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LCA Managing Director, Insight, and LDN Editor Jenna Goldberg
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AUTUMN STATEMENT LOWDOWN
So what does Jeremy Hunt’s Autumn Statement herald for London? The capital has largely reacted with dismay to the package of £55bn in measures, split about 50:50 between tax hikes and spending cuts, with media from the BBC, to the Evening Standard and MyLondon tallying up the Statement’s costs for different kinds of London households and organisations. The OBR’s grim forecasts, which predict a two-year recession, also went down like a lead balloon. Mayor Sadiq Khan has branded the Statement ‘Austerity 2.0,’ arguing that it ‘will disproportionately impact the least well-off’ and fails to support small businesses, as well as pointing out that it shelves VAT-free shopping for overseas visitors, something many thought was one of the better ideas in the otherwise catastrophic Truss/Kwarteng mini budget. Meanwhile, Chair of London Councils Cllr Georgia Gould argued that enabling a 5% Council Tax hike ‘is not the answer’ to boroughs’ financial woes. The capital’s business associations, including BusinessLDN, London Chamber of Commerce and Industry, and New West End Company, have lamented the fact that the Statement offered little more than a rear-guard action to ensure economic stability and little by way of incentives for growth.
Doom and gloom aside, there are silver linings: The G15 group of London’s biggest housing associations has welcomed decisions to increase social security in line with inflation and cap social rent increases at 7%; UKHospitality and the British Retail Consortium (BRC) have welcomed business rates relief and indeed high street retailers (a major component of London’s economy) have been described by some as the ‘big winners’ of the Autumn Statement.
The expansion of London’s Ultra-Low Emission Zone (ULEZ) to cover the whole of the capital has taken one more step forward. Last week a majority of London Assembly members voted in favour of an expanded ULEZ (as part of a revised transport strategy) from August 2023, meaning that anyone in a non-compliant vehicle wanting to drive into London would have to pay £12.50 per day to do so if the plans are given final approval by the Mayor. The GLA Conservatives, who have been opposed to the ULEZ expansion from the outset, have more recently commissioned a poll which found that 51% of Londoners oppose it. However, the way in which the question was phrased has been called ‘misleading’ by the Mayor, as it stated that the expansion was being carried out to ‘generate additional revenue for TfL’ (possibly skewing the responses). Separately, responses to TfL’s formal consultation on the plans are still being analysed and the Mayor has said that he will take officers' report into account when making a final decision. The issue of pollution in London cannot be overstated, with recent City Hall analysis showing that over 3,600 children in the capital were admitted to hospital with asthma in 2021/22, a 64% increase on the previous year, thought to be a result of increased pollution levels.
The Mayor of London’s record on policing matters remains under intense scrutiny following a heated exchange with Sir Tom Winsor this past week. Sadiq Khan and Sir Tom, the author of a report concluding the Mayor did not follow ‘due process’ when he withdrew his support for former Metropolitan Police Commissioner Dame Cressida Dick, clashed during a London Assembly Police and Crime Committee meeting. The Mayor said the investigation was ‘biased’ and it ‘ignored facts,’ strongly implying that Sir Tom's ‘close association with the former commissioner’ and ‘former home secretaries’ influenced his conclusions. Sir Tom’s rebuttal was punchy, describing the Mayor’s accusations as ‘absurd’ – and indeed the Mayor did not seem to offer any evidence to support his fairly serious claims of partiality. Sir Tom went on to state that the Mayor’s engagement with the investigation was ‘remarkably slight’ and led to the report’s publication being delayed by several months. The exchange does not signal the end of the matter as Khan has once again been summoned by the committee to face questions on 13 December. Meanwhile, the Home Secretary has continued to attack the Mayor on his policing record, claiming in response to a parliamentary question from former Prime Minister Boris Johnson that Khan is ‘wholly failing at fighting crime’ and has overseen a 9% increase in crime. We have struggled to find data to support her claim.
