London councils allowing developers to dodge affordable housing allocations through cash payments

17 February 2016, Blog

The business lobby group, London First, has reported that councils in the capital are accepting an increasing number of cash payments in lieu of affordable homes. In 2014, developers were shown to have spent more than £250m, far more than the £20m spent in 2011. The Borough of Kensington and Chelsea was shown to be the worst offender.

In The London Plan that has been adopted under mayor, Boris Johnson states that in “exceptional cases” payments can be made instead of on-site affordable housing provision “where this would have demonstrable benefits in furthering the affordable housing and other policies in this plan”.

The real problem is that the money paid to the council to bypass the provision of affordable homes is not regulated, and can be used on general expenditure, not directly on affordable homes.

London First recommends “that councils be required to put in place clear criteria for when the payments can be made, calculate the sums consistently and declare them to the GLA as part of its annual monitoring process.” A solution is clearly required to address the problem of a lack of affordable homes in London. 

JBP Staff Member

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