Many pressures on Brent housing put projects at risk

 A Quarter 2 financial report LINK going to Cabinet on Monday covers a range of areas where inflation and the cost of living and energy crises have impacted on the Council’s budget. Of particular interest is the impact on housing, both the Housing Revenue Account (HRA- council housing) and the capital programme (building of new homes). [My emphasis throughout]

There is a double whammy of homelessness increasing and the affordable private rental sector reducing:

3.6.7  As the cost of living crisis deepens, with energy costs and day-to-day expenditure increasing steeply, there has been a rise in homelessness applications, resulting in an increased use of temporary accommodation (TA).

3.6.8  In addition, the affordable Private Rented Sector (PRS) has contracted, which means there is a lack of supply to move households on from TA, which will put further pressures on the budget. Although, the recent opening of Anansi and Knowles house has alleviated this pressure to some extent, both schemes are now full and silted up due to the lack of move on accommodation available.

The cost-of-living crisis is expected to increase the number of families in rent arrears while the financial impact on the HRA budget could mean an increase in rent and reduced services:

3.6.9  The current economic climate could also have an impact on the rent collection rates and result in increases in rent arrears. Collection rates are being closely monitored and there are ongoing investigations to better understand the drivers for the movements.

3.9.2  The HRA is forecasting a break-even position for 2022/23. This is the net result of overspends on voids and a backlog of repairs being offset by underspends due to staffing vacancies and a reduction of the capital programme. There are also a number of other risks and uncertainties in this fund that could pose financial pressures.

3.9.3  High levels of uncertainty around the inflation and rising interest rates pose a financial risk to the HRA. This has an impact on the cost of materials and repairs, as well as the cost of new build contracts. Rising energy costs are to be passed on to tenants and leaseholders resulting in an increased risk of non- collection. In addition, rising cost of living is likely to impact rent collection rates and consequently result in increased rent arrears. Other pressures involve the capital programme as there is no new government funding having been made available to meet environmental priorities and requirements such as carbon reduction works to homes.

3.9.4  The increased costs experienced by the HRA would have to be met by rent inflation and modifying service delivery. The rents policy is currently under consultation and it is unclear at this stage what restrictions the Council will face.

The delivery of new homes is in jeopardy due to inflationary pressures and the report anticipates further changes in tenure of the kind already reported on Wembley Matters at Watling Gardens where the amount of genuinely affordable housing at social rents is reduced to ensure viability of the project. This could mean the proportion of private housing and controversial shared ownership being increased and London Affordable Rent becoming the norm  and some projects being abandoned or postponed:

Capital Programme

4.1  Rising inflation, a continued shortage of labour and materials and events such as the COVID-19 pandemic and the war in Ukraine have had an adverse effect on costs and therefore the financial viability of schemes. The Government reported an increase of 23% in the costs of materials such as steel, timber and concrete last year alone.

4.2  For those projects in contract and being delivered, the Council is already receiving requests from contractors to re-negotiate pricing due to the cost of raw materials of which the Council are exploring all options to sustain viability including value engineering and tenure mix to allow schemes to continue. This is also impacting viability for schemes that are not yet in contract but within the Capital Programme and those in the forward plan pipeline. Even with the mitigating measures, it is likely there will be schemes that are cancelled, paused or reduced in scope to ensure funding can be prioritised appropriately.

4.3  The Council is in the process of reassessing the viability of our Housing Capital Programme in light of recent inflation figures. The exercise will model the potential impact of expected cost increases for schemes not yet in contract or received a recent tender price. In anticipation of the adverse affect on the scheme’s viability, the Council will assess the scope of the scheme whilst also reviewing the impact of cross subsidy.

4.4  The impacts of inflation are not reflected to the full extent in the budget variances reported as above due to:

·  The variances analysed in this report are for the financial year 2022/23 only;

·  Some impacted projects have had additional budgets secured by Cabinet for example Watling Gardens which now includes 23 shared ownership homes which protected the Council’s ability to deliver 45 Extra Care homes and 56 homes at London affordable rent;

·  Many projects have the initial phases of the budget approved which is forecast above, however the further build phases of the scheme are yet to have been approved.

A further pressure is over-spend on Housing General Fund project.