CROYDON BUST (AGAIN)
Croydon Council has effectively declared bankruptcy for the third time since 2020, saying it is unable to fill a £130m budget gap. Croydon issued the first of its Section 114 notices under its previous Labour administration and has since received extensive central government support, including a £120m loan, while facing intense scrutiny and being forced to find about £90m in cuts (including job cuts), as well as make £50m in asset sales to date. Jason Perry, the directly-elected Tory Mayor who came to power only in May 2022 has now admitted that his administration will need more such support. Naturally (though not necessarily unfairly) Perry points to his predecessors as the culprit, arguing that they left ‘a legacy of unprecedented financial mismanagement, toxic bad debt and a lack of governance and transparency.’ Looking ahead, the borough is hoping to raise about £100m by selling 18 properties, including the Colonnades retail park. It is also, as reported by The Guardian, asking the Government to ‘write off £1.3bn of debts’ and for permission to raise Council Tax rates by more than 5%. Perry is resigned to the fact that cuts will also be necessary and that Croydon Council will, as a result, ‘do and spend less, with significant spending reductions.’ As of writing, the Government has yet to agree to any of Croydon’s requests.
LONDON PLANNING ROUNDUP
- The City of London Corporation has approved plans to proceed with a £1bn regeneration scheme that would see the historic Billingsgate and Smithfield markets relocate to a purpose-built site in Dagenham Dock. A private bill will be considered in Parliament to confirm the City’s decision.
- Meanwhile yesterday the City of London Corporation also unanimously approved the revised planning application for the Museum of London’s move to West Smithfield – a landmark project for the capital which LCA is proud to have supported from the beginning (more on this in ‘Our Week’).
- The OPDC Planning Committee has approved Pocket Living’s plans for its first build-to-rent scheme on the Atlas Road site in the Old Oak Opportunity Area. The scheme will deliver 456 homes (35% affordable).
- Tower Hamlets Council’s Director of Legal and Monitoring Officer has ‘quashed‘ the Council’s own plans to redevelop an estate in Stepney Green after finding the Mayor of London was not notified at the right time.
- TfL has confirmed its intention to submit a new application to the government to secure permission for the use of operational land at Cockfosters Station in Enfield, after its previous bid was turned down earlier this year.
- sineQN has launched a public consultation on their plans for the Mayer Parry Wharf Data Centre, in Canning Town, Newham. The Campaign to Protect Rural England has meanwhile vowed to oppose Digital Reef’s proposals – endorsed by local council Havering– to build ‘Europe’s largest data centre’ on green belt land.
A 24-HOUR CITY
The GLA has announced three new Night Time Enterprise Zones which will receive funding to support a sustainable 24-hour economy on their high streets. Bromley town centre, Vauxhall and Woolwich have been allocated £130,000 each to work with local people and businesses on measures to make their areas more welcoming and boost their local economies. This follows the first Night Time Enterprise Zone in Waltham Forest, established in 2019, which resulted in a 22% increase in footfall on Walthamstow High Street. Over half of London’s boroughs submitted proposals for the funding and Camden, Enfield, Hackney, Harrow and Islington are also set to receive funding to pilot ideas to make licensing easier for businesses.
- Ian Thomas CBE has been appointed as the City of London Corporation’s new Town Clerk and Chief Executive. He takes over from John Barradell in February, after four years as Chief Executive at the Royal Borough of Kingston upon Thames.
James Beckham is standing down as head of CBRE’s London office investment team.
Frame Projects is recruiting members to join the design and quality review panels it manages on behalf of London Boroughs of Camden, Redbridge, Ealing, Barking and Dagenham, Royal Borough of Kensington and Chelsea, Havering and HS2 Ltd. Click here to find out more.
