Boris intervenes in Elephant & Castle Ministry of Sound skyscraper battle

In October Southwark Council's planning committee voted to reject a planning application by Oakmayne for a 41-storey tower designed by Allies and Morrison to be built on the site of Eileen House on Newington Causeway.

Opposition to the tower had been led by the Ministry of Sound which claims its nightclub would be forced out of business if new homes were built in close proximity to the busy venue which has a 24-hour licence.

Weeks later the planning committee approved a smaller residential tower just across the road which was also opposed by the Ministry of Sound.

It seemed likely that Oakmayne would lodge an appeal against the council's decision, but now the Mayor of London has decided to use his power to 'take over' the application from Southwark and make a decision himself.

"This development, with potential for more than 300 flats, office and retail space, is a significant proposal that impacts on the implementation of the Mayor's London Plan," said a spokesman for Mr Johnson.

"The Mayor therefore believes there are sound planning reasons for him to take over the application and scrutinise it in more detail."

A report to the Mayor by Greater London Authority officers casts doubt on whether Oakmayne's scheme contains the maximum possible level of affordable housing.

Oakmayne proposes that 85 flats in the 329-home scheme should be made available on a shared-ownership basis.

Planning policy would expect the development to provide 129 affordable homes, split equally between flats rented by social landlords and intermediate shared-ownership homes.

The Mayor's planning officers have recommended that an independent study is carried out into the viability of the scheme.

It is the first time that the Mayor has 'taken over' an application in Southwark since the Greater London Authority was given new planning powers in 2008. The powers have only been used on four previous occasions.

Boris Johnson will preside at a public hearing in the chamber at City Hall before he announces his final decision.

"We are delighted with this decision, as we are confident that our proposals to help regenerate the Elephant & Castle align with the Government's aspirations for brownfield sites to be developed to help provide desperately needed affordable homes and jobs," said Oakmayne chairman Christopher Allen.

"We are already building 350 homes nearby, along with a five screen cinema and major new supermarket, and see no reason why Eileen House should not be able to contribute to the area's regeneration.

"The homes will be priced for ordinary Londoners, and the jobs created and our £4 million community contribution will benefit local people and services."

Lohan Presencer, chief executive of Ministry of Sound, said: "We are very surprised at this news. It seems a very unusual development.

"We have yet to speak directly today to the Mayor's office in order to better understand the detail of this latest development.

"We will comment further in due course, most likely on Monday."

Southwark Council declined to comment on the Mayor's decision to intervene.

Both developer and nightclub have been waging an expensive public relations war and making complaints and counter-complaints.

Before reaching decisions on the two schemes, councillors were presented with highly technical evidence about noise levels from the Ministry of Sound, including the findings of a report by a noise consultant engaged by the planning authority.

By the end of October Southwark Council had spent nearly £28,000 on professional advice in relation to the two Newington Causeway planning applications.

Legal fees of £1,600 had also been incurred by the council in relation to the Eileen House scheme.

The payments were revealed in response to a request made by the London SE1 website under the Freedom of Information Act.

Of the five councillors who voted that the Eileen House application be refused, three were Liberal Democrats.

Southwark Liberal Democrats have been criticised for not declaring at the committee meeting that their local party had received donations of £21,000 from the Ministry of Sound. The nightclub has also provided cash to the Lib Dems at a national level.

Last month Jonathan Bartley, Green Party candidate for Lambeth & Southwark in next year's London Assembly elections, called for the decision-making process to be rerun and for Southwark Liberal Democrats to return the cash.

"The issue here is not whether Lib Dems acted within the rules or not, or even whether you agree with the planning decision that they made," he said.

"It's about residents in Southwark having confidence that their councillors are acting in their best interests, and deciding planning applications on their merits.

"£21,000 is a huge donation for a local party to receive from one donor. The Lib Dems should return it and draw up an ethical donations policy to restore trust.

"Local people must have confidence that the decisions made by local councillors are made on the merits of individual cases, and that they are not being influenced by political donations."

Southwark Liberal Democrats say that they took advice from the borough solicitor before the planning committee meeting and were not obliged to declare the donations in the context of that meeting.