24 May Where are the homes Southwark Council?
The UK is in the depths of housing crisis, 170,000 people are homeless in London, however wherever you turn in the capital city there is a building site. Reporter Theo Giles asks where are the homes?
One hundred years ago our capitals skyline was dominated by smoke and fog, earning it the sobriquet ‘the big smoke’. Now like jewels on our big business crown, our skyline is encrusted with cranes – it is nye on impossible to find a view of London in which even a portion doesn’t feature one. With all of this development its hard to believe that we are in depths of housing crisis. Shelter, a leading homelessness charity estimates that there are 170,000 thousand people homeless in London today – a staggering figure. So, whats going wrong? Buildings are being erected everywhere, however more and more people are finding themselves without a roof over their head. The question must be asked: where are the homes? This is the question that must be directed at local government.
In Southwarks Elephant and Castle, where I study, the picture is the same but on a micro scale. As I leave the library to get my lunch everyday I pass 3 large developments, and an average of four people who have found themselves homeless. It just doesn’t add up, so I started to investigate Southwark Councils Housing policy. In their ‘New Southwark Plan’ they outline that they aim to build 1,500 new homes by 2018 and in any new developments, 35% of homes should be at affordable rent, whilst a minimum of 25% should be social rented. So essentially for every 100 homes built, 26 of them will be rented at 60% of market rate, and 9 of them at social rent (a traditional council home).
This proposal to me seemed fair, nearly a tenth of all homes being built in Southwark will be council homes according to their planning policy – that seems quite a sizeable amount. So I started to look at all of the regeneration schemes that were underway or in the pipeline for Southwark, and I found eight schemes. Some of the schemes were huge and fixtures of Southwark, such the Haygate Estate which will bring a gargantuan 2,704 homes to Southwark and has been undergoing regeneration since 2010. Whilst others were smaller such as One the Elephant has already been finished and brought Southwark 284 new homes. In total, over the eight schemes, 6,228 homes are being built, thats 560 new council homes for the people of Southwark if Southwark Council have followed their own housing policy. Sadly not. After looking at all of the planning proposals you can find that only 82 of those homes will be socially rented – 1,418 homes short of their 2018 target. Thats 1.3% of new homes in Southwark not the 8.22% in their planning policy.
To understand why Southwark Council are failing on delivering their own planning policy, we first need to understand that these developments are not built by the local government but by big land developers that bargain with the council for the contract to build on the site. As you can imagine here there is a conflict of interest, developers are looking to make money they’re private companies, and funnily enough homes built for the poorest in our society aren’t going to be great money makers. Kate Davies the CEO of Notting Hill Housing, the Ayelsbury estates development partner wrote in a report for the Centre of Social Justice: “council estates are ‘ghettos of the poorest and neediest people’ that are ‘subsidised by the taxpayer’…social housing is not a desirable destination’, private ownership is preferable to state provided solutions”. So it is obvious these development partners are not aiming to provide social housing, quite often they will convince the council in a viability assessment that it would be uneconomical for them to build the amount of council homes required by planning policy. And the best bit is…the viability assessment is confidential, so in most cases the public have never been able to see how or why we have been robbed of our council homes.
Take for example the Haygate estate, which is where the only 82 socially rented homes will be coming from out of the 8 schemes I looked at earlier. It took Aidrian Glasspool, a resident of the Haygate 3 years to obtain the viability assessment after many appeals by Southwark Council and they’re developer Lendlease. Within the assessment Lendlese argued that they would need to make a minimum of 25% profit on the scheme – three hundred million pounds. Although Southwark Council had contractually agreed to 20% already, after the viability assessment they agreed to 25%. This raise in profits serves to inflate the development costs and in turn lower the amount of socially rented homes. In this case the drop was from 432 socially rented homes (based off Southwark Council Planning policy) to 82.
The salt in the wounds here is of course, the projected profit of the development in the viability assessment is a fraction of what is actually being made by Lendlease. In the viability assessment Lendlease predicted they would be able to sell newly built properties at £600 psqft, however if you take a trip down to the marketing showroom for the development, you’ll find that the latest phase of flats to go on sale are being sold at an average £1,012 psft – £400 more than outlined in the viability assessment.
So in a nutshell they have wriggled out of building enough council homes by saying it will too expensive, but then have proceeded to sell the properties at 168% of the price they predicted in the assessment. Truly criminal.
What is more criminal however is what they are doing to the residents of the homes they are building over. The council and they’re developing partners will obtain homes from residents by a Compulsory Purchase Order. On huge council estates such as the Haygate in Elephant and Castle or the Ayelsbury in Walworth, many of the residents have bought the homes over time from the government. However, the land is still owned by the council, so they can enforce a CPO if they want to re-develop the estate. A CPO is effectively where the council buys the home form the resident at a price they set, there can be three appeals by the resident but no more. The first problem that arises form this is that Southwark Council never seem to want to pay full whack for the homes, they want ‘mates rates’.
Beverly Robinson, an Aylesbury Estate leaseholder, bought her property a decade before the regeneration began under the governments right-to-buy scheme. Five years after buying the property she told me she had received a letter saying that is was going to be acquired via CPO, with an initial offer of £65,000- she rejected that and two other offers but the final offer was £117,000. Beverly decided to get her home privately valued, the valuation came back at £290,000, which is more than double the councils offer. She told me : “It feels like I being pushed out of my own home, my own area – I cant afford to relocate here”. The story is even more shocking for Adrian Glasspool, a Haygate estate resident. He had his home acquired via CPO during the initial stages of regeneration on the estate for £225,000. If he wanted to re-buy the same 3 bed ground floor maisonette he had before on the new development it would cost him one million pounds. He told me: “We’ve been sold out by our own council, they’re only serving themselves”
The question is why are Southwark Councillors, short changing Southwark residents for big developers profits? Journalist Anna Minton wrote: “20 percent of Southwarks 63 Councillors work as lobbyists for developers in the planning industry…. Making use of a very well-oiled revolving door”. And she’s not wrong. Many Council officers and councillors have gone on to work to work for developers on projects they sold as a councillor. Take for example Tom Branton who was Southwarks lead officer for the procurement of the LendLease deal, and authored the report recommending the council sign the regeneration agreement in 2010. However, by 2011 Branton had decided to had in his notice and end his time at the council and instead work for Lendlease as the Development Manager for the Elephant & Castle project. An even more current example is Southwarks current council leader, Cllr Peter John OBE, who sold the Haygate to Lendlease at a third of market value (It was sold for £50 million, after being valued at £150 million). John got himself in a bit of bother after it was revealed he didn’t declare tickets to the opening ceremony of the London Olympics given to him by Lendlease. He has also accepted an all expenses paid trip to a property fair in Cannes, South of France by his friends at Lendlease.
Tanya Murat is the Head of Southwark Defend Council Housing, an activist group that organises rallies and protests to fight the destruction of Council Housing in Southwark. When I spoke to her she told me; “Regeneration is not for the people its is for big business, its used as a guise for social cleansing and profiteering off of the working class”. We are now living in a time where less council homes are being built per year than 50 years ago, and its the working class who are feeling it the most. Out of the 250 leaseholders that have been removed from the Aylesbury Estate only 7 have been able to take up a shared ownership of one of the new (yet to be built) properties. The other 243 homeowners are unaccounted for, only to be replaced by people who can afford their own little slice of million pound South London living.
I have emailed Cllr Peter John OBE countless times requesting for an interview and have received no reply. I often wonder why.
