Brierfield and Nelson (Regeneration)

Wednesday 11th September 2013 Westminster Hall

16:30

[Andrew Stephenson (Pendle) (Con)]

It is a pleasure to serve under your chairmanship, Mr Gray. It is also a pleasure that my right hon. Friend the Minister will respond to the debate, because he is one of the few Ministers whom I have yet to lobby directly on this issue. His colleague in the Department for Communities and Local Government, the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Great Yarmouth (Brandon Lewis), accepted my invitation to visit Pendle back in November 2012, as did his other DCLG colleague, the Minister for Housing, my hon. Friend the Member for Hertford and Stortford (Mr Prisk), in June this year. My right hon. Friend is welcome to visit Pendle any time.

I am grateful for the opportunity to initiate this debate on regeneration in Brierfield and Nelson. First, I will set out the background for the debate and outline some of the successes that we have had to date. Then I will address some of the challenges that we still face in the area: empty homes, Brierfield mill and assisted area status.

The towns of Brierfield and Nelson contain some of the most deprived wards within Pendle. There are regeneration challenges in other parts of Pendle, such as in the town of Colne, where I live. However, the problems in Brierfield and Nelson are the most acute in the area and are therefore the focus of the debate.

Pendle is ranked the 41st most deprived local authority in England out of 326, and both Brierfield and Nelson have wards that rank in the top 200 most deprived wards in the country. The percentage of people in Pendle who have never worked stands at 8.33%, which is above the nationwide average of 5.61%. However, the percentage in Brierfield is significantly above the percentage in Pendle—with nearly 15% of people in Brierfield having never worked—and in some wards in Nelson, such as Bradley, the percentage is 17%, and the percentage in Whitefield is 25%. That translates into very high numbers of people claiming out-of-work benefits and low educational attainment and aspiration.

That situation contrasts sharply with the growth opportunities in the borough. Pendle as a whole has one of the highest proportions of people engaged in manufacturing of any part of the country. About 27% of Pendle jobs are still in manufacturing, compared with a national rate of just 10%. Pendle employers include companies in a dynamic aerospace sector, such as Rolls-Royce, as well as companies in the nuclear supply chain, such as Graham Engineering. Pendle has a large number of the fastest growing companies in Lancashire and the wider north-west, and they are powering growth opportunities in the area. The Prime Minister visited one such company, Hope Technology, earlier this year.

Those companies received a significant boost in July, when the Government agreed with the arguments that I and others were making and approved £5 million in additional business support, via the regional growth fund, to help our local mid-sized manufacturers to expand. That should help to create more than 500 new jobs, safeguard a further 250 jobs and bring more than £20 million of private sector investment into the area. Since 2010, we have also seen the number of apprenticeships in Pendle double, while unemployment has fallen significantly. The latest unemployment figures, published this morning, show that the unemployment rate in Pendle is now just 4.3%, which is well below the national average.

In addition, significant investment has been made and programmes undertaken by the council and central Government that have helped to boost the area. The reopening of Manchester road to traffic through Nelson town centre in 2011, along with associated street scene improvements, has given the town a genuine boost, as has the Government’s decision to designate Nelson in May 2012 as one of the first 12 Portas pilot towns in the country. That saw Nelson receive £100,000 to try new schemes to attempt to bring people back into the town centre, and even led to a visit from the retail guru Mary Portas herself. Crucially, that cash was in addition to £100,000 that Pendle received via the high street innovation fund. For young people in Nelson, a new state-of-the-art youth zone on Leeds road was opened by my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) in October 2011, in his then role as Children’s Minister.

Pendle council has invested £1.2 million in two new sports pavilions in the area: one at Bullholme in Barrowford and one at Edge End in Nelson. In August, the area secured £150,000 of funding from Sport England for the new Steven Burke Sports Hub, named after the gold medal-winning cyclist from the town of Colne. Added to contributions from other sources, £308,000 will now be invested in the area around Swinden playing fields in Nelson, to create a cycle track and to improve sporting facilities. Plans to expand the role of Pendle community hospital—investment for which was secured by the last Conservative MP for Pendle, for facilities that ideally would be located in Nelson town centre—are also progressing well. Nelson has benefited from Heritage Lottery Fund money to restore the old library on Booth street and to improve Marsden park. Also, the long-standing problem of a lack of primary school places has finally been addressed by the decision to build two brand new schools—Whitefield infants school, where I am a school governor, and St Paul’s primary school—at a combined cost of £14.1 million.

