayor of London, has recently revised the GLA’s definition of “affordable”, acknowledging that 80 per cent of the market rate at London’s sky-high rents or house prices is not really affordable at all.

And Mayor Khan has also raised the bar as far as the amount of affordable housing that should be delivered in new schemes around the capital, to 35 per cent.

It seems unlikely, therefore, that the Mayor of London would be overly impressed with the delivery of affordable homes under Croydon’s Brick by Brick scheme.

It was soon clear from Brick by Brick’s early planning applications that they would struggle to hit the 50-50 target, which Butler had boasted about at the 2016 Labour Party conference. By earlier this year, the amount of affordable housing that Brick by Brick was expected to deliver was down to 43 per cent.

But what the council’s response to the FoI request reveals is that the amount of affordable housing now scheduled is now below 36 per cent.

And of those, less than 8 per cent – 60 homes – are being developed for affordable rent.

In the biggest Brick by Brick development, at College Green in the town centre, next to Fairfield Halls, just 33 of the 218 proposed homes will be for shared ownership – barely 15 per cent.

In comparison, Westfield’s 20 per cent affordable properties in its planning proposal submitted last week begins to look very good.

Since 2014, the Labour-run council has built the grand total of 0 council homes.


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About insidecroydon

News, views and analysis about the people of Croydon, their lives and political times in the diverse and most-populated borough in London. Based in Croydon and edited by Steven Downes. To contact us, please email inside.croydon@btinternet.com
This entry was posted in "Hammersfield", Alison Butler, Brick by Brick, Croydon Council, Housing, Jo Negrini, London-wide issues, Mayor of London, Paul Scott, Sadiq Khan, Whitgift Centre and tagged , , , , , , , . Bookmark the permalink.

One Response to Council developer delivering just 8% homes for affordable rent

  1. I note with interest that none of the schemes for private sales contain a single unaffordable “affordable rent”. They obviously don’t want the riff-raff mixing with the foreign investors and reducing their yields. There are also only six private sale developments out of 19 that even have an element of shared ownership.

    Still, I suppose that is one way of easily avoiding “poor doors”

    The comments about BxB paying commercial interest to the council are also interesting. A wholly owned council company that only employs council staff, borrowing from the council and paying interest to the council. Revolving door investment fund more like.

    Liked by 1 person

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