Newham Council has agreed to increase the budget for the construction of two affordable housing developments by a total of £3.7 million. The developments at Bramall Close and Idmiston Road will provide 73 new homes at social rent levels. The decision was made necessary by unforeseen costs related to fire safety improvements and the discovery of asbestos.

Bramall Close and Idmiston Road Affordable Housing Developments

The meeting focused on the need to approve budget increases for the two affordable housing developments at Bramall Close and Idmiston Road. These developments will provide 73 new homes at social rent levels¹, addressing the pressing need for affordable housing in the borough.

The original contract for the developments, agreed in July 2021, was for £30.6 million. However, unforeseen circumstances have led to significant cost increases.

The estimated final costs for the schemes are now £32.5m for Bramall Close and £10.8m for Idmiston Road.

This represents a combined increase of £3.7 million.

The majority of the cost increase (£2.8 million) is attributed to fire safety improvements. These improvements go beyond those initially specified in the contract and are necessary to comply with the latest fire safety regulations and guidance, including those stemming from the Grenfell Tower fire.

In addition, the discovery of asbestos at the Bramall Close site has added a further £0.7 million to the costs. The report notes that these costs could not have been anticipated:

The presence of asbestos-containing materials (ACMs) at Bramall Close was confirmed during intrusive surveys.

These unforeseen circumstances have created a funding gap in the budget for the developments, necessitating the requested budget increase.

The report argued that the budget increases represented good value for money despite the unforeseen costs. The report cited the urgent need for affordable housing in the borough as justification for the additional expenditure.

Failure to approve the requested budget variations is likely to result in significant delays to the delivery of the schemes.

This delay would not only impact the 73 families in need of affordable housing, but also result in wasted expenditure. The council has already spent £13.2 million on the Bramall Close development and £3.4 million on the Idmiston Road development. Any delays would likely result in increased costs due to inflation and the need to potentially re-tender elements of the works.

The decision to increase the budget was made in line with the council’s commitment to providing affordable housing and its statutory duty to ensure the safety of its residents.