GOVE'S PLANNING POUNCE
Michael Gove chose an odd moment to table amendments to the Levelling Up & Regeneration Bill… Having submitted a Written Ministerial Statement and most of his amendments on Thursday – coinciding with the Autumn Statement – his department issued a press release only on Friday. This devilish timing means that the amendments received little press coverage and also that MPs interrogating him at Oral Questions and an LUHC Committee, both on Monday, had little time to scrutinise the changes. So what are the changes? Nothing major seems to have been cut, some elements have been fleshed out (e.g. street votes and high street rental auctions) and there are several all-new policies, notably including a clause giving councils ‘the power to decide whether to entertain future applications made by developers who have previously failed to build out existing planning permissions’ – cue protests from the sector, with both the Home Builders Federation and the British Property Federation balking at the insinuation that developers are purposefully ‘land-banking.’ There are yet more substantial changes included, more than we can cover here. Suffice to say that veteran planning lawyer Simon Ricketts’ early assessment of these changes as ‘potentially significant’ is likely an understatement.
Separately from the above, Gove’s Department has finally launched its consultation on plans for a Building Safety Levy first announced in February 2021. It will run until 7 February.
...BUT BACKBENCHERS BITE BACK
Gove may have escaped a degree of scrutiny, but he doesn’t seem to have evaded a determined group of rebellious Tory backbenchers. By all accounts this is not the first time ‘blue wall’ MPs nervous about their electoral prospects have frustrated planning reform efforts. The group, led by Chipping Barnet MP Theresa Villiers, number around 50 or so members mostly elected in the wider South East. The group’s amendments (also highlighted here in more detail) have attracted particular attention as one of their proposed changes would abolish the five-year land supply rule, which has sometimes facilitated residential development schemes in areas not allocated for housebuilding in local plans. The whole affair has triggered an almighty ruckus within the Conservative Party and across the ecosystem of right-of-centre think tanks and commentators. From our standpoint, the predicament is less a philosophical one and more a result of successive Conservative governments failing to outline a coherent framework for planning reform and to rally a critical mass of MPs behind it. In any event, the disruption caused is very real indeed; whilst the Levelling Up & Regeneration Bill is at Report Stage and debates in the Commons were scheduled for today and 28 November, the Government looks set to delay Monday’s session, citing a ‘congested parliamentary timetable.’ Sure it is...
SOCIAL HOUSING SHAKEUP?
Not content with all that, Housing Secretary Michael Gove has continued to press social housing providers following the tragic death of five-year-old Awaab Ishak, which was linked to a respiratory condition caused by mould in his home. The Chief Executive of Rochdale Boroughwide Housing, which was responsible for the management of the property, has now been sacked but Gove is keen to be seen taking further action to hold the sector to account. In a ministerial statement, he reiterated a pledge that providers found to have breached consumer standards or committed severe maladministration will be ‘named and shamed’. Gove also wrote to both local authorities and housing associations, setting out how they should be addressing complaints about mould and damp in properties. The Government’s Social Housing Regulation Bill, which will give the Regulator of Social Housing new powers, is currently making its way through Parliament and last week it was announced that Fiona MacGregor would be staying on as its Chief Executive, despite previously saying that she would step down. Beyond the standards of existing social rented housing stock, there are concerns about the the delivery of new social homes, with the latest figures from the Department for Levelling Up, Housing and Communities (DLUHC) showing that no less than forty councils in England saw no social rent housing built in five years.
