The London Development Agency (LDA) is London's economic development body. It works for the Mayor with businesses and other partners to deliver economic renewal that benefits all Londoners. Established in July 2000, it is also one of the nine government-funded Regional Development Agencies in England.

  The LDA is pleased to give evidence to this inquiry and would welcome the opportunity to give further evidence at a hearing that may be organised by the Select Committee. The brief evidence that follows should be considered as complementary to evidence submitted by the Mayor of London.

KEY POINTS

—  There is strong demand for new affordable housing in London, but it is crucial that such housing is built within a wider housing and regeneration strategic framework. This must take account of the economic, social and environmental well being needs of existing and new communities.

—  The LDA believes that areas—such as the Thames Gateway—do offer an opportunity to make a significant inroad into existing and new demand for private and affordable housing in London. An important part of that challenge is delivering the 80,000 homes that there is currently estimated capacity for.

—  The sustainability of such investment will only be successful if the approach to Thames Gateway focuses on building communities, as opposed to simply building homes. Therefore local capacity must be planned for and invested in. Health, education, childcare, leisure services, as examples, are all facilities that must be planned for, as must be an effective approach to the management of new and regenerated environments.

—  The success of Thames Gateway will also rely on substantial investment in the social, economic and environmental infrastructure—particularly transport—and the success of Thames Gateway will depend much on resources beyond those available to the LDA.

—  Opportunities such as Thames Gateway should not be seen as detrimental to the needs of individual London boroughs, where housing demand is high and the need for new and regenerated mixed, balanced, sustainable communities exist.

POPULATION AND ECONOMIC GROWTH IN LONDON

  The Mayor's draft London Plan estimates the capital's population to grow by 700,000 to 8.1 million by 2016. Over the same timeframe, the draft Plan estimates the number of jobs in the capital to increase by 636,000 to 5.1 million. These two estimates present a major challenge to central government, the Greater London Authority (of which the LDA is a functional body), local authorities and other agencies with a stake in London's future prosperity.

  The need for new households to be adequately accommodated is a basic necessity for the sustained economic prosperity of London. The capital's new population will need to be adequately housed, but provision needs to be made also for those who are in current need of affordable housing.

NEW HOUSING, NEW COMMUNITIES

  According to the 2002 London Housing Statement, approximately 21,000 homes were constructed in 2000, 4,000 of which were for affordable housing purposes. The draft London Plan estimates a requirement for affordable housing, comprising the need for social rented housing and intermediate housing of 25,700 homes per annum until the estimated backlog of affordable housing is met, and 14,500 homes thereafter. This will represent a substantial increase in the amount of general needs affordable housing currently being built, with a commensurate growth of housing provided for "intermediate" purposes, ie, for key and other workers who are on low to medium level incomes. The high cost of housing is becoming a critical problem for employers who wish to recruit and retain employees.

  Clearly there is strong demand for new affordable housing, but it is crucial that such housing is built within a wider housing and regeneration strategic framework that takes account of the economic, social and environmental well being needs of existing and new communities.

THAMES GATEWAY

  The LDA believes that areas—such as the Thames Gateway—do offer an opportunity to make a significant inroad into existing and new demand for private and affordable housing in London.

  An important part of that challenge is delivering the 80,000 homes that there is currently estimated capacity for. Another important element is the expansion and regeneration of existing social, economic and environmental infrastructure, ensuring that existing as well as new communities benefit from investment. Similarly, the sustainability of such investment will only be successful if the approach to Thames Gateway focuses on building communities, as opposed to simply building homes. Therefore local capacity must be planned for and invested in. Health, education, childcare, leisure services, as examples, are all facilities that must be planned for, as must be an effective approach to the management of new and regenerated environments. Consequently, where major investment is being considered, there needs to be an evidence-based approach to existing community capacity, before more is planned.

  To help plan for sustainable housing and communities in Thames Gateway, other key factors come into play:

—  Quality design that will create attractive places to live and work

—  London's business centre from Canary Wharf and its environs must be extended eastwards

—  Industry currently located on the riverside may need to be relocated, away from Riverside locations, recycling this land for residential and mixed use purposes

—  High capacity rail and road networks that offer rapid access to central London and other areas of employment

—  High density land uses along transport spines

  Delivering the vision of a regenerated Thames Gateway will rely heavily on sustained partnership working between the Greater London Authority group, Government Office for London; the Housing Corporation; local authorities; the private and independent sectors and other stakeholders that have an interest in the success of Thames Gateway. It will also rely on substantial investment in the social, economic and environmental infrastructure—particularly transport—and the success of Thames Gateway will depend much on resources beyond those available to the LDA.

THE ROLE OF THE LONDON DEVELOPMENT AGENCY IN PLANNING FOR SUSTAINABLE HOUSING AND COMMUNITIES

  The London Development Agency is already undertaking a major role in economic and social regeneration, in partnership with others. We expect that role to expand through our organising principles of area interventions; sector strategies; and, regional priorities. This approach will be underpinned by increased resources granted to the Agency from the Spending Review 2002 and the decline in financial commitments from inherited regeneration programmes.

  Thames Gateway represents a major opportunity for London and the rest of the Greater South East. But this is one of many other strategic opportunities that the LDA and others have identified that requires attention. Opportunities such as Thames Gateway should not be seen as detrimental to the needs of individual boroughs, where housing demand is high and the need for new and regenerated mixed, balanced, sustainable communities exist.

  Overall, the LDA is committed to an enhanced housing role in the future and this is reflected in our draft Corporate Plan for 2003-06, recently the subject of an external consultation exercise. The Agency recognises that a substantial increase in the supply of affordable housing is necessary for the well being of the London economy. We will also seek added value from such investments that contribute to our four strategic priorities of promoting economic growth; knowledge and learning; diversity and inclusion; and sustainable development.