4.6  Housing General Fund

The General Fund Housing Programme is projecting a variance of £2.8m (overspend of £3.3m and slippage of £0.5m). An overspend of £2.5m is forecast on the Learie Constantine Centre as a result of amendments to the cost plan and contract arising from changes in building safety regulations. A £0.4m overspend is forecast for Empty Property Works Programme based on the project team’s assessment of the need. There is an £0.2m overspend forecast on Church End development due to the need to redesign RIBA Stage 3 to comply with the new Building Safety Act. There is a £0.2m overspend forecast on Peel Road to account for the contractor’s claims which they have assigned to variations instructed by the Council. There is a slippage of £0.1m on Clock Cottage and £0.4m on Nail Acquisition & Refurbishment resulting from the ongoing assessment of scheme progress and spend timing estimates.

 

4.9 St Raphael’s

The two St Raphael’s schemes, Estate Regeneration and Phase 1 of the Infill Development, are forecast to spend to budget for the professional fees and works to support the planning applications associated with the scheme of £1.4m and £0.5m respectively.

Risk and Uncertainties

For the Infill housing development, the project team are working on the planning application for Phase 1 as per the Masterplan. The viability of the development is under regular review and work is ongoing to understand the implications of the current market environment for delivery on the site.

 

A further risk not covered by the report is that slippage of some schemes will mean that Brent Council is not complying with the timetable demanded by the GLA as a condition of their grants and the funding could be lost:

 

 

 

 

Brent’s Affordable Council Housing – the promises and the reality

Guest post by Philip Grant in a personal capacity.

This image is a screenshot from a video featuring Cllr. Promise Knight, Brent’s Cabinet Lead Member for Housing, Homelessness and Renters’ Security, which was produced by a PR company to promote the Council’s “infill” housing scheme for Clement Close. The video was shared in Martin’s blog about residents’ opposition to Brent’s plans, in July 2022.

 

My use of images from that video in this guest post is not intended as a personal attack on Cllr. Knight. Her words in the video are official Brent Council housing policy, which she may have been reading from an autocue, and I don’t doubt that she believes them to be true.

 

I’m writing this blog as a follow-up to one last month, “Scrutiny – What Scrutiny?”, after my expectation that concerns over Brent’s Cecil Avenue housing scheme (raised in a deputation on 9 March 2022) would be considered at the Resources and Public Realm Scrutiny Committee meeting on 6 September were dashed in a single sentence from the Chair, Cllr. Rita Conneely:

 

‘I’ve received information which reassures us about the accuracy and the quality of the information that was presented to the Scrutiny Committee.’

 

The only information I was aware of which had been presented to the Committee was a written response, sent from a Council Officer two months after my deputation, which made no reference to the Cecil Avenue housing scheme part of it. Cllr. Conneely’s sentence referred to two lots of ‘information’, so I submitted a Freedom of Information Act request for both of those, and have now received two documents in response to it.

 

I will ask Martin to attach these. The first includes the “Housing” section of the original “Poverty Commission Update” report, my deputation and the Council’s response to it, and then refers to information about the Cecil Avenue scheme which the Council had sent to me, and had not previously provided to the Committee. There is no indication of when this was supplied to them, and whether this was to all members, or just to the Chair.

 

  

Information reassuring the Committee that Brent had provide information to me!

 

After that brief “note”, it sets out the text of an email which Cllr. Promise Knight sent to me on 13 July 2022. I must apologise to Cllr. Knight, and to “Wembley Matters” readers, as I’d said I would share her reply with you. I thought I had done, but I’ve now found my “possible guest blog” document, unfinished and never submitted to Martin! Here is what she wrote:

 

‘Thank you for your email regarding the proposed development of the Cecil Avenue site. It is my understanding that you asked similar questions at Full Council of November 2021 and received a written response.

 

In summary, the Cabinet report of August 2021 that considered proposed developments in Wembley Housing Zone set out the position. 

 

Brent Council signed funding agreements with the GLA in 2016 and 2018, securing £8m grant to deliver 215 affordable homes across six sites within the WHZ by 2025, through a rolling programme of acquisition and development, and used £4.8m grant to acquire Ujima House. 

