2019 – New Year’s Resolutions

Jan 14, 2019 12:00 am

Ten things Southwark Council should do in 2019 -To welcome the New Year and in a spirit of fraternity we have come up with ten actions that Southwark Council can consider taking, in order to ease the effects of the housing crisis and create a fairer future for the borough’s residents.

1. Stop selling off Council homes

Research by the London Tenants Federation shows that Southwark has lost more social housing than any other borough since 2001.

As well as right to buy and estate demolitions, homes are also being lost through the sale of ‘high value’ coumcil homes, through a scheme that was introduced in 2009 by Southwark’s Tory/Lib Dem administration, for vacant council houses valued above £400,000 . In 2011 the scheme was reviewed and the value reduced to £300,000 by the incoming Labour administration.

We don’t know how many council homes have been sold under this policy to date, but this compilation taken from an auction website shows a sample of over 50 properties sold off in this ongoing policy of disposals.

Extracts from a sample of council homes sold by the current Labour administration under this policy

Southwark’s justification for this is that the sales revenue allows more council housing to be built more cheaply elsewhere in the borough, but the cost of building new social rented homes is surprisingly high and can exceed the £300,000 threshold:

Extract from Council report on Kipling estate new builds

Extract from Council report on Pelier estate new builds

As we reported previously the Council is still selling off or knocking down Council homes faster than it is building them.

2. Stop selling off public land and buildings

Southwark’s ‘modernisation’ drive has also seen it sell off public buildings and land including both Bermondsey and Peckham Town Halls; Harper Rd Social Services Centre; Castle Day Centre; Whitstable Day Nursery; Abbey St Children’s Home; Willowbrook Community Centre and the Wansey St Homeless Hostel.

Land sold includes a plot near Millwall stadium and Southwark’s former car pound off the Old Kent Road, likewise a plot of land at Devonshire Grove and a plot of land on the Beacon House estate and one at Woods Road in Peckham.

These sales no doubt raise funds, but The Mayor’s new draft London Plan introduces a requirement that 50% of new housing developments on public land should be affordableso whatever immediate gains these sales bring, the imperative should be retaining as much land in public ownership as possible, to take full advantage of this change.

3. No more approvals like this…

If Southwark is serious about fulfilling its manifesto promise to build 11000 council homes there must be no more approvals of developments like Braganza St, on the site of the council’s former enterprise workshops in Kennington and one of 20 sites in Southwark’s Regeneration Partnership Programme (SRRP), its flagship council house delivery programme. Despite the consultation process for this site promising 55% council homes, planning permission was granted last year for 33 new homes, 28 of which private, 5 intermediate and none social rent or council housing.

4. Stop granting planning permission for schemes that don’t comply with planning policy requirements

Our research into major developments approved in Southwark over the past 10 years has shown that out of a total of 11,863 new homes given planning consent, just 456 (3.8%) were social rented tenure. Had Southwark stood firm and forced these schemes to comply with minimum policy requirements then 2,500 social rented homes would have been approved in total.

5. Stop buying S106 homes from developers

We have blogged previously about the council buying affordable housing from developers to help deliver on its failing manifesto pledge. The problem with this method of buying council housing is that it does not actually increase the net supply of social housing – the same units would otherwise have been bought and let by a housing association anyway. Further, Southwark is denying itself the benefit of the S106 contribution, by paying for something a housing association would have paid for – and, rather perversely, denying itself funds for building units that would actually increase the net supply.

6. Start monitoring and enforcing tenure requirements of Section 106 agreements

In May 2015 we discovered that Notting Hill Housing association had provided affordable rent (up to 80% market) as part of its Bermondsey Spa Regeneration scheme. Following this we discovered 43 further schemes where raised a similiar concern. After the Council dismissed our complaint we referred it to the Ombudsman who concluded that the Council “did not have a systematic supervision procedure to check compliance” with the tenure provision requirements of its section 106 agreements. Instead “it relied on developers’ voluntary compliance.” The Ombudsman ordered Southwark to conduct an audit of S106 tenure provision and introduce monitoring/compliance procedures.

The Council initially promised that first 1 year audit would be published in 2017. It didn’t happen. It later explained that the audit was taking time because it was going back to 2010 and promised that it would be completed in Spring 2018. Nearly three years have now passed since the Ombudsman decision and while the chair of the planning committee has promised to look into it, we are yet to see or hear anything of the audit.

7. Make development partnership agreements public

Southwark has made an often repeated committment to transparent viability assessments. This transparency should be extended to all development related documents, including development partnership agreements with private developers. These contain the same categories of information as viability assessments and determine the public benefits a scheme will deliver.

