A overview and scrutiny committee meeting addressing a call-in by Lambeth Green Party councillors on Monday (May 4) was labelled a “farce” after the method of voting was called into question.   

Councillor Pete Elliott, along with four other councillors, called-in the business plan for Homes for Lambeth (HfL), approved in March and spanning from 2020 and 2023, over fears it does not take into account the financial risks posed by COVID-19.  

HfL, a house-building company set up and owned by Lambeth Council, builds and manages homes for people on council land, as well as controlling the estate regeneration programme.  

The council intends to build 383 new homes by 2023, 302 affordable and 223 for council rent. 

After more than two hours of debate, committee members had four voting options – not to refer back the decision to the leader of the council, not to refer the decision back but to make recommendations, to refer the decision for reconsideration with a written explanation setting out concerns, or to refer the matter to full council.  

Four members chose option one, three chose options two, and two option four.  

After the vote, opposition leader Cllr Jonathan Bartley said he thought the voting method was “undemocratic”.  

“I question the way we’ve made this decision because if we had a chance to vote on each option, as a committee, I think we might well have had a majority for option two.  

“This doesn’t seem to me to be particularly democratic,” he said.  

Leader Cllr Jack Hopkins said the vote was “as it was”, adding: “If you didn’t like the voting mechanism before the vote you should have raised it.  

“You can’t just oppose something because you don’t like the answer.” 

But Cllr Bartley, who later tweeted that the meeting was an “absolute farce”, said the leader shouldn’t have been commenting as he is not a member of the committee.  

The call-in listed eight reasons but only one, risk management in light of the risks posed by COVID-19, was accepted as valid.  

It said: “The approach to risk management, presents inappropriate risk mitigations to some identified risks and fails to identify any mitigations at all for others, is lax, to the point of recklessness, which contradicts the council’s policy on risk.” 

According the business plan, HfL will be funded by “a mixture of payments from the council for pre-development activity which will be funded from capital budgets and loans from the council for development activity and purchase of affordable homes”.  

The report requests £25m of additional capital funding for pre-development activity and £100m for buying back leasehold and freehold properties.  

“It is expected that all council expenditure will be repaid via land payments set as an obligation on HfL once the relevant land transfers to them for development purposes.  

“Loans will be repaid from revenue generated by HfL in line with the terms of the individual loan agreements.  

“The wider programme is structured so that the risk level is mitigated by having a £150m debt cap on the amount of monies on-lent to HfL for development purposes,” it states.  

According to the report, risks posed by COVID-19 will be mitigated by “remote working”, by which projects can continue to progress.  

At the meeting Cllr Elliott criticised the lack of scrutiny around the plan. 

He said the council’s previous two business plans “failed to deliver against 90 per cent of their own targets” and said the current plan posed a “substantial risk”, committing the council to spending £125 million.  

“Homes for Lambeth should have had a challenge session by the corporate committee months ago and there was one planned for this committee just as we were locked down.  

“[…]The decision to accept this business plan has not been scrutinised by the cabinet – that meeting was also cancelled at the end of March. 

“At no stage has this plan received proper internal or external scrutiny and nor has the public had an opportunity to input into it,” he said. 

He said “with all the local and global uncertainty, now is definitely not the time to be making big, long-term decisions about the future of our homes and communities,” and urged the council to pause the decision until “we know what a post-COVID Lambeth looks like”.  

Cllr Nicole Griffiths, also backing the call-in, said HfL was already on “extremely shaky ground before the COVID-19 pandemic ”, and said three of Lambeth’s “top ten risks” related to it.  

“COVID-19 may not be the biggest challenge of the decade; there is also the climate emergency and the predicted social and economic crisis in the next months and years, all completely unknown factors.  

“We do know that we’ll come out of this pandemic different to how we went in, therefore the unpredictable and very risky elements of the HfL plan have to be put on hold,” she said.  

Cabinet member for planning, investment and new homes, Cllr Matthew Bennett said the council set up HfL to tackle “the very significant housing crisis”.  

“Coronavirus is not just a major public health crisis and a private tragedy for many families, it is causing significant economic damage in Lambeth and across the country. 

“This plan represents the single biggest stimulus to our local economy that we can have as a council. 

“By taking this decision now, we have the ability to do the desk work, the designs, the consultation, the engagement, it means we will be ready to go with a £375 million investment in our local economy, creating jobs for local people, access to training, apprenticeships and skills, at a time when the economy and local communities all desperately need it,” he said.  

He denied that the report commits the council to spending £125 million, adding: “It sets out very clear financial controls and governance around the schemes within the report and sets up a framework for borrowing which would be subject to the governance framework that we have talked about.” 

He said the importance around risk is that it is “identified and managed”.  

“I want to address the claim that this report represents a systemic risk to the council’s finances or that is in anyway a blank cheque, or that we are letting loose the reigns and saying ‘that’s it, off you go’ – in every sense this is false.  

“The business plan sets out the projects we want to see delivered, it sets out the level of affordable housing we prudently think is deliverable with the grants available to us, it sets out the council’s confidence in the HFL financial model, and stress testing, and it sets limits on possible financing.  

“This is a carefully managed, well-resourced and vigorously governed framework.  

“Each phase and each project has to move through a series of gateways, checked by the executive team in Homes for Lambeth, the senior team in the council, outside advisors, scrutinised by planning, scutinised by grant funders, assessed by Homes for Lambeth’s independent board with their years of industry experience, and then and only then will funding be agreed by the council and released by the council.  

“The situation with COVID is uncertain, and unsettling, and unprecedented, but the consequent risks to development are not unprecedented,” he said.