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Safe as houses?

June 22nd, 2020

Housing has long had a special place in the Tory party’s heart. A “property owning democracy” in Mrs Thatcher’s vision. It has also proved a nightmare as the rises in interest rates, negative equity and repossessions in the 1990’s showed. Now the problem is different: people desperate to own a home (the young) are shut out by sky high prices (at least in some places), the difficulties of saving for a deposit while renting and the lack of sufficient affordable homes. The interests of existing homeowners, a sometimes impenetrable and lengthy planning system, the effects of QE inflating asset prices, the attraction of property as an “investment” for those from less secure countries and inertia have combined to make the Tories’ cherished property-owning democracy more of a chimera than it once seemed.

This has not been helped by the number of Ministers dealing with this: 18 junior Ministers between 1997 – 2018. Only in January 2018 was Housing moved to the Ministry of Housing, Communities and Local Government and given a Cabinet Minister. There have been three: Sajid Javid (for 3 months), James Brokenshire and now Robert Jenrick.

Aged 38, Jenrick has acquired an extensive property portfolio of his own: two properties in London and a Grade 1 listed property in Herefordshire, bought the year after he qualified as a solicitor when he was 27 at a cost, apparently, of £1.1 million. Which of these doubtless lovely homes is his main home caused him a bit of bother earlier this year when he seemed unclear about the lockdown rules. No matter. They were all very complicated. Casting stones when even those closer to the PM were confused was never going to happen.

Now he has got himself into more bother about some other housing, specifically, the Westferry development in Tower Hamlets, 1500 luxury homes proposed by Northern & Shell, owned by Richard Desmond, owner of a newspaper empire, including the Express and, once, other rather more salacious titles.

The basic facts are these:

  1. Tower Hamlets failed to make a decision on the planning application within the prescribed period. This was for double the number of houses in the original application, initially approved by Boris’s deputy mayor for planning, Edward Lister (now a No. 10 strategic advisor), in 2016. In June 2019 the developers reduced the amount of “affordable housing” from 35% to 21%.
  2. In summer 2019 the Minister “called in” the application ie meaning the Ministry would decide not the local authority.
  3. It is normally a senior civil servant who decides such applications. Ministers do so only for the most high profile or controversial decisions. Whoever does it, they act in a quasi-judicial capacity.
  4. There was a planning inquiry in September 2019. The Planning Inspector ruled against the scheme on the grounds that it was not in keeping with the area’s character and the lack of affordable housing.
  5. On 14 January 2020 Jenrick overruled the Planning Inspector’s recommendation, granting permission. This occurred the day before there was to be a Community Infrastructure Levy to be paid by the developer to the local council, a sum of £40 million. Jenrick also accepted the reduction in the affordable housing, estimated by some to save a further £106 million.
  6. It’s not known why Jenrick made his decision because a judicial review was sought. Rather than fight it, the Minister conceded he acted unlawfully and that the timing “could lead the fair-minded and informed observer to conclude that there was a real possibility of bias”. He agreed that his decision should be quashed and decided again by another Minister in the department. Note that this statement only refers to the timing of the decision as being the reason for the appearance of bias, not the Minister apparently being privately lobbied some two months earlier by the developer.

It is relatively unusual for a Minister to concede so readily. Government lawyers will have reviewed the files and advised. What can there have been in them leading to such a rapid reversal? (Note that the government lawyers will likely not have known of or taken account of the facts which have since come out relating to the Minister’s extra-curricular jollies.) There must have been enough in there for advice to be given that this was not an action to be fought before the courts. Someone wanted not to expose the Minister’s decision-making to the beady eyes of a judge or the lawyers advising the local authority or the Mayor.

We have since learnt more. According to the Sunday Times:-

  • Last November Jenrick was at a Tory party fund-raising dinner and sat a table with him were Richard Desmond and 4 other senior managers involved with the development. What a coincidence! Did whoever did the seating plan not ask a few questions about the appropriateness of this, given that the Minister was already involved and would shortly be considering the outcome of the planning inquiry held two months earlier?
  • Did the Minister not wonder about this too? Or do Ministers turn up at these fund-raising dinners with no knowledge of who is attending?
  • According to what Jenrick told the Commons, having first sent a junior Minister in to bat for him when questions were first raised, his officials were aware (when?) that he had “inadvertently” found himself next to Mr Desmond. Maybe it was inadvertent. But were his officials aware of the 4 other people involved with the development also “inadvertently” sat there? Why did he not mention this to the Commons?
  • He stated he had been clear that he could not discuss the application when Mr Desmond raised it. That too is a bit economical with the actualité. According to Mr Desmond, Jenrick watched a promotional video about it on Mr Desmond’s phone.
  • A fortnight after Jenrick granted planning permission Mr Desmond gave £12,000 to the Tory party, his first donation since 2017. He says this had nothing to do with the approval but was simply payment for the November dinner. Awfully good of the Tory party to wait so long for payment.

There are lots of questions to be asked about this matter. But three big obvious questions arise.

(1) Why did Jenrick, a lawyer and the Minister who had called in the application, allow Mr Desmond to say anything at all about the proposal – let alone show him a film of it, however short, however bland – at that dinner? As soon as he saw who was at his table, he should have made it clear that there could be no discussion about this at all. It would have been even wiser for him to have moved to another table.

(2) Why did he think he could continue making the decision after that dinner? He may genuinely have not been influenced by it. He may genuinely have thought he had no bias. But as he himself put it when agreeing to cancel his decision, it is the “appearance” or “possibility” of bias which is critical. That existed after that dinner. And not just because of the timing of the decision before the additional levy became due, as stated when the decision was withdrawn.

If his officials knew about the full circumstances (Did they? When?) of that dinner, how could he possibly have been properly advised that it was appropriate for him to continue being involved? He should have recused himself then to avoid even the merest hint that he might have been, even unconsciously, influenced.

(3) Why did he not make full disclosure of all these facts to the Commons when first asked – rather than sending his junior Minister to answer questions – or then giving carefully drafted but less than fully transparent responses?

Perhaps answers to these and the other questions arising (were there, for instance, any contacts prior to or around the time the application was called in?) will be given in response in the debate this Wednesday called for by Labour?

But there is a wider issue here. The Tories have made much of their claim to be speaking for the left behind, the ignored, the unfashionable, those too long taken for granted, to be the party that will level them up. It is what got them their 80-seat majority. It is a song which, Covid-19 notwithstanding, they hope the voters will still be humming at the next election.

But this story and the way it has so far been handled introduces some discordant and familiar notes: of arrogance, a refusal to be transparent, a failure to follow the law, of possible sleaze, a willingness to favour rich donors, of treating affordable housing – so important to so many – as something to be traded away. It risks playing into a perception that some Tories think the rules are for the little people only.

Perhaps it would now be wise for Jenrick to spend a bit more time in his many houses. Meanwhile, pity the poor Minister who has been given this hospital pass.

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