 

Heads of terms were subsequently agreed with the GLA to amend the existing WHZ funding agreement to refocus the £8m grant to deliver 152 affordable homes solely on the two council-owned Cecil Avenue and Ujima House sites. 50% affordable housing is proposed across the two sites, with London Affordable Rent homes, increasing the amount and affordability of affordable housing above minimum levels secured at planning. The development will also include workspace to support job creation and economic growth, community space, highway and public realm improvements and new publicly accessible open space. Reviewing the WHZ financial viability, the GLA also agreed in principle an additional £5.5m grant to deliver the scheme.

 

The council can also use its own capital, secured via ‘prudential borrowing’ in order to deliver additional affordable housing. Each opportunity to deliver housing is considered on its individual merits via development appraisals that assess a number of variables per site that ultimately evaluate viability. The intention of the council is to maximise the availability of affordable housing across the borough while ensuring that the proposals represent good value for the council and that borrowing is sustainable. The Council needs to ensure the entire programme is financially viable within the GLA grant available hence the requirement for a mixed tenure development in order to subsidise the delivery of the affordable elements.’

 

Although Cllr. Knight’s email gave more financial details than had previously been supplied to me, it does contain errors. The 50% affordable housing (which is what private developers are meant to provide) is not proposed to be all at London Affordable Rent. Sixty-one of the 98 “affordable” homes the Council intends to retain at Cecil Avenue (after transferring 152 other homes to a developer, for private sale) are to be for shared ownership or “Intermediate Rent”.

 

And my 9 March deputation to R&PR Scrutiny Committee (and follow-up emails to the Chair) urged the Committee to challenge the viability (they could get the details of this, while I’m not allowed to see them because of “confidentiality”), and to question Cabinet Members and Senior Officers as to why they cannot provide more genuinely affordable homes on the former Copland School site.

 

 

I’ll go back to what Cllr. Knight said in her Clement Close video, using images from it (with several lines of text edited into a single picture, for ease of reading). One of the main arguments used by the Council for why it needs to build so many new homes is:-

 

 

They make much of their “Brent Labour” promise of 1,000 new Council homes by 2024 (although a September 2021 “Life in Kilburn” blog showed that many of these would not be for households in temporary accommodation, or on the Council’s housing waiting list):-

 

 

And now the key point, used to justify the many “infill” schemes on existing Council estates:-

 

 

The former Copland School site at Cecil Avenue is a large piece of vacant Brent Council-owned, brownfield land in Wembley. The Council has had planning permission to build 250 homes there since February 2021. What an opportunity to make the most of that, and deliver a quarter of the entire 1,000 new Council homes target, in just one project! 

 

Work could already be underway (they currently don’t expect to “start on site” until next year) to deliver those homes, yet the Cabinet and Council Officers seem fixated on pushing through lots of smaller “infill” projects, against the wishes of many existing residents.

 

The second document which the Chair of R&PR Scrutiny Committee had received, headed ‘Mr Grant Clarification’, is unsigned and undated. It sets out ‘the current position’, and there has been a significant change from the written response sent to me last May. My deputation pointed out that the Report on progress in meeting the Poverty Commission recommendations (which Cabinet had accepted in September 2020) made no mention of social rented homes.

 

The Brent Poverty Commission recommendation for ‘more social rented homes’.

 

In May I was told:

 

‘In 2021, following discussions with the GLA the council received £111m of GLA grant, this falls within the 2021 – 2028 programme and will allow the council to build 701 Social rented homes, which are currently in development and feasibility stages. Delivering social rented homes remains a major priority of the council.’

 

This is in line with what both Brent and the GLA were saying last year:

 

 

The “Clarification” document now says:

 

‘The Poverty Commission report stated that the council is on track to deliver more than 1000 council homes by 2024 and a further 701 council homes by 2028. These are intended to be provided at London Affordable Rent levels.’

 

Although both Social Rent and London Affordable Rent (“LAR”) are classed as “genuinely affordable”, they are different, as I pointed out in a guest post in July. Even if Brent Council were to charge the maximum “rent capped” amount for Social Rent (which it does not have to), this is still cheaper than LAR. My ongoing dispute with the Council over the rents for two new Council homes at Rokesby Place, which were wrongly changed from Social Rent to LAR (by Planning Officers!), showed that the tenant of each four-bedroom home would have to pay £772.20 a year more (on 2022/23 figures) if the tenure was LAR.