Last October we requested a copy of the Council’s partnership agreement with British Land for the gargantuan Canada Water redevelopment plans (46 acres of Council freehold land, more than 3000 new homes). After two and a half months it was released, in heavily redacted form – all financial and viability details, affordable housing provisions, pubic open space requirements and developer’s protected profit levels are completely redacted.

Extract from the redacted partnership agreement

Amongst the unredacted information is a reference to “Seymour Street Homes Ltd” as the affordable housing provider. Companies House records show that this is a recently incorporated and wholly-owned subsidiary of the developer British Land, part of a new trend in affordable housing provision that shifts it further from public control.

Extract from the redacted partnership agreement

Development partnership agreements, like the one for Canada Water, are invariably used for big developements, and if Southwark wants to avoid the controversies caused by the eventual publication of the Heygate and the Aylesbury partnership agreements, it should be fully open and transparent about the agreements it makes with developers.

8. Keep Walworth Town Hall in public ownership

Having sold off all Bermondsey and Peckham Town Halls, it was a relief when Southwark made a solemn promise to restore Walworth Town Hall & library to public use after it was badly damaged by a fire in 2013.

It is therefore disappointing, but maybe unsurprising, that Southwark has now gone back on that promise, claiming that it doesn’t have the funds to restore the Town Hall back into public use.

The Walworth Society is objecting to the Council’s current plan to privatise it and makes the very good point that if the two shortlisted developers “are able to redevelop the Town Hall buildings for up to £20 million and then make a profit from them with a commercial development, why could not Southwark redevelop them for a similar amount and include a significant proportion of commercial usage.” Consultation on this runs to 21 Jan; this is a link to the Walworth Society objections.

Southwark should stick to its original promise and restore the Town Hall to public use.

9. Reconsider its funding choices?

While Southwark argues that it doesn’t have enough money to restore Walworth Town Hall, shortly before Christmas Southwark’s Cabinet agreed to the purchase of ‘Courage Yard’, a commercial development in Shad Thames. SE1 website reports that the Council is paying £89m for the site – nearly twice what the current owner paid for it in 2015.

According to this Council report (para 21) Southwark owns £232m worth of such commercial investments, which currently provides a net total of £9.2m per year in revenue (3.9% return), but this appears to be less than the amount it is paying in interest on its debt – 4.6% on £563m (para 41).

Southwark is also spending £10m per year on bed & breakfast accommodation for its homeless residents, so, refurbishing Walworth Town Hall, reducing debt, or reducing temporary accommodation costs, by building more council houses, more quickly, all seem plausible alternatives for spending £89m.

Southwark has a large and diverse number of assets, which need to be managed in a prudent manner, but it should remember that it remains, first and foremost, a local government authority, not a speculative property developer.

10. Treat the traders at the Elephant shopping centre fairly

Elephant shopping centre developer Delancey has finally secured approval of Castle Sq, the temporary facility for displaced shopping centre traders, after making a last minute concession reducing the rents to between £18 and £24 per square foot; a significant victory for traders and campaigners, to join at least two others – the provision of Castle Square itself and the increase in social rented housing from 33 to 116 units.

However, Castle Sq is much too small and many traders will be looking at alternative premises, such as new units at the bottom of Perronet House, over the road from the Bakerloo line tube station. These are also not ideal, but as the landlord, Southwark could make traders lives a lot easier by charging rents no greater than those Delancey will be charging.

(We will be writing more on the whole shopping centre redevelopment shortly.)
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Recent Articles:

E&C shopping centre – Delancey stumbles after Mayor’s approval
Elephant shopping centre – decision day
Castle Square – Delancey responds
11000 new council homes: figures show loss rather than gain

Dec 16, 2018 12:00 am

A week of mixed fortunes for developer -Last Monday, shopping centre owner and developer, Delancey, seemed to have finally secured full approval for the redevelopment of the Elephant shopping centre, when Mayor Sadiq Khan declined to intervene in the decision-making. In doing so he allowed Southwark Council’s decision to approve the application to stand and joined them in defying written objections from seven local ward & constituency level Labour parties [^1], two London Assembly members and over a thousand formal objections submitted by local people, against Delancey’s disastrous redevelopment of the Elephant & Castle shopping centre.

Come Tuesday, though, and it was a different story when Delancey failed to secure another planning approval, for a vital condition of the shopping centre scheme. After a vibrant demonstration outside Southwark’s HQ in Tooley St, including impassioned speeches from the Latin American community, planning sub-committee B deferred a decision on Castle Square, the temporary boxpark facility for displaced traders. Delancey is obliged to get this planning consent before it can go any further with the shopping centre redevelopment.

