Tuesday, 29 March 2011

VNEB S106 Representation - VNEB Infrastructure Report by KAPF

VNEB OAPF Chapter 12 S106 and Infrastructure Chapter Consultation
Representation by the Kennington Association Planning Forum.

Who we are
1 The Kennington Association is a voluntary membership association of upwards of 430 members drawn from the wider Kennington area in the north of the Borough of Lambeth, an area that abuts the Albert Embankment and Vauxhall areas of the VNEB Opportunity Area. Our aim is to promote and maintain the Kennington area as a good place to live and work, and the Kennington Association Planning Forum is a group of Association members with interest in and experience of planning and development issues, that develops planning policies and makes planning representations on behalf of the wider Association. The Association was a Rule 6 party at the 2010 public inquiry into the Bondway/Octave Tower application at Vauxhall, successfully arguing for the centrality of well-planned public spaces to the success of large, dense mixed-use developments.
2 The Kennington area comprises an interspersed mixture of Georgian and Victorian conservation areas and social housing estates, some with significant deprivation. The Association’s concerns therefore include conservation, open space, affordable housing and employment and skills issues in relation to its area, and the extent to which developments in the wider VNEB area will benefit Lambeth residents and jobseekers, or detract from public amenity.


3 The rubric to Chapter 12 enjoins those making representations not to bother repeating earlier representations about the earlier VNEB Study, which lacked a view about necessary infrastructure and its cost. In the event, there has been no sign, since we made our representation in March 2010, of any attempt at dialogue or constructive engagement on the part of GLA planners with those such as ourselves who are critical of “The Project”, and so for the record we restate our summarised conclusions of 2010, trusting that we are not wasting our remarks on closed minds and empty air.

4 Under a heading  “Summary – Whose Opportunity?” we said the following

“If these proposals go ahead, a new town of 40,000 will be created on our doorsteps over the next 15 years. That is the equivalent of the population of Welwyn Garden City deposited on Thameside from the Albert Embankment to Battersea, but without the gardens, with no civic heart and on only one sixth of Welwyn’s land.  We welcome the preparation of a framework, particularly to govern an area straddling the border of two planning authorities. We also welcome the green initiatives of the river side path and the thoroughgoing attempts to overcome the barrier effect of the railway embankment, to stitch the interior back together with the riverside zone. But we think these particular development proposals try to cram several quarts into a pint pot; in particular in our view these proposals
·         Are much too dense – approaching the highest known urban densities in the world, and exceeding those of Mumbai, Delhi and Calcutta,
·         do not allow for nearly enough open space,
·         fail to provide a civic heart or framework to the community of 40,000 they create
·         do not measure up to the challenge and expectations of the Central Activities Zone, particularly as regards the lack of any cultural component
·         appear to expect most of the supporting services like schools and doctors to be provided  by and at the expense of the neighbouring communities ,  and
·         are “supported” by a transport study which is not fit for purpose, because based on flawed “zero sum” and other assumptions

5 Having considered Chapter 12, and the October 2010 Development Infrastructure Study (DIFS) on which it draws, we can now say the following
  • the densest options for VNEB development (16,000 dwellings and 25,000 jobs) create a harsh and demographically unsustainable environment,
  • the infrastructure they demand, on present plans, would be underprovided, and where not underprovided, underpriced  - there is a heavy thumb on the scales, directing professionals to underestimate, in some cases against their better judgement
  • therefore the funding gap is not a "managable" £58m out of £1059m, but north of £500m
  • So this densest option, as regards the 16,000 dwellings target, should be withdrawn.
  • there is no commonalty of interest between
    • Vauxhall and Albert Embankment, infrastructure rich, well connected and already developing strongly under the impetus of the cluster designation (indeed “ravaged by infrastructure” as one architect recently put it), desperately needing its dreaded Gyratory to be tamed, and
    • Nine Elms and Battersea, infrastructure poor and ill connected, and needing significantly improved infrastructure.
  • And lumping them together in one “opportunity area” does not create such commonalty
  • the Northern Line Extension which takes the bulk of the funding gives minimal benefit to Lambeth, even with a station at Nine Elms, where at the suggested location of the station, the public transport accessibility level (PTAL) is already at 6 – excellent. Since DIFS tells us that the Lambeth strip next to Wandsworth Road has been removed from the OAPF, then such a station, as regards the truncated OAPF area, almost entirely benefits the Wandsworth development at Battersea Power Station, its proposed "elite" shopping, and other Wandsworth sites
  • the levying of the Lambeth part of the OAPF in aid of such an NLE is unconscionable, and arguably outside the scope of a CIL, as not necessary to the development of the Vauxhall and Albert Embankment sites
  • the long term risk is that the development proceeds, Wandsworth cherry pick the infrastructure to suit themselves, the costs overrun and Lambeth is left to pick up the pieces at its own expense, eg a secondary school and a Nine Elms Station left over to a Phase 2 that runs out of money

