Leaseholders on the Aylesbury estate have won a great victory in defence of their homes, after the Government refused Southwark Council's application to compulsory purchase their properties.
The judgement is a humiliating blow to the Council, who are found to have not taken reasonable steps to negotiate with the leaseholders and to have not made a "compelling" enough case for the Aylesbury regeneration scheme's merits.
The Government therefore refused to override the leaseholders' interests and interfere with their human rights by forcing them to sell their homes. The decision was taken by the Secretary of State for the Department of Communities and Local Government (DCLG), Sajid Javid.
Eleven leaseholders objected to the CPO and gruelling hearings before the DCLG inspector were heard in April, May and October 2015. The leaseholders live in the Bradenham, Chartridge, Arklow and Chiltern blocks - the 'First Development Site' (FDS), which was granted planning permission in April 2015. Over 200 leaseholders have been decanted to make way for the scheme to date, only 3 of whom have been rehoused on the Aylesbury. There are around 300 leaseholders remaining on the rest of the estate.
CPO Public Inquiry - Council lawyers(left), Inspector Coffey(centre), Aylesbury leaseholders(right)
In his damning decision, the Secretary of State has said that Southwark has not fulfilled its Public Sector Equality Duty. He points out the majority of the estate (67%) are from black or ethnic minority backgrounds and it is 'highly likely that there is a potential disproportionate impact on [these groups] who are .. likely to have to move out of the area if the Order is confirmed.' He goes on to point out the disruption caused to residents' social and cultural life by the regeneration scheme. The Secretary of State was particularly concerned about 'uprooting' children 'at a vulnerable stage in their development' and the detrimental impact this would have on their education and future employment prospects.
In the Secretary of State's judgement, the rehousing options offered to leaseholders would either impoverish them by requiring them to spend all their savings, or leave the area altogether in search of cheaper housing elsewhere. The inspector's report has this to say about elderly leaseholders in particular: 'Many of the leaseholders are of an age where they would be unable to obtain a mortgage to make up any shortfall and their future earning potential is limited. The requirement to use their savings and other investments severely limits their ability to choose how they spend their retirement and the use to which they put their savings and investments.' (Para. 372)
Notting Hill gets cold feet
While the Secretary of State accepted that the regeneration scheme was viable, Southwark's development partner, Notting Hill Housing Trust (NHHT) plainly had concerns about the costs even before the CPO decision was issued and has made a whole series of financial demands, which are to be agreed at a Cabinet meeting this coming Tuesday. NHHT is said in the Cabinet report to demand that Southwark shoulder the ongoing site assembly costs of the scheme, because of the delay and uncertainty resulting from the CPO. NHHT is demanding that Southwark forward fund £21m of the ongoing costs of progressing the scheme, that it was originally required to fund under the terms of the Development Partnership Agreement:
- £16.8m demolition costs for the First Development Site
- £0.8m for the demolition of Plot 18
- £2m to underwrite the cost of Plot 18's planning application
- £2m to underwrite the design fees for phase 2
These costs are in addition to the Council's other costs that it has already agreed to allocate to the scheme. In total the Council is now forecast to spend £52.5m over the next three years on the Aylesbury redevelopment scheme[^1].
Notting Hill Housing's commitment to the scheme is also plainly a concern. The report goes on to say that 'if the scheme has not proceeded in accordance with the DPA (Development Partnership Agreement)' then 'at that point all design work will pass to the council enabling the council to market the site'[^2] - in plain language: if Notting Hill drops out then Southwark takes over and looks for another developer.
The CPO decision is a serious indictment of Southwark's conduct since the start of the scheme in 1997. It confirms what leaseholders on the estate have always known - Southwark wants to remove them as cheaply as possible and has little concern for how it damages them personally or where they go. This bad treatment goes beyond leaseholders; it takes in the majority of residents on the estate who come from black and ethnic minority backgrounds and whose interests have not been protected as they should have been. On top of this, Southwark's development partner NHHT is clearly getting cold feet. All in all, the flaws in the regeneration scheme are opening up and Southwark Council should take the opportunity now to consider its whole future.
The decision could also have wider implications; this legal opinion heralds the decision as a possible 'right to a community' for council estate residents.
We conclude this blog post with one of the concluding paragraphs of the inspector's report:
[^1]: See paragraph 17 of the Tues Sep 20th 2016 Cabinet report
[^2]: See paragraph 13 of the Tues Sep 20th 2016 Cabinet report