Camden Council has denied accusations it is “profiteering off million pound penthouses” and going against its own policy on affordable housing after controversy over a West Hampstead development resurfaced this week.

The row over Liddell Road – a council-led project that would expand Kingsgate Primary School and build 100 new homes – was seized on by the president of the Liberal Democrat Party during a visit to the area on Tuesday.

Tim Farron MP joined his party’s prospective parliamentary candidate for Hampstead and Kilburn, Maajid Nawaz, in a walkabout along West End Lane.

The pair slammed the Labour-led council for wanting to build a “hugely unpopular” 11-storey residential tower block and allowing developers to provide just four per cent affordable housing.

They also attacked the council for making £3million profit out of the scheme – a surplus the council says it will reinvest in repairing schools elsewhere in the borough.

Mr Farron said: “Four per cent affordable housing is pathetic – we would ask for at least 30 per cent.

“The council seems intent on building houses local workers and families can’t afford. It’s hard enough to find space to build housing that when you choose not to include a sizeable level of affordable housing, it’s pretty dreadful.

“Unless politicians get a grip on the housing crisis, businesses won’t be able to attract workers, children won’t have a stable decent home and you will have to be a millionaire to live in London.

“We are facing a backlog of over a million homes that Labour didn’t build (nationally) – and their plans to build 200,000 homes won’t see house prices drop because demand will still outstrip supply.

“We need 300,000 a year and specific investment in truly affordable homes.”

Mr Nawaz added: “Labour should be the sort of party that is concerned about this, but they’re not.

“I know from my own personal experience the difficulties created by the current housing market – I’m forced to rent in Camden because I couldn’t afford a house here.

“What’s shocking is that when young families are struggling to get on the housing ladder, the Labour council in Camden is busy profiteering off million pound penthouses, instead of providing enough homes.”

A planing application for the Liddell Road project is expected to be lodged in the coming weeks.

The arrival of Mr Farron in West Hampstead sees his party try to show their commitment to regaining lost ground in the area in the run-up to the 2015 general election.

In May’s local elections, a disastrous night saw all three of their longstanding West Hampstead councillors replaced by three Labour representatives.

Cllr Theo Blackwell, cabinet member for finance, dismissed their claims over Liddell Road as “completely wrong”, saying: “All the £3million raised goes into repairing schools across the borough – a budget that has suffered £200million of cuts.

“West Hampstead is not its own estate and it has previously had its schools repaired from the fund.”

The council has previously said the low percentage of affordable housing is “necessary” to fund the expansion of Kingsgate Primary School.