Crossrail charge could make Waterloo and Elephant regeneration "unviable"

Last year the Mayor of London announced his intention to vary the London Plan to enable him to insist that developers building office blocks in the central activities zone (CAZ) pay a contribution towards the cost of the east-west railway line via the section 106 (planning gain) agreement.

Boris Johnson hopes to raise £300 million for Crossrail via a levy on additional office space above a 5,000 square foot threshold in the central activities zone and the northern Isle of Dogs.

The CAZ incorporates much of north Southwark and north Lambeth (including Elephant & Castle) although neither borough will be served directly by Crossrail.

The Mayor has refused to bow to cross-party calls for the Elephant & Castle to be excluded from the charging zone, although he has agreed to exempt the Vauxhall, Nine Elms and Battersea area from the levy.

The examination-in-public of the proposed alterations to the London Plan is taking place at City Hall this week, and Lambeth Council, Southwark Council, the Waterloo Community Development Group and the South Bank Employers' Group have lined up to give evidence against the Mayor's proposals on the grounds that they will harm regeneration plans for SE1.

The Greater London Authority insists that north Southwark and north Lambeth will benefit from Crossrail because it will reduce congestion on existing tube lines including the Jubilee and Bakerloo.

"While Crossrail will make a substantial contribution to the whole UK economy, London will benefit most and therefore it is right that we pay our fair share of the costs, says Boris Johnson. "In particular, it is fair that developers whose buildings will add to congestion should contribute towards this project, which will make the largest dent on the problem."

The GLA's Andrew Barry-Purcell spoke about the "very severe problems of congestion" on the Jubilee line and explained that it "perfectly right" that any further office development in the London Bridge and Waterloo areas should contribute towards Crossrail.

He also said that Boris Johnson has deemed Crossrail to have the highest priority amongst transport projects in London. "He therefore thinks that it is a higher priority than Waterloo," said Mr Barry-Purcell, who added that the GLA is pressing Network Rail to fund the works required at Waterloo.

"We have argued for the entire south London area to be removed from this for a number of reasons," said Michael Ball, director of the Waterloo Community Development Group. "One of which is simply clarity and legibility. It is easy to understand that everything south of the Thames shouldn't be part of this."

Mr Ball explained that post-war plans for Waterloo to become an office overspill area for the City and West End never really took off despite being "phenomenally well-served" by public transport. With significant exceptions such as County Hall and the Shell Centre, major employers hadn't moved to the area.

"Waterloo is in the situation now where we have major office sites that are being converted to hotels – there are four on site at the moment and we have 17 in the pipeline. We are in danger of losing the identity of the area as a major office area."

He added that the redevelopment of Waterloo Station "is critical for any major office development. The city growth strategy identifies 300,000 square metres of growth around the station that requires the station to be rebuilt, which will require massive funding from developments." Mr Ball said that he "couldn't follow the logic" of requiring Waterloo developers to pay for Crossrail when such large-scale investment was required south of the river.

"Nothing that I have seen demonstrates that development in the Waterloo area will have a direct impact on the need for Crossrail," said Lambeth Council's Zbig Blonski.

He also pointed out that whereas the Mayor had agreed to exempt Vauxhall, Nine Elms and Battersea from the Crossrail charge where a £600 million development is proposed, Waterloo requires investment of £1.5 billion.

Ted Inman, chief executive of South Bank Employers' Group, explained that the Waterloo area has more than half the jobs in the whole borough of Lambeth and had been identified as an area for 15,000 new jobs in the London Plan.

"We are very unhappy about anything that will make more difficult the prospect of further development and [affect] the balance between tourism, culture, offices and residential which is what makes the area special."

Mr Inman also said that SBEG's own survey showed that fewer than 10 per cent of people currently working in Waterloo live in areas that will be served by Crossrail.

He added that the plans to extend all the platforms at Waterloo Station to take 12-car trains would represent the equivalent expansion in capacity to adding all of King's Cross station's passengers to Waterloo's existing users.

Simon Bevan from Southwark Council told the hearing that Elephant & Castle's designation as part of the central activities zone reflected an aspiration rather than an established fact.

He said that the planned regeneration of the Elephant and the construction of new homes will "very quickly bring about the failure of the [tube] station requiring the construction of new escalators" at a cost of £200 million.

"With that sort of level of investment needed (or currently under discussion) the impact of the charge for Crossrail becomes quite unrealistic."

In its written statement submitted in advance of the hearing, Southwark Council said: "The imposition of a Crossrail charge would serve to undermine the business case for the [Elephant & Castle] regeneration project even further, and would remove funding for the delivery of a key piece of transport infrastructure which is required to enable the project.

"In addition to rendering the regeneration of the Elephant & Castle unviable, the Crossrail charge is likely to stifle all of the office development planned for the Elephant and Castle. While the Elephant & Castle is not seen as becoming a significantly more important office location than it already is, some expansion of office employment is needed to reinforce the area as a sustainable, mixed area."