Now Lambeth Labour forced to ditch its failed housing venture

Our housing correspondent, BARRATT HOLMES, on the latest embarrassing climbdown by a south London council

Millions wasted: award-winning Cressingham Gardens, where decent council homes were vacated to make way for profit-hungry private developers

Lambeth Council is to wind up its arms-length housebuilding company Homes for Lambeth after an official review described its performance as “very poor” and recommended a “fundamental reset to the council’s approach” to its regeneration schemes.

HfL was a flagship endeavour established in 2017 with a business model similar in many respects to Croydon’s Brick by Brick, the failed company which did much to bankrupt the borough without ever delivering the volume of social housing for which there is such demand.

The publication yesterday of the Kerslake Review into HfL prompted residents from the council estates blighted by the redevelopment plans to condemn Lambeth Labour, saying that they were “deeply angry” that their warnings had been ignored, resulting in “many millions of pounds of tax-payers’ money wasted”.

Other Labour-run local authorities around the capital, including Newham and Merton, have also run into difficulties with their attempts to move into the housing development market. All created private companies that were variations on Croydon’s efforts to get around Right to Buy legislation that denuded their social housing stock.

Homes for Lambeth was set up in 2017, supposedly to “accelerate” housing delivery. It received £30million from the council. However, it has only begun construction of 65 homes, according to the review conducted by Lord Bob Kerslake, the chair of housing association Peabody and former head of the Civil Service.

Critical: Lord Bob Kerslake, the review’s author

HfL was also allocated £55million funding by the Greater London Authority five years ago to construct 912 homes. The GLA has effectively withdrawn 95per cent of this grant money, while Homes for Lambeth has until March to claim the last £2.75million by starting work on 87 homes.

In his 130-page review, Kerslake recommended that Homes for Lambeth be “consolidated within the council” after a handover period, adding that the borough needed to “take a fresh approach” to its estate renewal programme in the future.

Kerslake notes what appears to have been a complete breakdown in the relationship between council staff and HfL. “We heard of a significant relationship breakdown between some HfL and LBL staff in the past, with interactions described to us by some staff as mutually hostile.”

Significantly, the Kerslake Review was commissioned after the departure from Brixton Town Hall of Matthew Bennett, the council cabinet member who was in charge of housing and regeneration. Bennett was a protégé and parliamentary aide to Steve Reed OBE, the Blairite MP for Croydon North. Reed was the leader of Lambeth Council until 2012.

Bennett’s “ego wouldn’t accept the fact that HfL has been a complete failure”, another hyperlocal news site, Brixton Buzz, reported.

‘Complete failure’: Matthew Bennett, the Labour councillor behind HfL

The Kerslake Review is complete vindication for thousands of council tenants living on estates such as Central Hill and Cressingham Gardens who campaigned against demolition for 10 years.

Kerslake recommends a complete re-set of how Lambeth treats its residents. The review’s findings came after Kerslake went to meet residents on the estates earmarked for regeneration. He described their feelings towards Lambeth and HfL as “uniformly negative”.

The review states: “They spoke of inconsistent approaches, poor communications, delays, lack of consideration and confusion of responsibilities between HfL and Lambeth Council. As a consequence, levels of trust in the council are exceptionally low.”

And it adds, “We acknowledge the frustrations and deep pain that many residents have felt during the renewal programme… The council should also acknowledge the significant shortcomings of its approach to engaging with residents across the estates in the past, in recognition of a number of residents that we spoke to who reported to us physical and mental health impacts that they felt aspects of the council’s engagement has had on residents.”

Anyone who has trawled through the reports on Croydon Council’s treatment of its tenants living in Regina Road, and elsewhere, will recognise much of the sentiment reflected in the Kerswell Review.

Vindication: council tenants have been opposing Lambeth’s estate plans since 2012

It recommends that “the council places the needs and interests of residents at the heart of any future housing strategy, including by setting principles or commitments that relate to community consultation and ballots for estate renewal”.

Lambeth’s council tenants have been calling for estate renewal ballots – as provided for under Labour policy when Jeremy Corbyn was party leader – but were stubbornly ignored by Bennett and his colleagues at Brixton Town Hall.

