A proposal for affordable housing on the Lewisham Gateway development has been criticised for not prioritising Lewisham residents and not providing housing for families.

The council has been asked to contribute £9.6 million of public money to the development, which will see only five per cent of the 106 units available at London living rent levels.

The scheme has not yet received planning permission.

With an upper limit of five of the units billed to be three-bedroom, Councillor Liz Johnston Franklin queried whether families would be attracted to the development.

Speaking at an overview and scrutiny education business panel meeting, she said: “Is there a possibility that [five per cent] can be increased, and is it possible that those flats could be on the lowest floors and not on the thirty-first floors. There is no way should a family have to live on the thirty-first floor.”

Head of planning Emma Talbot said this was something which could be explored at the plan’s next stages, but families tended to live outside town centre locations.

She said: “It doesn’t have a large number of three-bedrooms, but predominantly ones and two-beds, and that is the reason we have complimentary policies in the local plan that…restrict the ability to convert homes.”

Jeff Endean, housing strategy and programme manager, said the London living rent units would initially be marketed to Lewisham residents before being advertised London-wide.

But councillor Luke Sorba was concerned Lewisham residents were not guaranteed priority.

He said: “It is still unclear whether it’s a cast-iron guarantee they they are going to go to Lewisham residents and I must say I am not entirely clear from your answer that this will be a guarantee.”

Ms Talbot said the London living rent units cost one third of the borough’s median income.

She said: “For an example, on this scheme you might expect an average one-bed unit to rent for £1,450 per month, but an equivalent London living rent unit would rent for £879 per month.

“Along with social rented housing those are the only two products which work out as being genuinely affordable for the average earner in our borough.”

The public money will match the £10 million from the government’s Housing Infrastructure Fund.

Private developers have contributed £30 million to the scheme, which has also gone towards construction work including removing the roundabout opposite Lewisham’s railway and DLR stations.

When completed, the Lewisham Gateway will include shops, restaurants, bars and cafes, leisure facilities, up to 800 homes, Confluence Place, a park where the Ravensbourne and Quaggy rivers meet, and a town square opposite St Stephen’s Church

Ms Talbot said the second phase of development was due to go to a planning committee next week.