Councillors criticised a decision to allow a developer to provide no affordable flats on a housing scheme – despite an earlier expectation it would do so.

The decision – which will instead allow the developer to pay a sum of money towards affordable homes elsewhere – led one Labour councillor to claim it marked “the end of getting any affordable housing provision through planning”.

In 2019, property developer Avi Dodi won permission to convert part of seven-storey Britannia House in High Road, North Finchley, into 23 flats.

Planning officers recommended five of the flats would be classed as affordable, after Colliers International – the council’s independent viability adviser – said this could be supported by the scheme.

But Mr Dodi challenged the viability assessment, and a new one was carried out. Colliers reviewed this and judged the scheme “generates a surplus of approximately £165,000”.

As Colliers said this would only be enough to provide “one or two” affordable homes on site, planning officers recommended the money be spent on other affordable housing schemes.

This is subject to a “review mechanism”, meaning the contribution towards affordable homes could change at a later date.

At a meeting of Finchley and Golders Green area planning committee on Wednesday (June 10), a planning officer said that since the previous application was approved, there had been a “reduction in values for flat developments in Barnet” and a “significant increase in the costs of construction”, meaning the viability of the scheme had “further reduced”.

The developer’s agent, Joe Henry, told the meeting that market conditions had since deteriorated even further due to the Covid-19 crisis.

But Cllr Alan Schneiderman (Labour, Woodside) asked why the report said the development would make a deficit even if it provided no affordable housing.

Mr Henry said viability tended to mean a certain “percentage return” – usually ranging between around 17 to 20 per cent – for banks to judge that the risk of financing a development is appropriate.

Cllr Schneiderman (Labour, Woodhouse) said: “If this is allowed to go through as it is – 23 units in North Finchley town centre, with the equivalent of no affordable housing – then we are basically seeing the end of getting any affordable housing provision through planning applications. I think that is a very poor precedent we are setting here, given the state of housing need in the borough.”

But Cllr Shimon Ryde (Conservative, Childs Hill) said: “Cllr Schneiderman’s supposition is completely invalid.

“The supposition is that, as a result of the current economic circumstances, land values will fall and therefore appraisals will be made on a different basis.

“The issue here is, we do want to see schemes built out, because it is not only affordable housing that is important, it is producing units within the borough.

“Future appraisals will be based on what happens in the future.”

Cllr Danny Rich (Labour, West Finchley) said: “It seems to me we get these applications time and time again, and there really is no effort to balance the needs of those who require social housing with the needs of the other people we want to attract into the borough.

“If developers knew we were going to be tougher, they would find a better way of providing the affordable housing that we also need in this borough. We need to have mixed housing in this borough – at the moment, we are not getting that.”

When it came to the vote, three Conservative members were in support and three Labour members were against. Committee chairman Cllr Eva Greenspan (Conservative, Finchley Church End) used her casting vote to approve the scheme.