MD3063 Old Oak and Park Royal Development Corporation Supplementary Budget 2022-23

1.1.    A new HS2 station will open in Old Oak Common (OOC) in around 2030 with High Speed, Great Western Railway (GWR) and Elizabeth Line services, bringing unrivalled connectivity into one of the London Plan’s largest Opportunity Areas. This opportunity, unlocked by the major public investment in HS2, must maximise economic, housing, and regeneration outcomes doing so in a way that supports a transition to net-zero carbon economy. 
1.2.    A Strategic Outline Business Case (SOC) created by OPDC was approved in April 2022 by both the Department for Transport (DfT) and the Department for Levelling Up, Homes and Communities (DLUHC) to drive forward the opportunity around the HS2 station, in the area described as Old Oak West (OOW). 
1.3.    By using large-scale, public sector brownfield land assets at Old Oak, OOW offers the possibility to construct a new London district, on a scale comparable with King’s Cross and Canary Wharf. It will be a mixed-use residential and economic hub in west London with c.9,100 new homes, 2.5 million sq. ft of commercial space and will generate c.35,000 jobs; with direct, high-speed connectivity to central London, Heathrow, Birmingham, and other major UK cities. The full benefits can only be unlocked by providing strategic infrastructure including local station capacity upgrades, public realm enhancements, new roads, bridges, pedestrian and cycle routes, and crucially by assembling the necessary land for joined up and coordinated delivery at pace. The Old Oak West project will also catalyse wider regeneration within the Old Oak and Park Royal areas, spurring private sector investment to deliver the Opportunity Area’s overall long-term capacity of 25,500 additional new homes, and 56,500 new jobs. 
1.4.    The government and the statutory Old Oak and Park Royal Development Corporation (OPDC) are in a strong position to deliver this opportunity: 80 per cent of the developable land in the area is in public sector control (Department for Transport, via its arm’s-length bodies: High Speed 2 Ltd and Network Rail), and OPDC has planning and regeneration powers with a mandate and capability to bring regeneration forward. 
1.5.    Recent engagement with several leading private sector regeneration businesses confirms that this is an extremely attractive ‘master developer’ investment proposition, subject to the public sector assembling its land interests into a collective whole.
1.6.    OPDC is working in partnership with Homes England, DfT and DLUHC to create a jointly-owned Outline Business Case to agree how public sector land is brought together into one comprehensive scheme to deliver the benefits outlined above, and how the scheme can be delivered.  Work is now beginning to move into both the early delivery phase and the delivery of the detailed business case.
1.7.    As such, additional funding is required to ensure that a robust and detailed OBC can be created and early delivery can be scoped. It is proposed that this grant is drawn-down by OPDC to support this work programme, and that the Mayor’s Chief of Staff, Executive Director of Resources and Assistant Director Group Finance & Performance are consulted on this draw-down as part of the regular monitoring and reporting cycle.
 

2.1.    The additional funding will support the delivery of OPDC’s strategy for OOW, which is designed to realise the new homes, jobs and wider regeneration benefits set out above. It will support the promotion of economic development and wealth creation, social development and the improvement of the environment within the OPDC area.  

3.1.    Under section 149 of the Equality Act 2010 (the “Equality Act”), as a public authority, the GLA must have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and victimisation, and to advance equality of opportunity and foster good relations between people who share a protected characteristic and those who do not. Protected characteristics under the Equality Act comprise age, disability, gender re-assignment, pregnancy and maternity, race, religion or belief, sex, sexual orientation and marriage or civil partnership status.  
3.2.    When considering the needs of the existing community and those that will be affected by the proposals for the redevelopment of Old Oak West, any resulting development activity will seek to minimise disadvantages to all protected characteristic groups. An equalities impact assessment will be carried out for any proposed developments and will also be part of the OBC. 
3.3.    This decision is not expected to have any negative impact on persons with a protected characteristic under the Equality Act. 
 

Key risks and issues 
4.1.    The key risk of not providing additional funding is highlighted in the table below:

Links to Mayoral strategies and priorities
4.2.    The table below highlights links to key Mayoral strategies and priorities:

Impact assessment and consultations 
4.3.    Homes England, other housing professionals in the GLA Group (including LLDC, TfL and the GLA’s Housing and Land Team) have all contributed to a review of OPDC’s proposals and have agreed to collaborate to ensure efficiencies wherever possible.
 

5.1.    Supplementary grant funding for OPDC of up to £1m in 2022-23 will be funded from the GLA’s MDC Reserve. If approved this will increase OPDC’s 2022-23 Budget to £7.8m. 
5.2.    The GLA will pay OPDC a revenue grant, as this income source can be applied as necessary to finance capital expenditure where appropriate.
5.3.    Funding for OPDC’s future year budgets will be approved as part of the 2023-24 budget setting process.
 

6.1.    Under section 121(1) of the GLA Act the GLA can make grants towards meeting revenue expenditure (i.e, expenditure other than capital expenditure) incurred or to be incurred by OPDC for the purposes of, or in connection with, the discharge of the functions of that body. The activities to be supported by the proposed £1m grant all fall within the OPDC’s objects and powers under section 201 of the Localism Act 2011.  
6.2.    Under section 121(3) of the GLA Act a revenue grant must not be made subject to any limitation in respect of the expenditure which it may be applied towards meeting, except  that the expenditure must be revenue expenditure.  
 

7.1.    OPDC has set out in its management plan four key steps to delivering its Old Oak West Strategy.  These steps and the next steps to deliver them are set out below.