In a delegated Officer Key Decision, Newham Council approved contract variations for several affordable housing schemes, allowing for a total cost increase of £16.6 million across nine projects. The decision, made by Paul Kitson, Corporate Director of Inclusive Economy & Housing, follows a Cabinet meeting on 16 September 2025, where authority was delegated to vary budgets for JCT Design & Build¹ contracts. This decision is subject to call-in.

Affordable Homes for Newham: Updated Position

The meeting centred on an update regarding the Affordable Homes for Newham (AHfN) programme and a proposal to reset the budget for the programme to align with specific projects that have been delayed. The report noted that no additional funds were being requested, and that the total value of the realigned contingency is £22.9m across six schemes, remaining within the approved budget of £416.7m. However, the report also noted that 97 homes with planning permission were not constructed, resulting in fewer homes being delivered than initially intended when the programme was agreed in 2019.

The report recommended that the Cabinet:

• Note the update on homes that are completed, under construction or did not progress, and the challenges, successes and lessons learned of the Affordable Homes for Newham programme, together with the overall programme cost in exempt appendices.
• Agree the revised budget increases for each site to a total cost of an additional £16.6m (Appendix 2) and a further contingency allowance of £6.3m (Appendix 1).
• Delegate authority to the Corporate Director of Inclusive Economy, Housing and Culture, in consultation with the relevant Portfolio Lead, Cabinet Member for Finance and Resources, and the Cabinet member for Council Housing Improvements, to negotiate and agree contract variations with appointed suppliers as required to finalise delivery of the Affordable Homes for Newham programme.

The report detailed the achievements of the programme, noting that Newham Council had the third highest number of construction starts in London in 2022/23. As of August 2025, the programme status regarding the 2016-2022 political cycle was:

The report also provided a breakdown of the schemes pending completion in the 2018-2022 programme:

The report also detailed the achievements of the council in 2022-26, where the council's strategy has diverted to acquisitions and homes delivered through Populo Living².

The report benchmarked costs, comparing Affordable Homes for Newham team and Populo Living schemes. The benchmarking looked at key development metrics and compared them to the BCIS³ standards at that time.

The report summarised tendered construction costs across the affordable homes programme.

The report also detailed the Newham Brief , stating that:

The key benefit of the Council's own programme was the ability for it to set its own brief. It created the opportunity to address a wide range of Council policy requirements, support place making in key strategic areas on Council-owned land and used the knowledge of officers to build homes that residents needed and equally considered maintenance requirements.

The report noted that in 2019 Newham was one of the first Councils to declare a climate emergency, and its Climate delivery action plan set a clear brief for Newham-led developments, stating the council would:

Ensure that new build council homes target Passivhaus 'classic' standard, with minimum 'Low Energy Building' standard certification, as independently certified by the Passive House Institute, with the ability to reduce to the Passive House Institutes 'Low Energy Building' standard for constrained sites if necessary

The report also detailed the complexity and challenges to delivery, noting that the council has had to navigate a series of significant issues, brought about by the implementation of the UK leaving the European Union, a global pandemic, and war in Europe.

The report listed the main issues impacting the programme as:

• Build cost inflation
• Market volatility
• Delivery complexity

The report also detailed lessons learned, stating that the underlying principle to any future development programme is that the council plans slowly and builds fast.

The report noted that some of the key failings have been identified when construction contracts were awarded before on-site risks had been resolved due to the time constraints on grant funding.

The report proposed that Cabinet note the successful delivery of affordable homes and that despite the challenges faced, the Council has had the 3rd highest number of starts on site of all London Boroughs with 1,802 homes as of 2024 across Affordable Homes for Newham, Estate Regeneration and Populo Living.

The report recommended that Cabinet approve the resetting and realignment of the listed scheme budgets (below) within the agreed contingency envelope.

The report detailed the following schemes:

• Army and Navy Public House. (32 homes).
• Anne and David Street (19 homes).
• Burgoyne Depot (48 homes, 19 shared ownership 29 social rent).
• New City Road (28 homes).
• Vandome Close (55 homes).
• Morse Close (18 homes).
• Custom House (95 Homes)
• Leyes Road (116 Homes)

The report stated that the Building a Fairer Newham Corporate Plan adopted by Cabinet in September 2022 is based around a set of key principles:

• A healthier Newham and ageing well: New homes are built to adapted and adaptable standards, enabling tenants to live independently in their own homes
• Newham's inclusive economy to support you in these hard times: Low energy buildings mean lower bills.
• Your neighbourhood: Homes built on council land to support growing populations within existing communities
• Safer Newham: All homes built to high standards set through the secure by design accreditation process.
• Homes for our residents
• Supporting our young people: Larger family homes to enable children to have space to do their homework; cycle storage to facilitate sustainable transport.
• People powered Newham and widening participation: All homes co-designed with residents.
• A campaigning Council. Council officers' campaign for better grant rates from the GLA to support development where the costs of materials has increased

The report stated that the AHFN programme is a central part of the Council's approach to the housing crisis and increasing the supply of genuinely affordable housing is key to reducing the number of households in temporary accommodation across the borough, which currently stands at 7,491.

The report considered the alternative of the Council choosing not to proceed with approving budget variations, but noted that this is likely to result in legal action from contractors resulting in additional legal fees and/or suspension of the schemes.

The report noted that Mayor Rokshana Fiaz OBE, Lead Member for Inclusive Economy, Housing Delivery and Climate Emergency; and Transformation and Performance was consulted at portfolio meetings in June, July and August 2025.