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Sharma admits viability assessment system ‘not working’
Housing minister Alok Sharma has admitted that the under-fire affordable housing viability assessment system “is not working”.
But he told MPs on the Communities and Local Government Select Committee this morning that he favoured changing the process, rather than scrapping it altogether.
Housing charity Shelter used Freedom of Information Act requests to calculate that viability tests were used to slash 2,500 affordable homes from projects across 11 local authority areas in one year. The National Planning Policy Framework says that requirements for affordable housing should allow for “competitive returns” to a developer.
Mr Sharma said: “Clearly the system as it is does not work. We are proposing a set of improvements we believe will make it work better. Let’s see what views come forward as a result of the consultation.”
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The government published proposals in September saying that local plans should set out how developers can contribute to infrastructure and affordable housing, and that the viability of these contributions should be tested at the plan-making stage. A consultation on these suggestions closes next month.
Mr Sharma said: “If it is much clearer in local plans what the infrastructure requirements will be then potential buyers of land will behave rationally and factor that requirement in to any price they pay.”
He added: “Our view would be that abolishing [viability assessments] altogether is not the approach; making sure we look at this much earlier in the process is probably going to be the right approach.”
