Greenwich Council has paid less than half of its contribution to Woolwich’s new Crossrail station – and needs to find £8 million by the end of March 2023 to pay the bill.
The shortfall means that money from developers earmarked for infrastructure across the borough – such as transport, health and education – may now be diverted to make up the remaining costs.
Woolwich station had been due to open with the rest of the Elizabeth Line three years ago today, but is now expected to open between February and June, and a frequent service of test trains is running through the station.
When plans for Crossrail were first drawn up in the 2000s, the line was due to pass under Woolwich without stopping, with the government claiming a stop would not be good value.
While the basic infrastructure was put in place, the station was only fitted out after Greenwich Council and Berkeley Homes, the developer of the Royal Arsenal, struck a £54 million deal with the government and TfL in 2013. Greenwich’s contribution was £15 million, to be paid back through money from developers.
Chris Roberts, the leader of Greenwich Council at the time, said that the station would come at “no cost to our local council tax payers”.
But Greenwich has raised less from developers than anticipated – raising the prospect that money meant for projects in other parts of the borough will have to be diverted to the station, which is due to open next year.
The full details of the agreement to fund the station were not made public at the time. City Hall contributed an extra £5 million, TfL agreed to contribute fare revenue, but Berkeley’s contribution was never clarified.
About 40 per cent of all payments under what was then a new system – the Community Infrastructure Levy (CIL) – were used to fund the station, along with the proceeds from a Section 106 “roof tax” on developments in the Woolwich area.
But together, only £6.9 million has been raised – leaving just over £8 million to find over the next 16 months.
The figures have come to light in a new document to be put before the council’s cabinet next Wednesday, the Infrastructure Funding Statement. Since last year councils have been required to publicly account for what they receive from developers and how they spend it.
CIL rates are set by councils and are then assessed by a planning inspector.
While Greenwich’s rates are low compared with other boroughs – one possible explanation for the lack of cash for Woolwich Crossrail – the planning inspector intervened in 2015 to set a even lower rate in Plumstead, Abbey Wood and Thamesmead because of fears that a higher charge would deter developers. There is also a Mayoral CIL, which goes to City Hall and funds Crossrail and the proposed Crossrail 2.
“There has been a decline in the amount of CIL collected in Greenwich over the last two years due to a reduction in reported commencements and the value of these commencements,” the statement says, adding that many of the borough’s biggest developments, such as Kidbrooke Village, predate the CIL system so do not need to pay into it. Including “affordable” housing also means developers can get relief from CIL payments, reducing receipts even further.
The council is now likely to have to use more CIL money, officially earmarked for infrastructure elsewhere, to make up the shortfall.
By law, CIL payments made to councils are split two ways. In Greenwich, a 15 per cent portion is allocated to “neighbourhood CIL”, which goes towards the Greenwich Neighbourhood Growth Fund grants for local projects. This proportion is less than in neighbouring boroughs such as Lewisham.
Most of the remainder goes to “strategic CIL” – cash for boroughwide projects, half of which has been allocated to Woolwich Crossrail.
Nearly all the other half remains unspent, except for topping up the Greenwich Neighbourhood Growth Fund and a £300,000 contribution to a digital connectivity strategy. But the rest now seems set to make up the shortfall for Woolwich Crossrail, despite it officially being meant to be for other projects elsewhere – including education, health, waste, transport, open spaces and public realm – leaving Greenwich worse off than its neighbouring boroughs.
“At this time there are no plans to spend the available Strategic CIL, with these funds being held to cover the outstanding commitment to contribute £15m towards the fit out of the Woolwich Crossrail Station by 2022/23 through Borough CIL receipts,” the statement says.
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