Wednesday, 04 May 2016

Fed concerned by section 106 payments

The National Housing Federation is concerned councils are too eager to accept cash payments from developers instead of affordable housing.

The umbrella body said large cash payments can prevent more affordable homes being built and stop poorer people accessing more affluent areas.

The NHF spoke out after two authorities accepted payments instead of homes in high value areas.

Westminster Council received £78 million for reducing an affordable housing requirement from the Chelsea Barracks scheme earlier this year. Proposals are in place for 123 affordable homes but developers say they are unable build any more and instead offered the cash.

Southwark Council accepted £22 million to reduce affordable homes targets on the King’s Reach development on the South Bank.

Section 106 planning requirements on large schemes can demand developers provide a portion of affordable housing on site or nearby.

If neither of these is deemed feasible developers can make a payment to the council, which is used to develop affordable homes elsewhere.

Cameron Watt, head of neigbourhoods at the NHF, said: ‘I think there is a concern because you get an immediate social benefit delivering [affordable housing] on site and we believe that successful sustainable communities should not be segregated by wealth.

‘In central London it’s not just the cash value of the section 106 for affordable housing that is the issue, it’s the access to a site.

‘Even if the local authority has a large commutable sum there is no guarantee they will be able to access that site to deliver the sum of affordable housing required as good sites are so scarce.

‘There does seem to be a worrying trend that some local authorities are giving in a bit too easily to developers.’

Both Westminster and Southwark Council have said affordable housing would not be feasible on the schemes and the money will be used to identify and develop sites for affordable homes elsewhere.

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