The DIFS Study

6 We note that DIFS concentrates on trying to work out how much infrastructure would be needed, and how you would pay for it, if you were to choose the largest and densest possible development profile for the Opportunity Area  (16,000 hoped for new dwellings and 25,000 new jobs). One sympathises with the consultant authors, who have been told by their sponsors to believe a number of implausible things, to try and make proposed levels of planning levies (S106 payments, and successors in the form of community infrastructure levy and possible specific Northern Line extension levies) cover estimated infrastructure costs. Every now and then the implausibility surfaces in footnotes where professional integrity requires that the more plausible alternatives be surfaced. In our view, the evidence is being fixed around the policy, and not the other way round - in effect there is a big thumb on the scales.

7 Turning to detail we note that
·         The Department of Transport official guidance on estimating the costs of tunneling projects (Web TAG Unit 3.5.9) recognises that known risks of uncertain scale affecting costs can properly be subject to a quantified risk analysis, while the impact of unexpected contingencies of uncertain scale -  “unknown unknowns” -  which from experience occur in major civil engineering projects at early stages, need additionally to be reflected in cost estimates by the addition of what is termed “optimism bias”, which reduces as projects develop towards delivery
·         However, almost all the contingency element has been stripped out of NLE tunnelling costs, as presented by DIFS  - an £800m estimate in the December 2009 VNEB Transport Study (at page 97), containing a 57% "optimism bias", as recommended by Web TAG for a tunnelling project estimate at this stage of development has become £563m now, including only a 5% risk premium. This does not appear to be the fully worked up itemized Quantified Risk Assessment called for by Web TAG, but an off the cuff round number.
·         Even if we give the NLE the benefit of the doubt as being at the “Conditional Approval” stage, it would still merit a 23% optimism bias, according to Web TAG. And we do not credit the idea that by means of some suitable special private sector funding vehicle, overrun risk can be completely transferred to the private sector at this cut down price – when a large infrastructure project goes wrong, it is invariably impossible for the public sector to wash their hands of its completion, and compensation negotiations with a delinquent contractor are protracted and expensive. 23% optimism bias would add £130m to the NLE cost. We note that this is a “footnote” issue for the professionals advising!
·         And we note again, as we did in March 2010, that at realistic costing the cost benefit ratio for the NLE is low, and the benefits appear to be diffused around London, both by origin and destination, with rather little seemingly accruing in the Lambeth, or indeed the OA area itself
·         targets for affordable housing have been reduced from the normal 40% to only 15%, to boost levy yield from the extra, higher priced market housing, which this relaxation permits, and reduce child yield by 25% .It is not obvious that Lambeth’s aspiration to stick with the 40% target, as regards developments within the Lambeth part of the OA, has been factored into levy yield
·         there are lowered assumptions about the proportion of inhabitants who will be elderly or young (not their sort of housing – the “client group” [mostly the developers who paid for the DIFS Study] considers that VNEB developments will have a different age profile to that of the two adjacent boroughs (DIFS para 10.18)) so you can economise on
o       health care provision (the young and elderly cost more per head, while fit young professionals cost less, so you can have a third less GP’s than the normal rule of thumb). In a separate note attached, on health issues, we note that the consultation has been perfunctory, and takes no account of the demands of visitors and an extended construction phase
o       schools - the preponderance of flats,  the mix of small and large flats assumed, and the lower %age of affordable dwellings   means that the child yield from development is only around 10% of the expected population, cf 20% for a demographically balanced population in Lambeth itself. There are not even enough children predicted, for a community of 40,000, to warrant just one secondary school – like Hamlyn after the Pied Piper!  To reach this conclusion, Wandsworth have chosen to use the lower point of an estimation range, and then knocked off a further 25% for good measure (“private education”), while Lambeth have used the midpoint of their range. If both used the midpoint, the need for a secondary school, and land to accommodate it, is obvious. Assuming conservatively that a modest 2.5 ha would suffice, this would cost £62.5m, (valuing land at the existing use value (EUV) of £25m per ha, as per the values revealed at the recent Bondway Inquiry). The build and fit out costs of such a school would be about £25m, of which £13.5m has been written into education infrastructure estimates already, assuming provision would be made outside the OA. So the costs of the necessary secondary school in the OA adds £62.5m plus £11.5m , or £74m to the infrastructure tally.
o       As regards a junior school, the study includes provision for a two form entry school in relation to the Lambeth element of the OA. We attach notes analyzing the recent developments and planning approvals in North Lambeth, their child yield and likely demand on schools, and conclude that a four form entry school is required, at a minimum extra cost of at least £25m for land alone
·         The study assumes that existing library services will suffice in north Lambeth, and suggests, perhaps tongue in cheek, that the Lambeth Archive could be displaced to Battersea Power Station. This takes no account of the real risk of closure of both Waterloo and the Durning libraries under the current review. As regards the suggestion that Lambeth cares so little for its valuable archives that it is happy to see them carted off to Battersea, perhaps the best response is “Is you having a Laugh?”
·         The study proposes to “fund” extra infrastructure required for police and fire services by denying responsibility for most of it. As the attached note comments, with the new US Embassy, the existing central London Priority Area will undoubtedly extend further into the OA, and we note that the consultation has been inadequate, undertaken with eg the shortly to be superseded MPA, but not with the Lambeth Borough Commander. The study also declines responsibility for a share of the costs of transport improvements at Vauxhall, including works to tame the Gyratory, which is now positively inhibiting development at Vauxhall, while happily accepting all the costs of the NLE .
·         and forget about normal central London quotas of green space (“the amount of open space proposed for the OA falls far short of what is needed when applying national standards” Para 19.19) - you can't get your 16,000 dwellings in if you want it green as well - revel in our linear park instead. But the linear park, which from plan in the VNEB OAPF consultation document was to be 1500m long and varied between 100m and 50m wide, would have amounted to about 11.3 ha. Now, however, it is reduced to no more than 3.5 ha, so if it is still 1500m long, it becomes on average 23m wide, not so much a linear park as a drove road. As the study says (para 14.8) “Its linear nature will mean that it will not be possible to accommodate formal outdoor sports provision and only minimal play provision along with seating areas, etc” 
·         As Lambeth’s SPD on S106 Obligations notes,
“Lambeth Open Space Deficiencies. The National Playing Field Association have a general standard of 2.4 hectares of open space per 1,000 population, Lambeth as a whole is deficient in meeting that standard, in that it has 1.54 hectares per 1,000 of population, projected to fall to 1.44. Lambeth’s Open Space Strategy recommends that a target of 1.6 hectares per 1,000 population is set for 2016.”
·         And Lambeth’s open space deficiency areas encompass the centre of Vauxhall and extend down the borough/OAPF border with Wandsworth, as the attached map shows. In this context, the comment in para 14.10 “In LB Lambeth open space provision is within a range of existing parks” is laconic to the point of being positively misleading.
·         All the options for development set out in the VNEB OAPF consultation document provided for 14 ha of public open space, while recognizing that this was way below standard. Allowing for about 2 ha of public park at Battersea Power Station, to restore even the 14 ha level (which would bring the OA up to the level of Lambeth’s worst provided ward, eg Ferndale) would require an additional 8 ha, which we price, again at EUV, at £200m.

