Developers and affordable housing, can Brent learn from Islington?

The issue of regeneration and development in London caused much controversey in London last year as property prices and rents soared and much new development was bought up by overseas investors.  In Brent the Willesden Green Library development was a prime example as the development was sold on twice and the price of a one bedroomed flat rose to £450,000. In Barnet West Hendon social housing tenants are being moved out to make for high rise luxury developments on the bank of the Welsh Harp.

In a widely quoted Guardian article LINK Oliver Wainwright wrote:

Across the country – and especially in superheated London, where stratospheric land values beget accordingly bloated developments – authorities are allowing planning policies to be continually flouted, affordable housing quotas to be waived, height limits breached, the interests of residents endlessly trampled. Places are becoming ever meaner and more divided, as public assets are relentlessly sold off, entire council estates flattened to make room for silos of luxury safe-deposit boxes in the sky. We are replacing homes with investment units, to be sold overseas and never inhabited, substituting community for vacancy. The more we build, the more our cities are emptied, producing dead swathes of zombie town where the lights might never even be switched on.

Islington Council moved to fine 'buy-to-leave' investors up to £60,000 for leaving house units empty LINK and decided LINK to clamp down on developers making 'artifically pessemistic' assessments of the viability of affordable housing schemes:

The council last week launched a consultation on supplementary planning guidance that would require all viability studies to be supported by ‘robust evidence’. This will include details of arrangements between landowners and developers, and information provided by the developer to banks.

Viability studies are commissioned by developers to assess how much affordable housing a scheme could provide while remaining financially viable.

Islington said it has received a ‘significant number’ of viability studies that do not provide underlying methodology and modelling.

These studies are ‘unsupported by robust evidence’ and create ‘an artificially pessimistic outcome’, leading to what the council calls ‘super-profit’.

The council proposes that viability studies that lack ‘all relevant information required’ to have a reduced weight in terms of decision making.

Speaking at a Communities and Local Government committee meeting on 10 September, James Murray, executive member for housing and development at Islington, said: ‘The modelling is often not shared with the council, so we have to try to extrapolate from that. We need national action.

London Councils, the body that represents local authorities in London, said it is ‘aware of concerns from a number of councils’ about viability studies and transparency.

Richard Lemon, associate director of planning at property consultancy CBRE, said: ‘One can be as transparent as you like, but you need skills in-house to be able to properly scrutinise viability.’

In October Isling Council took steps to ensure that there was hoising at social rents at the soon to be developed Clerkenwell Firer Station which had been closed by Boris Johnson. LINK

Another issue is around Section 106 and the Community Infrastructure Levy, 'planning gain' monies paid by developers to Councils to provide infrastructure for projects.  The regulations for CIL in Brent can be found HERE and there is a process by which developers can claim exceptional relief.

In 2013 Quintain, developer of the area around Wembey Stadium, last year challenged Brent Council over Section 106 obligations LINK

WEM36 and WEM38 set out requirements that major new development provides new open space and food growing facilities. Such exceptional provision, which also includes the provision of play space in WEM40 and wildlife enhancements inWEM41, will have an impact on viability and thus will have an impact on Section 106 obligations, after CIL.

I said in that article report that Quintain seemed to want to build dense and build high. It appears from the recent application to build high rise flats on land behind the Civic Centre  LINK that Quintain has overcome Brent Council's earlier reluctance to approve high density, high rise housing units in the area due to their concerns about open space, loss of light and concealing views of the stadium.

Open space, play space and food growing areas do not seem to be priorities at present.

Blocks up to 20 storeys high are planned for the Quintain site

Last year's Localis Report on local authorities and development was reported by Public Finance  said that they were now acting more like developers themselves:

Councils across England will redevelop £13.5bn worth of land and assets over the next five years as part of local plans to turn underused land into a source of revenue, an examination by Localis has found.

A survey of local authorities by the think-tank found many were reacting to ongoing austerity by acting more like property developers.

Instead of deciding to sell buildings and land for one-off capital receipts, authorities were looking to redevelop assets to derive revenue income from them that they can use to help support public services.

