The target given to developers to build affordable housing is being cut, with fears the decision could spread across the country. A leaked memo, seen by the i Paper, suggests that the target could be cut by more than half in a bid to allow the Government to meet its 1.5 million new home promise.
Housing Secretary Steve Reed and London Mayor Sadiq Khan have held talks over an “emergency reduction” to the Greater London Authority (GLA) target for developers to ensure that 35% of new homes are classed as affordable housing. Under the new proposals, this could fall to just 20%. The move is part of a plan to jump start declining house building in the capital, where only 3,950 new homes were completed in the first half of this year.
The figure leaves Labour significantly short of their 88,000 new homes a year target.
According to the i Paper, a memo sent to housing officials shows that could be slashed to 20%, of which developers will have to pay for 10%, with the remainder coming from councils.
A source close to Reed told the i Paper that no decision has yet been made but acknowledged his concern about the stagnant rate of house building in London, adding that affordable housing would still play “a vital part of our effort to build 1.5m houses”.
A decision could be made as early as next week.
However, councils and housing experts have warned that cutting developers’ affordable housing contribution will “be a huge blow for social housing in London”, warning that such a decision could have knock on consequences across the UK.
Janice Morphet, Professor at the Barlettt School of Planning at the University College London (UCL): “This could have long-term implications for the provision of affordable housing in London and could have a ripple effect around the country. That is because this sets a precedent and creates uncertainty about when the requirement would go back to 35 per cent.”
Affordable housing targets are set be local authorities who were last year given ambitious targets following Labour’s election victory and pledge to get the nation building once more.
The Government has pledged to build 1.5 million new homes this parliament, with 25% of these predicted to be built in London.
Aydin Dikerdem, cabinet member for housing at Labour-run Wandsworth Council, said: “This would be a huge blow to social housing delivery in London. Every planning permission we already have at 35 per cent will likely be resubmitted at the lower figure with less social and affordable housing; it won’t speed anything up, in fact, it could do the opposite.
“Land in London is finite; we need to maximise affordable housing on it. Not even Michael Gove did this.”
The Ministry of Housing, Communities and Local Government and the Mayor of London’s office have been approached for comment.