Murky Depths

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Greenwich borough

Revealed: how Greenwich Council spend developer income

Greenwich Council have released figures showing how much income they received from developers last year, how much was spent and in what areas.

As an authority near the top of nationwide charts for new developments, Greenwich receive high sums from the amount of new homes being built.

Law changes mean these figures must now be made publicly available.

Firstly, income from Section 106 over the past five years totals £48.3 million. £28.3 million has been spent over the same period.

There is a lag between commitments from developers and income being received. If we go further back the sums increase substantially. At the end of 2017 £174m was yet to be received which will come in over time. Half of all residential income is spent on Woolwich Crossrail station.

In terms of funding secured last year – these are the areas funds will be spent:

  • Employment (GLLaB) – £770k
  • Health – £31k
  • Affordable Housing – £175k
  • Transport £546k
  • Open space/parks – £10k
  • Public Realm – £27k
  • Education – zero

Some areas will also see spending from Community Infrastructure Levy funds. Section 106 income has greatly reduced since 2016 with the introduction of CIL – as seen here:

The associated report states spending allocations and focus last year for S106 (with parks and public realm missing out) was due to the transition to CIL – yet spending follows a similar pattern to that seen before the introduction of CIL as this record shows.

£1.3 million from CIL.

Looking through the document shows that almost all borough-wide S106 funds for public realm upgrades has gone towards a 2012 upgrade to Cutty Sark Gardens in Greenwich, where the water feature broke and was never fixed.

There is very little for town centres, shopping parades and areas that form the core of many communities – particularly those away from major town centres.

Another issue is parks. We recently saw how little Greenwich allocate to parks and open space from S106 income – about 0.3% last year.

One development added to the newly released s106 list this year is a tower in Abbey Wood bringing £300k in S106 to the authority. Parks look like this in Abbey Wood:

Abbey Wood park – taken summer 2018

Of £300k just £1.3k is allocated to open space and none to public realm or sprucing up a tired 3000-home estate. £253k goes to Employment (GLLaB). Trying to find out why Abbey Wood has been continually overlooked for funds has not yielded an answer.

A nearby development is bringing in £1.3 million CIL income. It’s a similar story showing the transition from S106 to CIL is not altering Greenwich Council spending priorities. None of the £1.3m income is allocated to a deprived estate next door or nearby parks but £402k will go to GLLaB. The developers have made a £50k offer for the local area above what the council requested (which was nothing).

There’s nothing wrong with some income heading to employment but the ratio appears very lopsided. The authority themselves have deemed parks, better streets, public realms and active, healthy living as priorities yet funds are not heading to those areas.

Details (lack thereof)

One concern with this data is the severe lack of detail when it comes to spending. £20k was spent on “sport” from Harvey Gardens but no details where or on what. It simply says “(blank)” under details.

Even when detail of spending is given it’s extremely lacking in this report – offering no improvement over last year.

Information of Community Infrastructure Levy spending is also extremely lacking in detail. This is not an authority that will win awards for transparency. They only revealed S106 after it became a legal requirement – unlike many other councils.

No detail on where money is being spent

Yet these funds are extremely large amounts of money and can have transformative effects. The very small sums given from CIL to community groups does wonderful work – though is the lowest levels permissible by law at 15% of income. Some other councils go above and beyond and allocate 25% of CIL “Neighbourhood Portion” income to be spent locally.

Another fund related to development, the New Homes Bonus , has brought in £66 million between 2011/12 and 2018/19 with another £11.1million due next year (the sixth highest sum out of 356 UK authorities).

What we have is a very high number of new homes, shops and other facilities bringing sizable sums to council coffers yet major questions on how and why it’s spent the way it is – and a lack of transparency over that spending.

Click here to see the full S106 list.

Click here to see the 2017/18 CIL list.


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6 Comments

  1. Paul SuperUnknown

    I maintain, the many “black holes” contained in these figures are the results of malfeasance! In truth, there is minimal oversight by an outside body, and too many foxes guarding the henhouse!

  2. tony g

    This is remarkable – S106 payments and CIL are the only way authorities can capture land value in London and try and even out the processes of urban development. As is evident here, the value captured is being wasted. Why can’t local communities have a bigger say in the distribution if these funds?

    • Andrew Wood, Cllr Canary Wharf ward

      You can. A Neighbourhood Plan can set priorities for how CIL earnt within a specified Area should be spent. A Parish Council (like Queens Park in West London) also receives 25% of CIL within an area.

      “Communities without a parish, town or community council will still benefit from the 15% neighbourhood portion (or 25% portion, if a neighbourhood plan or neighbourhood development order has been made). If there is no parish, town or community council, the charging authority will retain the levy receipts but should engage with the communities where development has taken place and agree with them how best to spend the neighbourhood funding. Charging authorities should set out clearly and transparently their approach to engaging with neighbourhoods using their regular communication tools eg website, newsletters, etc. The use of neighbourhood funds should therefore match priorities expressed by local communities, including priorities set out formally in neighbourhood plans.” Government regulations

  3. Graham

    How can £770K be spent on GLLAB (Councils recruitment agency) and only 31K spent on Health and just 175K be spent on affordable housing. when the council has a massive waiting list for social housing,

    This is appalling. How can Labour Controlled Greenwich Council go on and on about cuts to health care and social housing when they do not spend on themselves. Despite receiving money from developers to do so.

    To me this is clearly double standards from the current Labour administration on Greenwich Council.

  4. A D

    It’s quite remarkable that a Labour council ignores all those other areas. Even odder that they won’t answer questions on this matter and brings up a drawbridge…

    Anyone contacted their councillor about it? I have and ignored.

    I bet they’ll make a song and dance about funds announced this week. They wont say it’s the bare minimum they have to give and is a tiny amount of the many, many millions they receive.

  5. Joe

    You need to join the Labour Party and take part in your local ward and constituency meetings to create change. Otherwise the right wing Labour councillors are just as bad as the Tories with no checks and balances.

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