Agenda item

Report of the Director for Housing, Regeneration and Planning. To be introduced by the Cabinet Member for House Building, Place-Making and Development.

This report makes recommendations towards the next stage of the housing delivery programme, including accepting the Greater London Authority (GLA) grant from the 2021-26 Affordable Housing Programme and delegating additional authority to vary construction contracts. Cabinet is also asked to remove five sites from the programme.

The Cabinet Member for House Building, Place-Making and Development introduced the report which made recommendations towards the next stage of the housing delivery programme, including accepting the Greater London Authority (GLA) grant from the 2021-26 Affordable Housing Programme and delegating additional authority to vary construction contracts. It was also requested that three sites were removed from the programme.

The Cabinet Member stated that the housebuilding programme was central to this administration. It was noted that the homes would have high quality design and would be energy efficient, including elements such as solar panels, green roofs, energy efficient products, and air source heat pumps which should reduce heating costs for residents..

The Cabinet Member explained that there were some changes in relation to Right to Buy receipts to include the delivery of new homes in order to reflect new government guidelines. It was noted that additional contingency sums were requested to recognise the significant increase in the costs of construction materials and these were detailed in the exempt part of the report. It was added that the report also sought approval to remove three sites from the list of acquired sites.

The Cabinet Member responded to questions from the Cabinet:

-       It was noted that funding was only available for units that replaced homes that had been or would be demolished in exceptional circumstances. It was clarified that this referred to the new programme and did not apply to Broadwater Farm or High Road West.

-       The Cabinet Member for Environment, Transport, and the Climate Emergency and Deputy Leader noted that there was limited available land for housing and that schemes should increase biodiversity and greenery as much as possible.

The Cabinet Member responded to questions from Councillor Barnes:

-       It was confirmed that four schemes would be zero carbon  and that all others would achieve over 50% reductions in carbon, with most achieving over 70%. It was explained that it was aimed to achieve as close to zero carbon as possible for all schemes but that this was not always possible due to the particulars of sites.

-       It was noted that it would not be possible to include the site on Moselle Road as part of the housing delivery programme but that officers could provide an update to Councillor Barnes about the future of the site. 

-       It was confirmed that there was a target to deliver 3,000 homes and that the first completions had been delivered in 2021.

Following consideration of the exempt information, it was

RESOLVED

1.    In accordance with Contract Standing Order 17.1, approve the acceptance of capital grant under the Mayor of London’s 2021-26 Affordable Homes Programme, the terms of which are summarised below at 6.14 – 6.15 and available in full at the GLA web site.

2.    Delegate authority to agree the final 2021-26 Affordable Homes Programme grant documentation and contract to the Director of Housing, Planning and Regeneration, after consultation with the Director of Finance and the Head of Legal and Corporate Governance (Monitoring Officer).

3.    Agree from April 2022 to extend the use of retained Right to Buy receipts in the housing delivery programme in accordance with Government guidance of July 2021 and the Retention Agreement pursuant to section 11(6) of the Local Government Act 2003 dated 7 October 2021 and attached as Appendix 1.

4.    Approve additional contingency sums as specified in in the exempt report Appendix 2 and delegate authority to the Director of Housing, Regeneration and Planning, after consultation with the Cabinet Member for House Building, Place-Making and Development, and Director of Finance, to approve additional spending in connection with the contracts specified in Appendix 2, including through variations or cumulative variations of those contracts, to the value of those additional contingency sums.

5.    Remove three sites listed below at 6.31 to 6.33 from the Housing Delivery Programme.

Reasons for decision

The Council is committed to a new era of Council house building in Haringey. These decisions are an essential step in achieving that aim.

Accepting grant through the Mayor of London’s Affordable Homes Programme 2021-26: It is not possible to fund the building of Council homes at scale only through borrowing against future rental income. Capital grant has always formed a vital part of the funding mix. The terms of the Affordable Homes Programme 2021-26 are in a standard form and not subject to negotiation.

The use of Retained Right to Buy receipts: In July 2021, new Government guidance constrained the ability of Local Authorities to use Retained Right to Buy receipts on the acquisition of existing homes. These new terms are included in the Retention Agreement agreed with the Government on 7 October 2021. It is therefore necessary that from April 2022 the Council extends its use of Retained Right to Buy receipts to include the delivery of new homes.

Delegating authority to vary the housing delivery contracts up to the value of the contingency sums specified in Appendix 2: In the last six months, the cost of construction materials and labour has risen and continues to rise very substantially. As a result, it is likely that additional costs will arise in connection with the contracts specified in Appendix 2. Providing additional contingency sums for those specified schemes will ensure that negotiations can be concluded as efficiently as possible, preventing further cost increases caused by contractual delays, saving the Council money, and ensuring that construction of new Council homes is not put at risk. Any decision made under this delegation would be reported back to Cabinet and taken within a robust governance and scrutiny structure.

Removing sites from the Housing Delivery Programme: The sites listed have been found to be unsuitable for housing development by the Council at this stage.

Alternative options considered

Not to accept the offer of grant from the Affordable Housing Programme 2021-2026. This option was rejected because it would prevent the Council from delivering new Council homes.

To continue spending all retained Right to Buy receipts on acquiring existing properties. This option was rejected because it would be in breach of the Retention Agreement and Government guidance and would therefore lead to the Council having to pay Right to Buy receipts to central Government.

To redirect all retained Right to Buy receipts to support the Council’s housing delivery programme. This option was rejected because the acquisition of homes to use for homelessness prevention purposes meets key strategic and financial priorities by helping to ensure that the Council can provide high quality housing solutions for households that are homeless.

Not to approve the contingency sums and not to delegate authority to vary contracts up to the values of the contingency sums specified at Appendix 2. This option was rejected because it would lead to delays in contract negotiations for which the Council would be subject to extension of time claims at further cost, and further delays to programme delivery putting at risk achievement of the Council’s core objectives.

Not to remove the sites listed from the housing delivery programme. This option was rejected because these sites are not suitable for housing development at this stage.