Similar big investments can be seen in the smaller town of Brierfield, with the Lob Lane mill redevelopment providing new homes on a major derelict site. My hon. Friend the Minister for Housing was able to visit that site earlier this year. The library also benefited from a £500,000 face-lift in 2012, thanks to the then Conservative-led county council. Brierfield is also home to Pendle’s first primary academy. Walter Street primary school, a school in special measures that had continually failed to improve, has become an academy and is now called Pendle primary academy. Although we are still in the very early days of this transition, after working with the outstanding Nelson and Colne college the school’s results in June showed a significant improvement in reading, writing and maths.

A huge amount of investment and positive change is clearly being made under the current Government, but I will now turn to some of the challenges that we still face in the area. Empty homes remain a real problem in Pendle. The Minister will recall the Westminster Hall debate that he responded to in July, which I also attended, when the hon. Member for Hyndburn (Graham Jones) set out some of the challenges that he faced in his constituency. Many of the root causes of the problems in Brierfield and Nelson are very similar to those in Hyndburn and other parts of east Lancashire. However, in Pendle a combination of factors and the hard work of Pendle borough council, which is jointly run by the Conservatives and Liberal Democrats, have led to some genuine progress during the past three years. The number of empty homes in the borough has fallen from 1,847 in 2010 to 1,414 in July this year—a reduction of almost a quarter, and I expect the number to be even lower by the end of this year.

We now have the lowest number of empty homes in the area for some time, and that significant reduction—made under this Government—is very welcome. However, things are in danger of stalling. The largest provider of social housing in Pendle is the Together Housing Group, which is spending more than £10 million to bring 300 empty homes across Pennine Lancashire back into use, by offering a purchase and repair option and a lease and repair option. More than £3 million of that investment has come from the Government, via the Homes and Communities Agency, and it could have huge benefits for the towns of Brierfield and Nelson. To comply with the HCA’s funding guidelines, the Together Housing Group is required to register a lease with the Land Registry. However, where a property has a mortgage against it, a housing association requires the consent of the lender to register the title. This is a big stumbling block, as lenders are refusing to do that simply because the scheme does not comply with the standard buy-to-let terms and conditions. Despite attempts to open dialogue with lenders, the Together Housing Group is still being refused by them repeatedly.

I wrote to my hon. Friend the Minister for Housing about this issue recently, and I would appreciate it if my right hon. Friend the Minister could address this challenge in his response to the debate. Sadly, without a resolution, much of the money will remain unspent and many of the 300 empty homes that I have mentioned will remain boarded up.

I will now turn to Brierfield mill. The Government gave Pendle council a £1.5 million grant, via the HCA, to buy Brierfield mill in March 2012. Formerly, it was the home of a major local employer, Smith and Nephew. Under the previous Government, this building complex was bought by a Birmingham-based Islamic charity, which had planned to convert the site into a 5,000-place girls boarding school. The scale of that project would have been disproportionate to the rest of the local area; there would have been more people in the school than in the town of Brierfield itself. Now in public ownership, this employment site, which covers 400,000 square feet and is located next to the M65 motorway and Brierfield railway station, has the potential to be a key driver of jobs and growth. The project offers the opportunity to provide more than 500 jobs in a mixed-use development, comprising work spaces and enterprise areas in leisure, a possible hotel development and residential uses. However, bringing this major grade II listed building back into use in such a deprived part of the borough will require some public funding, in addition to private sector investment.

In June, my hon. Friend the Minister for Housing kindly accepted my invitation to visit Brierfield mill. I have also met another DCLG Minister, Baroness Hanham, to discuss the council’s European regional development fund bid. Pendle council submitted an ERDF funding bid to the DCLG for a managed workspace scheme with a total cost of some £3 million. The bid was for approximately £1.5 million of ERDF to be matched by £1.5 million from the council’s joint venture company with the private sector, which is called Pearl2. However, when assessing the bid the Department raised concerns about procurement and state aid rules, and there have been long negotiations over the past few months. Although officials have been helpful, it looks as though the bid will need to be scaled back to meet those requirements, so much so that continuing with the bid appears not to be viable. I would appreciate the Minister committing to look into the council’s ERDF bid and providing any assistance that he can.

Another equally tricky issue relating to Brierfield mill is securing funding to acquire and improve land at either side of the site to make it more attractive to private sector investors. A key part of that would be a new access road into the site from the M65, which the architects and council believe to be critical to the project’s success. Although that would probably cost in the region of £1.5 million, it would help unlock the site’s potential and draw interest from private sector investors and be a sensible use of taxpayers’ money. Sadly, in his response to Pendle council on 20 August, the Minister for Housing said that all the funding streams that could help to pay for it are fully committed. Again, I would appreciate any thoughts the Minister has on how we could progress the issue. There are barriers in freeing up these grant opportunities for Brierfield mill, and I simply ask the Minister to assist where he can.

