Star date: 27th May 2015 

£19MILLION AND 830 AFFORDABLE HOMES LOST TO SALFORD IN JUST 12 MONTHS

After years of the Salford Star documenting how developers in the city are avoiding paying planning fees and building affordable homes, the pressure is growing on Salford Council to make the process more transparent.

Salford has lost £19million in planning fees and 830 affordable homes in the last twelve months alone, as developers have submitted confidential reports showing that their schemes would not be `viable' if they had to pay the fees – even though in some cases they are forecast to make up to £24million profit. Now the Royal Borough of Greenwich is proposing to make the confidential viability reports public.

Full details here...

In the new print issue of the Salford Star, there is a three page investigative report detailing every single planning application submitted to Salford Council over the last twelve months in which developers have avoided paying planning fees totalling £19,275,553 and building 833 affordable homes.

Developers avoid paying the `Section 106' fees - which are for things like public realm, infrastructure, heritage, education, climate change and construction training – by claiming that their schemes wouldn't be `economically viable' if they had to comply.

Yet the Salford Star article shows that the way these `viability' figures are worked out - [an equation of A-(B+C+D+E)] - means that developers can make profits of up to £24million as part of the costs.*

In all the planning applications that cite `viability' issues, Salford Council's planning officers, the District Valuer and even, recently, planning councillors, have agreed with the developers' figures crying poverty. Yet no member of the public or press is allowed to view them.

The Salford Star constantly asked to see the `viability' assessments under the Freedom of Information Act but each time it has been turned down on the grounds of `commercial confidentiality' and, very strangely, `public interest'... "Having carefully considered that balance of public interest in this case, the Council has concluded that the public interest in maintaining the exceptions outweighs the public interest in disclosure".

Now pressure is growing on Salford Council to make the viability assessments public after the Royal Borough of Greenwich this month proposed to do exactly that.

"This is about transparency for local people" says Councillor Danny Thorpe, Royal Borough of Greenwich Cabinet Member for Regeneration and Transport "At the moment our hands are tied on affordable housing levels if the viability study shows a development won't work financially with the levels of affordable housing we want.

"This will now allow the whole process to be far more transparent – making the viability studies publicly available as part of the planning documents means the Royal Borough and residents alike can see precisely why a developer might claim they cannot meet our affordable housing targets" he adds "We believe we're the first local authority in the country to be doing this – looking at policy which insists on these studies being in the public domain."

Now the challenge is for Salford Council to follow suit. Assistant Mayor for Planning, Councillor Derek Antrobus, has called the loss of millions of pounds and hundreds of affordable homes in the city "a public scandal of immense proportions", while Conservative Party planning Councillor, Karen Garrido, recently asked at a planning meeting... "What's been going on behind the door, I don't know...I find it a quite sad state of affairs..."

As the article in Salford Star reported, the numbers of Salford households on the housing waiting list rose from 10,251 in 2013 to 11,498 in 2014, while latest figures show an average of 27 bids for every affordable flat that becomes available in the city and 38 bids for every affordable house. Yet, just 16 social rent properties were built and completed in the last financial year (2013-14).

The 830 affordable homes lost through `viability assessments' would almost cover the whole of Salford's housing needs for the next twelve months – while the £19million lost through developer avoidance would have more than wiped out all the cuts to the city's environment, community safety and leisure departments over the last four years.

Now Salford City Council must make these viability assessments public so that everyone knows exactly what is `going on behind the door'...

*The equation is A-(B+C+D+E)...

`A' is the `Gross Development Value', or income from sales, ground rents etc. From this total is then deducted land costs (B), building costs, including sales and marketing (C), interest costs (D) and developer's profit (E).

In the Council report cited in the article, a `developer's profit' of 20% was "assumed across all residential appraisals". The Council figures show that a developer building 600 high density apartments on a `premium' site, such as Salford Quays should make £24,019,200 profit.

• Read the full £19million Planning Scandal article in Salford Star print issue or in the electronic version (page 27) – click here