“There is undoubtedly a risk that, if not handled well, the changes will have a short-term impact on delivery,” Kerslake said. “However, risk of non-delivery is much greater if things continue as they are. Change is needed.”

Lambeth Council officials, in their own report, have said that Kerslake’s recommendations should be followed. A final decision will be made by the council’s cabinet next Monday, December 5.

If the recommendations are approved, Lambeth would be the third south London borough to wind up its housing building arm in two years, following Merton and Croydon.

Kerslake said the next phases of regeneration of Knight’s Walk Estate, Westbury Estate and South Lambeth Estate should go ahead “as soon as practicable”. But he recommended a “fundamental reset to the council’s approach” for redeveloping the Fenwick, Central Hill and Cressingham Gardens estates. “None have clear, agreed and funded ways forward,” he wrote.

Proposals to demolish Central Hill Estate in Upper Norwood were first laid out by Lambeth’s  “co-operative council” in 2012.

Investigation call: Green councillor Nicole Griffiths

Today, Lambeth Council’s opposition Green Party councillors demanded an independent investigation into HfL.

The Green Party is also calling on the council to fill the empty homes on regeneration estates with families, and provide those in temporary accommodation on the demolition estates with secure tenures if they want them.

“We have been calling for a halt to schemes that destroy people’s homes and communities,” said Green councillor Nicole Griffiths.

“There are more than 3,000 families in temporary accommodation, at huge emotional cost to those involved and financial cost to the council’s budget.

“We have been calling for a housing strategy that would deliver council homes at council rent with secure tenancies. The council needs to listen to residents and do everything in its power to deliver the homes our families need and want urgently.”

And Pete Elliott, a housing activist and Central Hill resident, said, “We are deeply angry that the council refused to listen to warnings from Green Party councillors and residents which has resulted in many millions of pounds of tax-payers’ money wasted.”

Read more: #PennReport: Cover-ups and denial over Brick by Brick failure
Read more: Council knew housing scheme was ‘unviable’ four years ago
Read more: Brick by Brick abandons its planning consents and 23 sites

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11 Responses to Now Lambeth Labour forced to ditch its failed housing venture

  1. Local authorities have no idea about business – never have. They were given new powers to go into business some years ago and it’s been a disaster – the mind-set is so different. These failed housing ventures you mention are a tragedy for us all, yet we see no shame or contrition from the puffed up wannabee developers who have failed us so badly. And local people who need homes have been failed most of all.

    • Chris Flynn says:

      I don’t disagree. But is the reason for councils having to come up with these money-making schemes a failure of central Government to adequately fund councils?

      • David Squires says:

        If you were to ask people which Government/council departments aren’t underfunded you’d get a blank stare, yet we have the highest tax burden since WWII. Put simply, it is gross inefficiency, low quality staff and bad decisions. The never ending tree of money will achieve nothing.

        • Nick Davies says:

          “gross inefficiency, low quality staff” ?

          Perhaps you could advise where you will find all the brilliant, hard-working people to replace our grossly inefficent, low-quality teachers, doctors, nurses, firefighters, paramedics, armed forces, police..?

  2. And then there is an article in The Grauniad “Thurrock council admits disastrous investments caused £500m deficit” What makes so many of these amateurs think that they can play the property market with the professionals?

    • Because that’s what the Tories in government have encouraged them to do, rather than provide proper funding for local services.

      Mayor Perry’s pre-emptive S114 last week effectively admitted as much.

  3. Sarah Gills says:

    It’s worth digging around to see who/which consultants/companies sold local authorities these ideas of housing companies. Plenty of these snake oil salesmen ready to sell their “solutions” to uninformed, inexperienced local authority staff.

    • In Croydon it was driven largely by (checks notes) the self-acclaimed “regeneration practitioner” Jo Negrini. Hon FRIBA. Who had worked previously at Newham. And Lambeth…

  4. Jim Bush says:

    Is it any consolation now that Croydon is not the only basket-case council, with Lambeth and Thurrock (just outside London, in bandit country) also in trouble ?!

  5. Fred Wilson says:

    There is something very wrong with Lambeth Council.

    Look at all that has been written about Shirley Oaks.

    They are a disgrace.

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