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Housing secretary Robert Jenrick is facing calls to resign after documents revealed he was “insistent” a controversial development was agreed before a new levy would cost its Tory donor backer millions.
The move also prevented one of the poorest boroughs in the country, Tower Hamlets, receiving tens of millions of pounds.
Boris Johnson has backed the beleaguered minister and said he considers the matter “closed”, according to the head of the civil service, Sir Mark Sedwill.
‘We don’t want to give the Marxists doe [sic]’
A text from Desmond, the former owner of the Daily Express, to Jenrick read: “We have to get the approval before January 15 otherwise payment of 45 million pounds to Tower Hamlets meaning we have to stop and reduce social housing.”
In one text, Desmond wrote: “Good news finally the inspectors reports have gone to you today, we appreciate the speed as we don’t want to give Marxists loads of doe [sic] for nothing!”
He added: "We all want to go with the scheme and the social housing we have proposed and spent a month at the Marxist town hall debating, thanks again, all my best Richard."
The levy of £45m would have been due as part of the new community infrastructure levy (CIL), that would have improved local facilities in the deprived borough of Tower Hamlets.
However, Jenrick approved the development plan shortly before the charge came into place on 15 January – overruling both Tower Hamlets Council and a planning inspector.
Lib Dem MP Sarah Olney said the most damning element of Jenrick’s decision was his willingness to deprive such a poor borough of tens of millions of pounds.
The most important fact in the #Westferry saga for me is that Tower Hamlets Council - one of the poorest boroughs in the country - were deprived of £40m - £40m! - at a stroke of Jenrick’s pen. They’re currently projecting a deficit of £10m due to Covid-related costs.
— Sarah Olney (@sarahjolney1) June 24, 2020
Tower Hamlets is among the top 32 poorest boroughs in England, and it is thought 40 neighbourhoods in the area are in the top 20% most deprived areas.
A Housing Ministry official indicated the secretary of state (SoS) “insisted” Westferry to be signed off and approved the following day so that it would avoid the CIL.
It stated: "On timing, my understanding is that SoS is/was insistent that decision issued this week ie tomorrow - as next week the viability of the scheme is impacted by a change in the London CIL regime."
Desmond personally gave the Conservative Party £12,000 two weeks after the scheme for 1,500 homes was approved.
Councillors asked the High Court to intervene and force the government to disclose all correspondence concerning the development. Instead of doing this, Jenrick has been forced to quash his own approval, conceding the decision was “unlawful”.
The correspondence comes as it was predicted that more than eight out of 10 councils in England that provide adult social care services are at risk of bankruptcy because of the financial risks of coronavirus.
Analysis from the Centre for Progressive Policy think tank found that authorities in the most deprived areas of England face higher costs related to the pandemic than what has been provided by the government.
Jenrick is now facing calls to resign over the controversy – but Boris Johnson backed the beleaguered minister with the head of the civil service saying the prime minister "considered the matter closed”.
Labour shadow housing minister Mike Amesbury told the BBC: "The interesting statement from Richard Desmond that 'didn't want to give the Marxists dough', for no reason, almost whatsoever… well, actually what that would have given is potentially schools, GP surgeries, and very, very importantly, much needed affordable housing in one of the poorest communities in certainly the country.”
In Commons exchanges on Wednesday, Jenrick accused Labour of making "wild accusations" and "outrageous" claims.
He said the accusations made against him were "not simply wrong but actually outrageous", although he admitted "things could and should have been done differently”.
Business minister Nadhim Zahawi said the documents published on Wednesday proved there was no overt influence by Desmond.
The business minister told the BBC: “The access did not buy this billionaire a decision.
“The secretary of state very clearly said to Richard Desmond ‘I can’t see you, I can’t have this meeting’. You have to also be fair and make that clear.
“Yes, of course there was access, because there was a dinner party that Robert Jenrick didn’t know he was going to sit next to Richard Desmond at, but Robert Jenrick also said in those messages, that he released after promising the select committee he would release them, ‘I can’t have this meeting with you’.”
Lord Bob Kerslake, a former head of the Civil Service, said the relationship between Jenrick and Desmond raised questions about the planning process. “I don’t for a moment suggest the minister took his decision simply because of a donation to the Conservative Party.
“But the fact is, for the price of a dinner, the developer was able to present his scheme to the minister, follow up with texts and seek to influence the decision.”
Yahoo News UK has contacted Jenrick and Desmond’s offices for comment.