Comfortable victory gives way to questions over how the new mayor’s policies will hit construction and whether delivery is at risk.
If Sadiq Khan was expecting an easy ride during his first few weeks as London’s new mayor, the response from the construction and infrastructure industry to his appointment suggests it’s going to be a short-lived honeymoon.
The new man at City Hall may have cruised to a comfortable victory in last week’s mayoral race, but the policies that won him so much popular support – technically, he has a larger personal mandate than any other individual in British political history – are already being dissected.
Generic_Housing homes London
Before the campaign took something of a nasty turn in its final weeks, it had been assumed that the key election battleground in the capital would be housing.
One of Mr Khan’s headline-grabbing, pre-election pledges was that half of all new housing in London should be affordable.
As Construction News reported in February, the prospect of tighter controls on what type of schemes get the green light from the new mayor has had some developers scrambling to get planning applications over the line before last week’s polling day.
“As has been observed by others, 50 per cent of nothing is nothing, and this is a particularly pertinent issue for small developers”
Brian Berry, FMB
Federation of Master Builders chief executive Brian Berry is not alone in observing that a 50 per cent target for affordable housing “is entirely unworkable”, especially if “affordable” is taken to mean sub-market rent or shared ownership housing.
Rather cannily, however, the new Labour mayor has left himself more than a little wiggle room by not defining what he means by affordable.
Mr Khan’s target is better read as an indicator that addressing the housing crisis on the supply rather than demand side is his priority. But to do this, he must not make onerous demands of small developers, Mr Berry says.
“Placing unrealistic affordable housing demands on small sites will leave thousands of projects across the city unviable and hugely increase the barriers to growth of smaller developers.
“As has been observed by others, 50 per cent of nothing is nothing, and this is a particularly pertinent issue for small developers.”
London Underground Metropolitan tube line train
On transport – the eternal voter winner in the capital – the most eye-catching of Mr Khan’s manifesto promises was to freeze fares throughout his first term.
The problem is that such a well-meaning plan does not come during a time of plenty at Transport for London. The government is phasing out its £700m annual subsidy as investment in certain areas of the network becomes increasingly critical.
Sources at TfL admit there is nervousness about the freeze, which the mayor hopes can be paid for through efficiency savings, not all of which have been spelt out.
“It will mean getting rid of people, merging some functions, changing working practices, [and] all of these have scope to generate tension”
David Leam, London First
Turner & Townsend’s UK infrastructure head Patricia Moore says handling public transport will be “one of Mr Khan’s most delicate balancing acts”.
“He has set himself an almost impossible challenge: to raise the funds needed to pay for vital upgrades through efficiency savings alone,” she adds.
According to Ms Moore, TfL now faces “a tough choice between asking for more public money or delaying improvement works”.
London First infrastructure director David Leam is slightly more optimistic about the mayor’s ability to balance the books, but says there will be challenges in delivering his promises, with possible job cuts among them.
“There is a lot that can be done in terms of efficiencies,” he insists. “What will it mean in practice? It will mean getting rid of people, merging some functions, changing working practices, [and] all of these have scope to generate tension.”
More on Sadiq Khan
Heathrow third runway and Gatwick second runway CGIs
The Airports Commission was supposed to take politics out of the decision on London’s air capacity expansion, but following months of delays and obfuscation, few now take that claim seriously.
And so the election of a London mayor who has publicly opposed the building of a third runway at Heathrow should not be taken lightly.
“There is now a real risk of the runway debate going back to square one,” says Aecom chief executive Patrick Flaherty. “The damage this would do to the economy and the UK’s competitive standing would be irreversible for several generations. London cannot afford further political procrastination.”
“It is important his views are listened to and any concerns are addressed, but ultimately it is a decision for government”
Gavin Hayes, Let Britain Fly
Ms Moore echoes the point, saying Mr Khan’s favouring of a second runway at Gatwick “sets him on a collision course with the Airports Commission”.
But Let Britain Fly campaign director Gavin Hayes is more relaxed about the former transport minister’s influence.
“Sadiq Khan is not the decision-maker, he can’t take the expansion debate back to square one. He is an important stakeholder and it is important his views are listened to and any concerns are addressed, but ultimately it is a decision for government.
“He obviously has some concerns around environmental impact, particularly around aircraft noise and pollution, but I believe these concerns can be addressed.”
Whatever influence Mr Khan has on the government’s thinking on Gatwick and Heathrow when it makes its decision later this summer, his election could help the planned expansion of City Airport see the light of day.
“In terms of City Airport expansion, Mr Khan’s appointment can only be a positive thing,” Mr Hayes continues.
“It will take at least 10 years for a new runway to be built [at Gatwick or Heathrow] and within that time it is crucial that we make the most of the airport capacity we already have, and an expanded City Airport could be part of this.”