Pendle council’s submission to the current consultation put forward four wards to be granted assisted area status: Brierfield ward, the Bradley ward of Nelson and the neighbouring wards of Old Laund Booth and Barrowford, which contain high rates of manufacturing jobs. The proposed wards are all within the M65 corridor, which is highlighted in the Pennine Lancashire investment plan as a key economic growth corridor. The corridor has the potential to generate around 15,000 new jobs and 2,300 new houses. Concentrating assisted area status along that growth corridor, which runs through Brierfield and Nelson, will help to boost regeneration and growth.

The council believes that assisted area status will provide significant opportunities for business growth and development, which will act as a catalyst in bringing high-quality jobs to the deprived areas within the wards and the wider deprived areas of Pendle. There are further eligible wards in Pendle, but the council considers that those four have the greatest potential to utilise the benefits of assisted area status, which will have a positive impact on the local economy and assist with regeneration. I appreciate that assisted area status and the consultation is a matter for Business, Innovation and Skills Ministers, but I urge the Minister to join me in lobbying them on Pendle’s behalf, as a positive outcome would have significant positive effects on regeneration and growth.

In conclusion, I am greatly encouraged by much of what has been achieved by the coalition Government over recent years, particularly at a time of very tight public finances. In Brierfield and Nelson, most of the credit for that lies with the current leader of Pendle borough council, Councillor Joe Cooney, his predecessor Councillor Mike Blomeley and the excellent officers at the council. Rather than simply throwing money at problems, the local authorities and other bodies have had to work innovatively to deliver positive outcomes. However, there is clearly still significant potential for growth in Pendle, and I hope that the Minister can support our area’s ambitions.

16:43

[The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Don Foster)]

It is a great pleasure to serve under your chairmanship, Mr Gray. I congratulate my hon. Friend the Member for Pendle (Andrew Stephenson) on securing the debate, on the forceful way he has drawn the Government’s attention to the concerns in his area and on his success in his lobbying endeavours to date. I understand the challenges that he has raised and I will address them as best I can.

Before I do that, however, I thought it would be helpful to put into context the Government’s work to help areas such as Pendle drive forward better growth and regeneration. We are firmly of the view that local leaders are best placed to understand their local economies and the needs of their areas, and that is why, as we have developed our policies, we have done all we can to reform the system, putting the levers and incentives in the hands of local leaders and local communities. It is also why we have established local enterprise partnerships, bringing business and local authority leaders together. We have also established enterprise zones, worked with the major conurbations through the city deal programme and introduced a £750 million Growing Places fund at the local enterprise partnership level.

We have supported small businesses through the small business rate relief scheme and decentralised control over resources, for example by removing many of the ring fences on local authority budgets. We have rewarded places that deliver growth through, for example, the new homes bonus and the business rate retention scheme. We recognise in doing that how important regeneration sites such as Brierfield mill and Nelson are to Pendle’s local economy.

I am delighted that I will be added to my hon. Friend’s long list of Ministers within the Department for Communities and Local Government whom he has lobbied on these issues. He referred to his lobbying of the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Great Yarmouth (Brandon Lewis); the visit that he had from the Minister for Housing, my hon. Friend the Member for Hertford and Stortford (Mr Prisk); and the conversations that he has had with my noble Friend Baroness Hanham. As a result of that lobbying, and that of the excellent local council of my hon. Friend the Member for Pendle, we have already seen some real successes, which bear repetition. As he rightly said, he has secured £100,000 for the development of Nelson high street as part of the Portas pilots, and he described to us the excellent use to which those funds are being put. A further £100,000 has come from the high street innovation fund to provide yet more help in areas with the highest empty property rates.

Pendle has also received two thirds of a million pounds of new homes bonus money, which has already been put to excellent use in helping first-time buyers obtain mortgages by providing guarantees. Pendle has received £2.3 million of direct funding to bring 227 empty homes back into use by March 2015, as my hon. Friend said. Perhaps most significantly in the context of this debate, Pendle has already received £1.58 million of funding from the Government through the Homes and Communities Agency to buy Brierfield mill, securing the site for development when it might otherwise have been sold off for piecemeal developments. I must also refer to his successful lobbying of the Government that led to the announcement of £5 million of business support through the regional growth fund.