To help further develop this process, today’s Public Land, Public Good report called for councils to come together to establish a ‘hit squad’ of highly experienced council officers who could provide advice on maximising returns on council assets. The report suggested that if they could deliver a 5% increase on the £13.5bn assets, this would produce almost £700m of extra revenue.

Certainly the Corporate Risk Register being considered by the Audit Committee this week makes no bones about Brent Council's role. Addressing the risk of lack of external investment in the borough the risk reduction strategy is:

De-risking  by assisting with planning permissions etc. on behalf of developers; Maintaining dialogue with investors / developers. Reviewing other sources of capital finance.

This reflects what Andy Donald, head of Brent Regeneration and Growth, said at a MIPIM Round Table discussion back in April 2010:

What I’ve learned is, when times are good, the big scale projects work well, but when times are not so good, it is best to try and present projects to politicians in a more chunked-up way, where they can generate momentum. Once things have started and momentum builds up it is really difficult to stop it, for funders to walk away. So as local authorities we try and take more responsibility to get things started, which might mean acting as a developer, to take things through planning ourselves, which builds confidence

The Regeneration and Growth department covers both development and planning and I have discussed before whether there is a conflict in these two roles. Planning Officers write reports for the statutorily independent  planning committee on developments that their department have helped instigate.  The experience in Brent seems to be that this approach of smoothing the way for developers leaves out the local community. The default position is in favour of development and a close relationshiop with developers. The public become an irritant when the public oppose developments which change the nature of the neighbourhood or seem aimed at overseas investors rather than local people in need of affordable housing.  The Willesden Green Library development, advertised overseas as having the unique selling point of no affordable or key worker housing on site is a case in point.

That irritation is evident in another section of the Regeneration and Growth section of the Corporate Risk Register when this risk is recorded.

Political pressure from local community/ groups affect abiility to deliver the  new Willesden Green Cultural Centre to budget and time.

That pressure, I presume, is about the new Cultural Centre fulfilling the promises made as a result of consultation and the 'gain' embodied in it for the local community at the cost of a development that has no affordable housing and removes a public open space. 

I think the question that should be asked is whether being 'hand in glove' with developers is preventing  Brent Council from adopting the much more robust approach we see in Labour Islington? Certainly Scrutiny Committee needs to examine the 'deal' that it is getting from Brent's approach as far as 'planning gain' and returns on council assets are concerned.

Dave Hill has written more fully on  Islington's approach HERE

Will privatisation of Brent Council's Library Management damage the service?

There are so many proposals to cut and out-source services under consideration by Brent Council that it is all too easy to miss some important issues.

Labour Brent Council has closed six of the borough's 12 libraries. Now, as well as proposing to cut the amount spent on library stock the Council is also considering out-sourcing the management of the library service as a way of saving on rates. This is the proposal (ENS18) in the documentation that went to Cabinet last month LINK

To change the management of the library service to a trust arrangement. The exact arrangement will need to be determined. Within London, five authorities deliver their services in conjunction with other authorities, one delivers through a charitable trust established by the Council which also delivers other services such as leisure centres and seven have outsourced delivery to a social enterprise or a private sector provider. Elsewhere in the country, some library services have been outsourced to a staff-managed mutual or social enterprise, and larger library services have been commissioned to run smaller ones.  Charitable organisations are eligible for an 80% rebate on NNDR. Changes to rules on business rates in 2013 mean that 70% of the cost of this rebate is borne by Central Government with the remainder being covered by the local authority. Therefore the saving to the Council on business rates of transferring a library service to the charitable sector is 56% of the total rates bill - in Brent this amounts to a saving of approximately £160K. The exact level of savings would depend on the tenders received.

It will take approximately 12 months to complete this work and switch to a new management arrangement.

How would this affect users of this service?

• There would have to be public consultation and a full impact assessment before proceeding.

• There would be no direct impact on service users as there will be no reduction or significant change in service levels or quality.

