The developer behind the Morrisons store in Sittingbourne has denied accusations of “blackmail” after the scheme’s affordable housing targets were slashed by 89%.

Essential Land was given permission to build the supermarket on Mill Way if it signed a section-106 agreement in which local authorities give planning permission in return for developer contributions.

These usually include cash towards schools, roads, arts and housing, but the company said at a previous meeting the agreement was “burdensome”.

It argued its affordable housing provision for the nearby homes development should be cut from 30% to 10%, the promised £215,000 towards heritage schemes be dependent on housing profits, and any payments, except for a schools contribution be removed altogether.

At a public meeting last month, councillors agreed to renegotiate the 106 agreement after Essential Land reduced its profit margin from 20% to 15% and planning officers warned the company could withdraw its offer completely.

Essential Land will now have to make just 3.3% of the homes built affordable.

Chalkwell ward Cllr Ghlin Whelan (Lab) said: “This type of blackmail does not sit comfortably. Let’s hope this is not a template for the regeneration for the whole town centre.

“We need this site redeveloped as it looks like a bomb site at the moment.”

Cllr Whelan was rebuked by chair of the meeting Cllr Richard Barnicott for using the word “blackmail”.

However, his anger was echoed by other members who agreed it was important the building went ahead.

Cllr Mike Henderson (Ind) argued that forcing the developer to raise the affordable housing provision to 10% would jeopardise the £474,000 that had been promised to Kent County Council for education.

He said: “The fact is this is a major housing application and there needs to be education provided in Sittingbourne as the population expands.”

Martin Bellinger, chief operating officer of Essential Land, said an independent viability assessment had shown the original agreement was not viable.

“Planning officers provided options to councillors on which proposals could get money,” he said.

“Essential Land did not present them with any options.

“There was and is no question of any form of blackmail - a proper process has been followed.”