More than a thousand homes and hundreds of jobs will be lost to the people of Brighton and Hove if councillors turn down a once-in-a-generation opportunity today (Wednesday 16 November).
The warning came as councillors prepare to vote on whether to enter into a £105 million joint venture (JV) with Hyde Housing to build 1,000 homes for working people on low wages.
Hyde would put up half the money towards a scheme that is expected to have to the potential to build more than the initial target of 1,000 homes.
It will also create jobs in itself and make it easier to attract employers to the area, business leaders said, as the deal was left hanging in the balance.
Jonathan Sharrock, the chief executive of the Coast to Capital Local Enterprise Partnership, said: “The proposed joint venture between Hyde and Brighton and Hove City Council is a vital and necessary step to encourage greater inward investment into Brighton and Hove.
“More homes are needed for people across the economy in order to keep our region growing and to retain the skills and talent that our economy requires.”
Coast to Capital channels funding to major projects across the region and is a key player in helping Brighton and Hove to attract employers and government cash.
The deal was put before councillors in September but deferred during a seven-hour meeting of the council’s Housing and New Homes Committee. Councillors had dozens of questions and asked for more time. They have since been given more detail at a series of briefings by officials from the council and Hyde.
But when the council’s Audit and Standards Committee discussed strategic risks yesterday, a senior officer, Nick Hibberd, said: “There is a risk that if we don’t continually work to address housing pressures within the city and work with partners beyond the city it starts to impact on our ability to support the economy and to attract public sector workers who can afford to live and work in the city.”
This morning Hyde development director Tom Shaw said: “After eight months of due diligence and planning, all in the public eye, we look forward to the committee meeting this evening.
“The JV is a scheme Hyde proposed to the council that makes homes genuinely affordable for those on the living wage.
“No other developer has designed a scheme as innovative or efficient as this despite months and months of opportunities to do so.
“There is no silver bullet to the housing crisis facing people in Brighton and Hove and we believe that the JV is simply the right thing to do for the city.”
The managing director of Brighton and Hove Business Forum, Tony Mernagh, said: “I’d be keen to support this proposal. The situation with housing in Brighton and Hove is getting to the point of ridiculousness.
“Some say the rents shouldn’t just be affordable – they should be affordable against wages. In an ideal world that would be wonderful. A bit of reason is called for.”
Mr Mernagh added that the real answer was to increase wages although that is outside the scope of the proposed joint venture.
He also challenged those who criticised the choice of Hyde as a joint venture partner. He said: “Hyde are the only people with any ambition for affordable housing in Brighton and Hove.
“I don’t understand when housing associations became the enemy, which seems to be what some politicians are suggesting. If we’re going to be able to work with a partner, we need to trust them.”
Two of the councillors who have expressed reservations about the scheme are the former Conservative council leader Mary Mears and the Green housing spokesman David Gibson.
Councillor Mears said that she supported the council building more homes and had pushed for this to happen when she was leader.
She said that there were still many questions to answer and a lot of detail that members needed to know.
In particular she was worried about the risks to the council’s finances although the Conservative government pays a new homes bonus to councils when housing is built. The tenants will also pay not just rents but also council tax too.
Councillor Gibson is keen to see rents set at the lowest possible level, at the expense of profits. But one insider pointed out that there were strict rules about operating profitably – and, besides, the profits would be used to help build more homes or maintain existing ones.
Councillor Anne Meadows, who chairs the Housing and New Homes Committee, said: “The simple fact is that not enough new affordable homes in the city are being built, especially for rent.
“The council is working hard to build 500 affordable rented homes on sites it controls in the city. However, this is less than 3 per cent of the number that are required to be built.
“The proposed partnership will look to build 1,000 homes, with 500 low income working families and households from Brighton and Hove having the opportunity to rent a home at prices based on the national living wage.
“Without affordable rents, the reality is that people earning low incomes will have no choice but to move out of the city, leaving family, friends and their employment behind.
“On average, the joint venture would save each family housed £108 per week in rent compared to a market rent – that’s over £5,500 per family saved on rent each year.
“The rents for the new homes are substantially lower than market rents and on average over £10 per week lower than affordable rents for the council’s own new-build homes.
“The proposed homes themselves would be environmentally friendly, cheaper to heat and power and efficient on water use compared to older homes in the city.
“This would save around 40 per cent on a typical family fuel bill, adding up to even greater savings alongside the affordable rents.
“While the council seeks to make efficient and effective use of its existing council houses to meet local housing need, the reality is that the council has a long waiting list and the majority will only be housed by renting in the private sector.
“Unquestionably these 1,000 new affordable homes are urgently needed and cannot be built soon enough.”