Honiton developers says deferral of affordable house contributions helps safeguard workers
PUBLISHED: 08:00 24 July 2020
The developers behind the Hayne Lane housing project has said protecting workers’ jobs was the main reason behind asking to defer affordable housing payments.
Initial planning approval for the 300-house residential development was granted in February 2015 with a section 106 agreement in place.
This agreement would have seen the developers pay £500,000 towards affordable housing this year as well as a £381,980 contribution to education and £105,000 contribution to a sports pitch next year.
At the start of the month, the Herald reported that Baker Estates had asked to defer payments for affordable housing and the developers have now clarified the reasons behind the decision.
Graham Hutton, Baker Estates development director, said: “During the pandemic we have taken all the necessary steps to ensure our workforce is protected.
“One of those steps is to follow the government advice of working with the local authority to defer the payment of financial planning obligations. That is all that we are doing.
“Deferral will have the benefit of allowing us to continue to build at a faster pace than would otherwise be possible.
“As a result, more trades will return to full operation sooner and more affordable housing will be delivered quicker.
“The monies outstanding will then be paid in full to the local authority as intended. These measures help to mitigate some of the Covid-19 impact such as the fact that it now takes considerably longer to build a home. The government advice for local authorities to favourably consider S106 & CIL (community infrastructure levy) deferrals was published May 13.
A spokesperson for the developers added: “The deferral of payment means that jobs are safeguarded because we retain the funds necessary to continue construction.
“Building homes under Covid-secure measures takes considerably longer and a greater investment is required until we receive any income.
“The government advice to defer payments is part of their package of measures (along with the furlough scheme, business interruption loans etc) to ensure businesses have sufficient cashflow to continue building.
“Without it we would have to reduce the amount we are building which would impact the volume of work for our subcontractors.”
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