To make matters worse for Delancey, it now looks certain that it will miss the 18 December deadline for concluding the legal S106 agreement that sets the seal on the planning approval. This missed deadline puts the power to refuse the application into the hands of the Director of Planning.

The Director of Planning has every reason to make this refusal, judging by what was heard on Tues evening. Council officers acknowledged that Castle Square would not be suitable for every kind of trader, while asserting that it was just one of the relocation options. Traders point out that it is the only purpose-built option and even when all the alternatives are taken into account there is still a shortfall in floorspace.

Close questioning from sub-committee members revealed other shortcomings, including an obvious one, that should larger traders take units in a yet to be settled flexible design, the Square would accommodate fewer traders in number. Distriandina, home to the Colombian cafe and restaurant, the ‘Heart of Latin London’, and currently occupying Arch 6, testified that Castle Square was not a feasible alternative for them at all.

Delancey has also been dragging its feet setting up the Trader Panel, which has meant that traders have had little influence over the design of Castle Square, prompting several practical objections, such as lack of window space to display goods. Nor has the Traders Panel been able to address fundamental issues, like leases that provide some certainty beyond the lifetime of Castle Square and the rents to be paid, the latter being the biggest problem for sub-committee members. Delancey claimed that the rents to be paid would be on a par with what is being paid by traders at the moment, with officer’s citing an average rent of £64psf. This was fiercely contested by the Elephant Traders Association and so the sub-committee deferred a decision on the application, to allow officers to gather better information.

The sub-committee is due to reconvene for a decision on Castle Square on 7 January 2018, other details to be announced.

Mayor gives dire scheme his approval

Hopes that the Mayor would have had the courage to reject the main shopping centre scheme were sorely disappointed by his refusal to intervene. It transpires that the decision was passed on to deputy mayor for planning, Jules Pipe, when the Mayor cited a conflict of interest, being chair of TfL, who are party to the scheme’s s106 agreement, including a deal for Delancey to provide a new Northern line tube entrance. The decision still remains the Mayor’s, though, in a formal and legal sense.

The decision was announced in a report and press statement which claimed further improvements negotiated by the Mayor, including an extension to the length of time traders would benefit from below-market rents to 15 years. This is better than the current 5 years, but its benefit depends on what the market rent is taken to be, and the Castle Square meeting shows there is no agreement on this. The statement also says that there will be ‘35 per cent…social rent… or other genuinely affordable levels’. The report shows this to be 116 social rented units, which is neither more than there was when the decision was referred to the Mayor, nor enough to meet Southwark’s planning policy, which would require around 170 social rented homes. The top end cap for discounted market rent, aka affordable rent, has been reduced from £90k to £60k, but this makes for a ‘genuinely affordable’ rent only in the Mayor’s imagination.

Delancey, TfL and UAL win, local people lose?

Delancey’s grudging improvements to their money spinning scheme betrays their reluctance to do anything for local people. The delay in bringing forward Castle Square to the last minute has backfired and there is now a chance to refuse the shopping centre scheme, a scheme that is disastrous for traders, the Latin American community in London, as well as offering both much less social rented housing than we need and less than we should be getting.

This chance for a refusal should be taken. All the big beasts – the Mayor, TfL, UAL and Southwark – have been focussed on what they can get out of the development, in the shape of new tube stations and university campuses, much needed no doubt, but gained at the expense of local traders and real affordable housing. They all supported the scheme with little reservation when it was first proposed and it took the local community to step forward, and by outright opposition wrest a few small, but important concessions, from Delancey.

Come the 19th December, Southwark’s Director of Planning can redeem the council by finally putting this scheme to a merciful end. It must not be allowed to destroy the long-standing, vibrant, mixed Elephant and Castle community, a home to working people from around the world for decades. If he does not do so, the local community and all its supporters – traders, residents, local councillors, students, TRAs and trade union branches – will be rallying at Southwark HQ once more on January 7, in support of the traders’ demands for space at rents that allows all of them to continue their businesses and to earn a livelihood for themselves and their families.

Footnote:
[^1]: The following parties wrote to the Mayor objecting to the scheme’s failure to meet minimum affordable housing requirements and provide sufficient relocation measures for traders: Bermondsey & Old Southwark Labour Party; Borough & Bankside Labour Party; North Walworth Labour Party; Faraday Ward Labour Party; St George’s Labour Party; Chaucer Ward Labour Party; Camberwell & Peckham Labour Party.
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Recent Articles:

Elephant shopping centre – decision day
Castle Square – Delancey responds
11000 new council homes: figures show loss rather than gain
Elephant Shopping Centre – traders and campaigners step-up the fight