There’s no sugar-coating it really. It’s been a week of bad news for the office sector, in London and further afield. A number of listed landlords signalled slipping valuations and lowered assumptions for future demand in their half-year reports. Avison Young is meanwhile the latest major commercial property services firm to announce job cuts. Remit Consulting’s latest UK-wide estimate indicates that office occupancy levels last week fell below 30% and while this partly reflected the impact of transport strikes (more of which are expected in December and January), they believe national post-pandemic figures ‘seem to have plateaued.' Deloitte’s winter office crane survey for London has meanwhile found that 55% of respondents expect a decrease in their development pipeline over the next six months and Boodle Hatfield’s research indicates that England’s office stock actually shrank 2% in the year ending March 2022. However, performance does vary across different locations and subsectors, with Savills finding that the City of London has continued to enjoy healthy growth in investment and research by Workthere suggesting that flexible offices are increasing their market share. For those interested in finding out how the inner city office ecosystem can be future-proofed, we recommend reading Central London Forward, LSE, Gerald Eve and Arup’s new report on the ‘future of the office in central London,’ launched at an event chaired by LCA’s Jenna Goldberg earlier this week. A sister report, published at the same time by the King’s Policy Institute also considered Londoner’s work/life behaviours and perceptions of hybrid working.
NOT SO NEW LABOUR? (CONT'D)
Following its latest contortions, you’d be forgiven for wondering where the Labour party’s political-ideological trajectory will take it next. Late last week, Labour signalled its intention to reform Parliament, saying it would abolish the House of Lords and replace it with a ‘new reformed upper chamber.’ The proposals, which are broadly in line with New Labour’s efforts in 1997-2009 and former Prime Minister Gordon Brown’s more recent recommendations, will likely appeal to all wings of the party. Of course, delivering major constitutional change will not come easy and the Institute for Government has argued that the proposals ‘need more work’. Separately, in a speech that many have perceived as signalling quite the swing to the right, Starmer has told the CBI annual conference that Labour wants to wean the British economy off its ‘immigration dependency.’ If that pairing of policies doesn’t strike you as odd, witness the fact that Nigel Farage has praised both proposals, claiming they’re not miles away from… UKIP’s 2015 manifesto. Elsewhere, current Chief Executive of the New Economics Foundation Miatta Fahnbulleh has beaten Johnson Situ (the party leadership’s favourite) to become the candidate for Camberwell and Peckham and Ian Byrne MP has won his reselection on Liverpool, West Derby, suggesting that a widely-reported ‘purge’ of left-wingers may not be quite as ruthlessly efficient as some would have it.
WEST SMITHFIELD GREENLIT
LCA is delighted to have helped support the Museum of London secure consent for its revised plans to create a world-class museum in West Smithfield. LCA has worked with the Museum of London since plans were first announced in 2015. A planning application was approved in 2020 and subsequently revised to reflect policy changes in the London Plan. These changes do nothing to detract from the overall ambitions of the London Museum however, which is set to become one of the capital’s top visitor attractions, capable of welcoming over 2m visitors a year.
LCA SELLS IN
As our client The Earls Court Development Company (ECDC) completed the acquisition of the 15-acre Lillie Bridge Depot site, we were pleased to help them secure several pieces of coverage across the trade press, including in Property Week, React News, Construction Enquirer and Housing Today. The acquisition of the land is an important step forward for ECDC who will be launching their masterplan for the site this winter.
OUT AND ABOUT
LCA dispatched its borough specialists to events far and wide over the past week, from North London to the far South of the city. Senior Account Manager Nadine Elomri was at Develop Croydon Conference 2022, where she found that the financially strained local authority is understandably keen to drive inward investment and explore new partnerships. Meanwhile, Associate Director Jay Allan attended the Waltham Forest Investors' Summit 2022, where the council’s leadership enthusiastically promoted their five key areas for growth, in Walthamstow, Leytonstone, Leyton, Lea Bridge and Chingford. And only today, LCA hosted Centre for London’s latest Supporters’ Network Roundtable with the Deputy Mayor for Culture Justine Simons and others, in a lively discussion about how London can maintain its credentials as a global capital of culture, chaired by our very own Managing Director, Insight, and LDN Editor Jenna Goldberg.
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LDN is put together by a dedicated team at London Communications Agency. The content for each edition is developed from news drawn from the last week from every London local paper as well as the regional and national press, from intelligence gathered by monitoring local, regional and national government activity and from the insight and expert knowledge of the entire LCA team.
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