The  last bullet point is likely to be challenged during the consultation. On his blog  LINK Public Libraries campaigner and member of Voices for the Library, Alan Wylie, explored the issue:

Only a year after being awarded the accolade of the 2017 'City of Culture' Hull City Council are proposing to set up a "leisure company" to take over the running of their leisure facilities, libraries, museums, park ranger and catering services. Now one thing strikes me straight away about this; why are libraries part of the bundle, after all they are statutory and they aren't in my opinion solely a leisure service? 

The answer to the above question probably lies in the fact that most councils place their library services in 'Culure & Leisure' directorates, that someone including the LGA has been perpetrating the myth that libraries are non-statutory, that we have a government and a Secretary of State who fail to intervene to stop library cuts and closures and that we have a chasm in the leadership and promotion of the national service. Libraries have become easy to offload.
So what is a 'leisure company' or 'leisure trust' and what are some of the issues with this model of privatisation?

"What a Leisure Trust means in practice:

• Leisure services are outsourced to a separate organisation/company. 
• The Council retains ownership of the facilities, which are leased to the Trust.
• Virtually all the savings come from rate reductions and VAT savings, which are much smaller initially because of the high set up costs. 
• Direct democratic control of the service will cease - elected member representation on a trust is limited to less than 20% of the board.
• Company law requires that Board members must put the interests of the leisure trust before those of the local authority. 
• After a year the Trust will usually cease to use council services and will be responsible its own procurement and contracting or corporate and other services."

LINK

Unison Scotland have also raised concerns;

"UNISON is concerned that large sections of public service delivery are being shifted off to arms length bodies with very little research into the effectiveness of such change."

LINK

Recently in Renfrewshire there have been protests against plans to pass the running of similar services to Renfrewshire Leisure Limited (RLL).

LINK

And there are similar plans being proposed by Angus Council and Unison have yet again raised concerns; LINK

 “Unison is not convinced that farming out leisure facilities to arm’s-length trusts improves the service for the public or the staff.

“They are not an alternative means of community ownership of public assets. In fact the policy tends to be used to save local authorities tax.

 
“Our experience so far is some trusts perform satisfactorily after the initial separation but the promised savings, extra funding and other benefits tend not to materialise. 
 
“There is no evidence the public see an improvement in the service nor will the trust see a higher rate of private donations, which are often the reasons put forward.”
 
For more on leisure trusts see LINK

I hope that the Scrutiny Committee and Unison will look at some of these issues in detail and make representations before the Council adopts a move that has the disadvantages outlined above.

Planning Officers recommend consent for Welsh School in King Edward VII Park

London Welsh School children at their Stonebridge site last year

Brent Planning Officers' report to be presented to the Planning Committee on January 13th  recommends that consent be granted for change of use of the Bowling Green Pavilion in King Edward VII Park as a school, construction of an additional one storey classroom and a land swap with the lawned area adjacent to Collins Lodge.

The report can be seen HERE

Earlier coverage on Wembley Matters is HERE

It goes to Planning Committee on January 13th (Civic Centre 7pm) and the committee will make a site visit at about 9.35am on Saturday January 10th. You can ask to speak on the application (2 minutes)  at the committee meeting by contacting : 

Joe Kwateng, Democratic Services Officer  020 8937 1354, Email: joe.kwateng@brent.gov.uk 

Wembley Central ward councillor Sam Stopp  is speaking on the issue at Planning Committee and is asking for residents' views. Contact cllr.sam.stopp@brent.gov.uk

Scrutinising Brent's devastating budget cuts

As regular readers will know there was concern when Brent Council changed its Scrutiny structure after the 2014 local elections so that there was just one Scrutiny Committee. In the face of criticism it was argued that the Committee would set up task groups to do more detailed work.

On Tuesday the Budget Scrutiny Task Group will present its Interim Feedback on the 2015-17 budget proposals.

I leave you to decide whether this report measures up to the task of robustly and independently  scrutinising a budget that will have a drastic impact on services and thus on local residents, especially the most vulnerable.