Q71 Jim Sheridan: So the provision of affordable housing will be guaranteed?
Dame Mavis McDonald: Yes.
Mr Walker: Yes, it is actually a requirement of the planning permission, so there is no way that it is going to move away from that.
Q72 Jim Sheridan: Should the housing market take a nosedive, what effect would that have on these plans?
Dame Mavis McDonald: If the housing market took a very fast, short-term nosedive, because of the length of the roll out we do not expect it to affect the total returns on the scheme. Our evidence in the office over time is you can track blips in the market but there is a steady, constant trend, and we have real evidence of shortage of housing-not just affordable housing but a range of private sector housing in London as well.
Q73 Jim Sheridan: Will that affordable housing be for key workers and key workers only?
Dame Mavis McDonald: A mixture of social rented, housing for key workers, other low cost home ownership schemes and whatever the partners want to bring forward at the time.
Chairman: Thank you. Mr Jenkins.
Q74 Mr Jenkins: Coming later on, a lot of the questions were asked that I formulated in my mind. But I want to go back on some of the answers at this stage because I am not really sure in my own mind now what the purpose was. We said it and you said it in writing, English Partnerships have been cautious in not assuming a share of profits from activities within the Dome.
Q75 Mr Jenkins: So you have no share of profits from activities within the Dome, so effectively the Dome has no commercial value to us and we have given it away; yes?
Mr Walker: Sorry, no, we do share in the profits from the Dome. English Partnerships has a profit share in the activities that take place within the Dome after the Dome operator takes a prior return. After that we share 15% of any profits that are generated within the Dome itself.
Q76 Mr Jenkins: What figure do you put on that?
Mr Walker: We did not take into account any figures on profit in the calculations now in presenting our report. We actually did not include any because at the time it was very difficult to estimate what sort of profit there would be. So in reaching the decision on the transaction we did not include any profits from the Arena, which is what we are talking about, or indeed from what we call the Dome Waterfront, which is the area surrounding the Arena that is in the Dome itself.
Q77 Mr Jenkins: So you did not assume any profits?
Mr Walker: We did not assume any profits.
Q78 Mr Jenkins: So it would be right for me to assume that since you did not assume any profits there was no profit?
Dame Mavis McDonald: No, I think what Mr Walker is saying is that for the purposes of all the current due diligence and the cost benefit appraisals we needed to do on the MDL deal we did not add in estimated profits from the Dome, but they are part of the legal agreement. So to the extent that they materialised they are a bonus on top of our expectations that we have already.
Q79 MrJenkins: An unquantified bonus that may or may not come to fruition?
Dame Mavis McDonald: We anticipate that it should come to fruition but the NPV of the deal does not stand or fall on it.
Q80 Mr Jenkins: All we have is the figures you have given us to work on, and if you put no figures in we have a right to assume that there are no figure coming forward; yes? Or is that unreasonable?
Dame Mavis McDonald: I think we shall have figures in due course but it would not be right to say that there is no arrangement to retrieve a share of the profits from the operation of the Dome; that is part of the joint venture deal with the MDL Consortium.