 

The second document also suggests that Brent is likely to include more ‘intermediate housing (for example shared ownership)’ as part of the so-called “affordable” housing that it builds. It is already going down that road, both at Watling Gardens, where Cabinet approved a change of 24 homes from LAR to shared ownership in June, and in its Cecil Avenue proposals.

 

A placard from a demonstration against Shared Ownership.

 

But the Advertising Standards Authority has recently ruled that shared ownership cannot be described as “part rent, part buy”. Legally it is just an “assured tenancy”, which has been dressed-up as home ownership for political purposes. The rent rises each year are not “capped” (as Social Rent and LAR levels are). If the “owner” of a “share” defaults on their rent (or service charges) their home could be repossessed, and they would lose all the money they have paid for their “share” of the property.

 

And, shared ownership is NOT affordable to most Brent households living in temporary accommodation, or on the Council’s housing waiting list!

 

The direction that Brent Council is travelling over its provision of New Council Homes is moving away from what the 2020 Brent Poverty Commission Report showed was needed. It found:

 

‘More than 90% of couples or lone parents with two children cannot afford LB Brent social rents, and no family with two children (whether couple or lone parent) can afford any rent that is more expensive than LB Brent social rents.’

 

If that is true, then why is Brent not building affordable homes for Social Rent?

 

Philip Grant.

 

Rokesby Place – Brent tries to justify its planning malpractice

 Guest blog by Philip Grant, in a personal capacity.

 

Architect’s drawing of the two infill houses for the Rokesby Place car park.

 

I will try not to make this guest post too long, as I will ask Martin to attach two long letters at the end of it. But I hope that as many “Wembley Matters” readers as possible will take the trouble to read this, and the letters. This is a follow-up to my article earlier this month, which included my letter of complaint to Brent’s Chief Executive over alleged planning malpractice.

 

The letters are about the level of rent which the future tenants of two “affordable” New Council Homes on an infill scheme at Rokesby Place will have to pay. More importantly, though, they deal with the way in which Brent’s Planning Officers went against the rules meant to ensure that the Council’s own planning applications are dealt with impartially and transparently – and how they have tried to justify the actions they took.

 

Extract from the Rokesby Place planning application, 22/1400.

 

The planning application for Brent’s Rokesby Place “infill” housing scheme was made in April 2022, and was quite clear that the two houses would be for Social Rent. But when the Officer Report was prepared on the application, for the Planning Committee meeting in August, no mention was made of Social Rent, and the “affordable housing” condition in the draft consent letter said that the homes must ‘be delivered as London Affordable Rent units’. 

 

There was nothing in the published documents to show how or why Social Rent had been changed to the more expensive London Affordable Rent (“LAR”). I had to issue an FoI request to uncover that information. This led to the first part of my 5 September complaint, that there was no reason for, and no justification for, any change from Social Rent to LAR, and Planning Officers had been wrong to change it.

 

I received the reply to my complaint letter from Carolyn Downs on 16 September, but I believe it was probably drafted for her by the top officer(s) in Brent’s Planning Department. This was the reason given for why they recommended LAR, rather than the Social Rent level shown by the application they were asking Planning Committee to approve:

 

Extract from the letter of 16 September from Brent’s Chief Executive.

 

I have set out my response to that in my letter of 22 September below. Briefly, Planning Officers should not be changing what an application says just because they think it should be different, to do so for one of Brent’s own applications (although why, when it’s a Council application, was the Project Manager ‘the applicant’?) was not being impartial, and no ‘clarification’ was needed, because the application was clearly for Social Rent!

 

The action which Planning Officers took raises serious concerns for other Council housing schemes, especially a number of forthcoming “infill” schemes (Newland Court, Kilburn Square, Clement Close, to name just a few): 

 

·      Will they treat other applications for Social Rent housing (as recommended by the Brent Poverty Commission Report, and as supposed to be provided under the GLA’s 2021-26 affordable housing programme) as if they should be for LAR? 

 

·      Will they interfere with other details which have been published in the application documents, and recommend different conditions to Planning Committee, without disclosing that they’ve done so?

 

Even though they had failed the “transparency” requirement in the Local Government Association’s “Probity in Planning” guidance, by not telling Planning Committee that the application was for Social Rent, the Council’s view was that members, when making their decision, ‘were aware that the application was originally for the provision of Social Rented homes.’ I could hardly believe the reason they offered to justify this:

 

Second extract from the letter of 16 September from Brent’s Chief Executive.

