Why is the housing secretary, Robert Jenrick, at the centre of controversy over a £1bn building development?
Jenrick granted planning permission for a £1bn property scheme two weeks before the developer donated £12,000 to the Conservative party.
Jenrick and his housing department initially backed a plan by the billionaire for media tycoon Richard Desmond to construct 1,524 apartments on a site in the Isle of the Dogs, east London.
As documents released on Wednesday confirm, Jenrick knew that Desmond had only 24 hours to have the development approved before new council community charges were imposed that would have cost him about £45m. Desmond said the charge would have made the whole scheme unviable and put the accompanying social housing at risk.
Jenrick later accepted that his approval of Desmond’s project on the old Westferry Road printworks in January was unlawful.
What was the £45m charge that Desmond could have avoided?
The proposed property development was to be sited is in London’s poorest borough of London, Tower Hamlets. The £45m charge was part of the local council’s community infrastructure levy (CIL). This is a local “tax” on residential and business property developments in Tower Hamlets that the council reinvests in poorer communities, funding projects such as health clinics and educational facilities.
Why did Jenrick reverse his original decision on the development?
The housing secretary admitted that any “fair-minded and informed observer” could conclude there was a “real possibility of bias”, but he insisted he had not been biased in favour of Desmond’s project.
He then quashed his original decision and has now handed over the final say on whether the project will go ahead to another minister. The Labour mayor of Tower Hamlets and others, including a former Tory councillor, believe he did so to avoid having to release crucial documents relating to his original decision. Mayor John Biggs remarked that Jenrick’s “reluctance to disclose them speaks volumes”.
Why has the Labour party called for an inquiry into the affair?
Desmond, the former owner of the Daily and Sunday Express alongside the Star titles, has donated to the Conservatives. Desmond paid £12,000 to attend a Tory Carlton Club fundraising dinner last November at which he and other property developers sat with Jenrick.
Jenrick has admitted that he viewed a promotional video of the Isle of Dogs development on Desmond’s mobile phone at the event, but he insists he was “inadvertently” seated next to him.
Documents released on Wednesday revealed that Desmond subsequently texted Jenrick repeatedly, underlining the importance of a quick decision, because “we don’t want to give the Marxists loads of doe [sic] for nothing”.
In another newly released memo, officials in Jenrick’s department said he was “insistent that decision issued this week ie tomorrow – because next week the viability of the scheme is impacted by a change in the London CIL egime”.
Jenrick agreed to publish the documents after Labour threatened to force a vote in the Commons demanding their release, claiming there were “cash-for-favours concerns” that must be investigated.
Will there be any lasting damage to the housing secretary or the Conservative party?
One long-serving Conservative councillor in Tower Hamlets, Andrew Wood, has resigned from the Tories in protest over the affair and has called on MPs on parliament’s housing select committee to launch an investigation.
Downing Street says Boris Johnson has full confidence in Jenrick, and a string of loyal Tory MPs stood up in the Commons to defend him as a champion of housebuilding. The documents, however, raise fresh questions about his role.
The controversy has raised suspicions again over the links between big business and the Conservative party, which enjoys the largesse of multimillionaires and billionaires such as Desmond.
The Liberal Democrats have raised questions in parliament about whether the housing secretary had broken the ministerial code. The code is a set of rules and guidelines to uphold proper standards of conduct among ministers. It instructs all ministers to “declare and resolve any interests and relationships” and “take decisions impartially, fairly and on merit, using the best evidence and without discrimination or bias”.