The funding gap

8 The DIFS study asks us to believe that there is no more than a £58m gap between the £1059m cost of necessary infrastructure and the likely amount of funding, of which the lion’s share is provided by a tariff on development in the OA. At this stage the reader may wish to consult the chart attached. As we show, £62m of this infrastructure is “funded” by denying responsibility for it, including 90% of police and fire costs, and £30m of public transport improvements, half at Vauxhall. A further £63m is “funded” by hoping someone will lend it to us, even though the NLE revenue stream is negative for 60 years (operating costs always exceed revenues), and Wandsworth has ruled out prudential borrowing as burdensome to its council tax payers. This means that the realistic funding available is no more than £876m, and the gap becomes £183m. On the infrastructure side, as we have noted above, there is significant underprovision, and the NLE costs are seriously underpriced. Adding in only the NLE element (£130m), the secondary school (£74m) and the open space (£200m), we have extra costs of  £404m , and the gap becomes £588m.


9 We conclude that the consultation options that try to accommodate 16,000 dwellings in the OA will produce a harsh and demographically unsustainable development, and are unaffordable in infrastructure terms. The NLE, while advantageous to the Battersea and other Wandsworth developments is of scant benefit to the Vauxhall and Albert Embankment areas. It is set to deflect and eat up funding that could deal with the congestion at Vauxhall, and tackle the Gyratory, which divides Vauxhall, now positively inhibits development and prevents the creation of a proper heart there. It is unconscionable that Vauxhall developments should be levied in aid of the NLE while leaving its own transport problems untackled, and we shall oppose any such levy.

10 We believe that the proper response to the consultation is to conclude that the preferred option is over dense, demographically unsustainable and unaffordable and should be withdrawn. More modest options, ranging up to 12,000 dwellings should be tried instead, and cheaper transport infrastructure should be explored. We would very much welcome the opportunity to discuss these concerns and conclusions with GLA planners: having to raise them collaterally in the forthcoming Transport and Works Order Inquiry and the S106/CIL Tariff Examination will make for messy and long drawn out proceedings.

David Boardman
Kennington Association Planning Forum
25 March 2011

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