As my hon. Friend rightly said, there are still a number of challenges, with much to do and problems to be overcome. I must point out that there is no hidden pot of cash that I can dip into to help solve some of those problems. As he has already been told by my hon. Friends in the Department, the funding streams are already fully committed, but that does not mean that we cannot provide further assistance in some form. I particularly encourage him to ensure that his local council is working as closely as it can with the Lancashire local enterprise partnership.

My hon. Friend referred to the bid for assisted area status. He has rightly said that if that is granted, it will make the area eligible to receive regional aid, typically in the form of capital investment in business. I am pleased to hear that the council is working actively to take up the opportunity of applying for assisted area status for four wards in his area. He is well aware that we are at an early stage of the process. Stage 1 of the consultation phase closes on 30 September. Returns from that first phase will inform the development of a draft assisted areas map, which will be drawn up by the Department for Business, Innovation and Skills for stage 2 of the consultation in the winter. Following ministerial agreement, the map will then be submitted to the European Commission for clearance before coming into effect on 1 July 2014.

Although there is still a way to go, I seriously urge the council to work closely with the local enterprise partnership, because the LEPs, with their clear strategic overview of their area’s economic priorities, will influence decisions on assisted area status significantly. It is crucial that Pendle influences the LEP’s thinking. By raising the issue so publicly today, my hon. Friend has already helped the cause, for which I congratulate him.

I am particularly concerned to hear about some of the problems being faced in relation to the empty homes programme, which my hon. Friend has rightly highlighted. We have provided £235 million of direct funding to help local authorities, housing associations and community groups address the most problematic empty homes, which would not otherwise be brought back into use. As he rightly says, Pendle has received £2.3 million of that funding to bring 227 empty homes back into use by March 2015. The council and registered providers are working incredibly hard to address those empty homes, as the reduction in the number of empty homes in Pendle is already proving. They have already had great success, but as he has pointed out, there is a complication in the case he describes: many successful empty homes schemes are predicated on councils and other providers leasing the empty homes from their owners, which has increased the number of private sector leasing schemes such as the LinkedUp empty homes scheme operated by Together Housing Group.

Having recently been made aware of the particular challenge that my hon. Friend describes, the officials in my Department are already seeking a solution. Our attention has also been drawn to that challenge by the Empty Homes Network. It transpires that some mortgage lenders are not agreeing to their borrowers entering into the lease arrangements on which the empty homes programme is based, which I find incredibly surprising because such private sector leasing schemes will not only provide a regular rental income for the owners to help them repay their mortgage but improve the value and condition of the asset. Derelict properties sitting on the asset books of mortgage companies are a problem not only for the mortgage company but for the local community. Such properties become a magnet for rats and squatters, driving other local residents away.

I hope mortgage lenders will look at the scheme rather more favourably that they have to date. To try to achieve that, my officials have been working closely with the Empty Homes Network and the Council of Mortgage Lenders to highlight to lenders the real benefits of entering the scheme. I am pleased to tell my hon. Friend that the Council of Mortgage Lenders is now engaging directly and closely with us on that issue, and we hope to persuade it to support the programme and persuade its members to engage much more actively in it. Those discussions are ongoing, and I cannot say that there has been a positive outcome, but successful discussions are taking place. Additionally, the Empty Homes Network is now going to produce a guide designed to help lenders and providers find suitable solutions to the problem. I am pleased that we are making some progress, and I congratulate my hon. Friend on his work to ensure that the issue is being addressed in the way that it is.

I am also aware of the discussions that have taken place between the borough council, the Homes and Communities Agency and my Department on the further development issues around Brierfield mill. We will continue to do all we can while bearing in mind that there is no hidden pot of cash that I can find. My hon. Friend particularly referred to the European regional development fund bid related to the mill, on which there have been difficult procurement and state aid issues. Following those discussions, we have ring-fenced the ERDF funds for the project, and we are now awaiting a further application from the council. Provided the application addresses the issues in the way that we have advised, I am reasonably confident that we will be able to approve the bid.

On the link road, there are no funds available within the Department to assist my hon. Friend. I am sure he will be active in lobbying other Departments, and I am sure that my right hon. and hon. Friends in the Department for Transport will now be looking forward to having further discussions with him.

I congratulate my hon. Friend on the work he and his council have done in making huge strides on the regeneration of the area. He has made an important contribution to that work, and I thank him for continuing to raise the issue, for bringing the problems to us and for ensuring that we are working collectively for the benefit of the people who live in his constituency.

Question put and agreed to.

16:55

Sitting adjourned.