 

This was the conclusion which Brent’s Chief Executive came to (on the advice of Senior Planning Officers) in response to my complaint(s):

 

The conclusion from the letter of 16 September.

 

I have not accepted that conclusion, for reasons set out in detail in my letter of 22 September. In case you don’t feel like reading it in full, here are some paragraphs from near the end of it which sum-up my position:

 

‘Planning Officers seem to take the view that as Social Rent and LAR are, on the present figures, ‘very, very similar’, then it does not matter whether the affordable housing provided is one or the other. That would not matter for compliance with policy BH5, but as I pointed out in my letter of 5 September, it would matter for the tenants of the two new homes at Rokesby Place. 

 

As you quoted, from the Brent Local Plan Glossary, these affordable homes will be ‘for those whose needs are not met by the market.’ They will be Brent families in housing need, quite probably on limited incomes. By charging them LAR rent levels, rather than Social Rent, even on present figures, they will have to pay £772.20 a year more. As the annual rent increases for these two types of affordable housing are linked to CPI, by the time the houses are built each tenant will have to find nearer £1,000 a year more if LAR is charged, rather than Social Rent.

 

If a planning application states that the affordable housing tenure will be Social Rent, that complies with policy BH5, and should not be changed without good reason. And if there are reasons for changing from Social Rent to LAR, they need to be set out transparently, both for the Planning Committee and the public. That was not done on this application, so even if Brent Council believes it achieved the “right” answer, the way it was achieved was wrong. So wrong that it needs to be put right.

 

I hope you can now agree that the new Brent Council affordable housing at Rokesby Place must be for Social Rent, as applied for on the Council’s behalf under application 22/1400.’

 

I’m putting this correspondence “in the public domain”, so that anyone interested can read it and make up their own minds. If you agree that something has gone wrong here, please feel free to write to your local councillors about it, with a copy to carolyn.downs@brent.gov.uk .

 

Philip Grant.

 The letters - click bottom right corner for full page version.

EXCLUSIVE: Rokesby Place – Brent's possible planning malpractice exposed

 Guest post by Philip Grant in a personal capacity

Architect’s drawing of the two proposed new Council houses at Rokesby Place.

 

There was a flurry of blogs on “Wembley Matters” last month about the planning application for the proposed Brent Council housing “infill” development at Rokesby Place. On 12 August, Martin wrote about the loss of green space and the tenure change. Straight after the meeting on 17 August, he reported that Planning Committee had “dumped” the a recommendation of the 2020 Brent Poverty Commission Report, and allowed a changed of tenure for the two new homes from Social Rent to London Affordable Rent.

 

I could not understand the justification for Brent’s Planning Officers recommending LAR when the planning application, only 4 months earlier, had said that the houses would be let at Social Rent level. 

 

Extract from the Planning Statement for the Rokesby Place application, 22/1400.

 

I added a comment below the second blog, giving the text of a Freedom of Information Act request I’d sent to Brent’s Head of Planning, seeking the evidence behind that change of tenure. Martin published that as a separate post the following day.

 

I received the information I’d requested on 1 September (that was quick for an FoI, but I’d told the Head of Planning that he should not issue the consent letter until my enquiries were resolved!), I said I would share the response with “Wembley Matters” readers, and will ask Martin to attach it at the end of this article, if possible.

 

I am not attaching the two enclosures, which were series of emails between Brent Planning Officers, the Brent Project Manager for the Rokesby Place scheme and the planning agent representing Brent Council for application 22/1400. The names of senders and recipients had been redacted (in order to protect the guilty?). 

 

I will include copies of the key emails below, as I explain what Council Officers did wrong, and why the change from Social Rent to LAR was not justified, and should be reversed. There is more detail on this in an open letter, and formal complaint about the conduct of the Council Officers involved, which I have sent to Brent’s Chief Executive. I hope that Martin can also attach a copy of that, as it includes some important points which MUST be put right before any more planning applications for Council “infill” housing schemes are considered.

 

Email from Planning Case Officer to Project Manager in Brent Property Services.

