The Mayor of London’s decision to slash affordability quotas for developers from 35 to 20 per cent was “not in a place any of us wanted to arrive at”, the deputy Mayor for Housing has admitted.
Tom Copley told the London Assembly yesterday (Thursday 4 December) that the capital’s economic context was far different to when the current London Plan was devised in 2017.
This was due to a “perfect storm of challenges”, including soaring interest rates and construction costs, that have seen affordable housing starts stagnate well below the Mayor’s targets.
Data from the Greater London Authority (GLA) shows that developers made just 1,239 starts on affordable homes from April to September this year, compared to 3,991 in the whole of the last financial year.
In response to London’s performance, ministers struck a deal with Sir Sadiq Khan to implement an “emergency housebuilding package” that would involve a significant reduction in the requirement to qualify for fast-track planning status.
The move has prompted significant concerns from the Mayor’s City Hall opponents, including the Green Party’s Zoe Garbett, who accused him of “protecting the profits of developers who got us into this mess”.
Ms Garbett directly challenged Mr Copley over the issue yesterday, suggesting the GLA “gave up too early” and conceded to the wishes of major construction firms.
She said: “The 35 per cent was meant to be the beginning, it was meant to be the first step, and this is a problem that predates the recent context.
“There’s more things that could have happened before we you know bow to the developers.
The deputy Mayor responded: “Let me be absolutely clear – this is not a place any of us wanted to arrive at.
“I don’t think any of us on this panel wanted to be in a position where we have to lower affordable housing requirements. But the world we are in today is completely different from the world that we were in in 2017 when the 35 per cent threshold was created.
“It’s all very well saying we you know we should just stick to that, we should stick to 35 per cent, we should just wait it out. The Mayor and I were not willing to do that because to be to be clear, 20 per cent of something is better than 35 per cent of nothing.
“It would have been really, really easy for us to wait and see if things get better – but the politically difficult thing to do was to go ahead and create the emergency package.
“There are any number of factors that come into play over the last five or six years, and the GLA and largely the government have no levers in which to move them.”
Mr Copley said he wanted to stress that the new threshold was “temporary” and that the government had allocated City Hall a £322million investment fund in the package, intended to accelerate housebuilding and unlock stalled sites.
“The idea is that we get as much new affordable development and therefore as much new affordable housing in in a brief period of time while we get the market going,” he added.
“This hasn’t replaced the 35 per cent rate – there are still developers that we’re working with who are actively sticking to that because the timing works for them and the short term measures don’t.”
Mr Pipe said the concessions made in the emergency package were due to falling “viability” for developers to build in the capital.
“It’s a completely, different world,” he told the London Assembly.
“The big issue facing the GLA planning team for the next London plan is how we go forward in this economic context.
“The primary aim of the plan is to bring forward housing at volume, but also to bring housing forward that’s of good quality.”
Earlier this year the GLA and Ministry of Housing, Communities and Local Government (MHCLG) agreed to lower London’s target for the Affordable Homes Programme (AHP) for 2021-2026 by over a fifth to between 17,800 and 19,000 starts.
But with just 6,370 affordable homes started since the AHP was signed off in 2023, there are major doubts as to whether City Hall will hit the revised target.
In order to meet the Mayor’s promise, developers will need to start on at least 11,430 affordable dwellings before March 2026.
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