Communities secretary Hazel Blears has ordered a public inquiry into P&O's proposals for three tall buildings in York Road next to Waterloo Station.
The news that Ms Blears has "called in" the planning application follows the decision of the Mayor of London not to use his power to block the controversial scheme designed by Southwark-based architects Allies and Morrison.
P&O wants to replace Elizabeth House on York Road with three buildings ranging in height from 20 to 33 storeys which would create nearly 4,000 jobs and 274 homes. Lambeth councillors approved the scheme in August.
The proposals are consistent with planning policy to create clusters of tall buildings at transport interchanges, but as the buildings will be visible from Parliament Square they may fall foul of measures designed to protect London's world heritage sites.
The secretary of state has asked the inquiry to consider a range of matters including "the appropriateness of tall buildings in this location", whether the scheme complies with policies designed to protect conservation areas in Lambeth and the Westminster world heritage site from damaging development.
Both English Heritage and Westminster City Council oppose the York Road proposals.
The Waterloo public inquiry will be the latest in a series of costly and time-consuming hearings into proposed high-rise developments along the South Bank.
For the latest local news and events direct to your inbox every Monday, you need our weekly email newsletter SE1 Direct.
7,000+ locals read it every week. Can you afford to miss out?
Read the latest issue before signing up