 

The email above was sent by the Planning Case Officer (“CO”) to Brent’s Rokesby Place Project Manager (“PM”) when the Officer Report was about to be published with the agenda for the Planning Committee meeting on 17 August. There should not have been any doubt about which rent level should be in the recommended affordable housing condition, as the application clearly stated Social Rent!

 

But worse than that, the CO should not have been communicating with the PM over the application (especially offering the chance to change a detail in it). There have to be special procedures in place where a Council, like Brent, is both the developer and the Local Planning Authority, to ensure that the Council’s applications are dealt with fairly. This is summed up in the Local Government Association booklet, “Probity in Planning”:

 

Extract from “Probity in Planning”, 2019 edition.

 

I have set out why this contact, which could (and did) have an unfair influence on the planning decision, was wrong in my letter to Carolyn Downs, if you are interested in the detailed reasons.

 

Further emails from the CO to the PM over the next few days, after the Officer Report had been published, show that the Planning Officer knew that recommending LAR might be a mistake, and that if it was, that should be reported to Planning Committee members.

 

The “confirmation” CO sought was finally provided by PM later that day, and acknowledged by the Planning Case Officer:

 

But LAR was not correct. It might be what was intended on the New Council Homes ‘master tracker’, but it was not what was shown by the planning application. That was Social Rent, which should have been the tenure included in the Officer Report for Planning Committee.

 

The emails between the planning agent, Maddox & Associates (“M&A”) and CO, and copied to another person (possibly the Senior Planning Officer who would be presenting the application to Planning Committee) are even more worrying. There were no communications involving the tenure of the proposed new homes after the application was submitted until the afternoon of 17 August, just a couple of hours before the Committee meeting. This was the first, from M&A:

 

Email from planning agent to Brent Planning Officer(s), 125 minutes before Committee meets.

 

M&A were concerned. They’ve discovered that “residents” are raising the issue of what rent level should be charged for the proposed new homes (they’d been discussing it on “Wembley Matters” since 12 August!). So M&A claim ‘we have always proposed that the units are 100% London Affordable Rent’. AND, in the final sentence, they effectively ask Planning Officers to repeat that claim, ‘in case Members ask the question to officers directly’ at the meeting!

 

We know that claim was false, because M&A had proposed that the homes would be for Social Rent. But Brent’s CO also knows it was false, because eight minutes after receiving that email from M&A, the CO sends this reply:

 

 

Undeterred by the truth, M&A send a further email to the CO (again cc’d), less than 50 minutes before the start of the Planning Committee meeting which will consider the Rokesby Place application. [The warning that it ‘contains information that may be confidential’ and that the recipient ‘may not … disclose it to anyone else’, does not protect it from a valid FoI request!]:

 

 

M&A are “flagging” to Brent Planning a line of argument which could be used to justify LAR being the tenure required in the affordable housing condition included in the Rokesby Place planning consent letter. I don’t know whether the Senior Planning Officer who presented the application to the meeting that evening saw this email, or was aware of its contents. But I do know, from watching and listening to the webcast, that this was the basis of the argument which she used.

 

I have set out in my open letter to Brent’s Chief Executive, in much greater detail, why the actions of Brent Planning Officers before and at the Planning Committee meeting were wrong and unacceptable. This includes the fact that the objectors (particularly the Ward councillor, Ketan Sheth, over the Social Rent or LAR point) were not dealt with fairly and impartially.

 

I have also set out how I believe my complaint(s) should be resolved, including the measures needed to ensure that future planning applications where Brent Council is the developer (and there is likely to be a string of new “infill” housing applications over the next few years) are dealt with properly, fairly and impartially.

 

I may not achieve everything that I hope for, but I am confident that Brent should reverse the decision over affordable housing tenure, so that the two new homes at Rokesby Place will be for Social Rent, not London Affordable Rent. 

 

The tenants of those four-bedroom houses are likely to be large families in urgent housing need. The Planning Officer claimed that the two rent levels were ‘very, very similar’. But, even on the figures she gave, each tenant would be paying £772.20 a year more than they should be if LAR is charged, rather than Social Rent. That’s why the Social Rent level recommended by the Brent Poverty Commission Report is so important to families on a tight budget.

Philip Grant. 

Information Request and Open Letter to Brent CEO.  Click on bottom right corner for full page view.