Housing: Spending Review

Lord Greaves Excerpts

Thursday 4th November 2010 Lords Chamber

[Lord Greaves]

My Lords, I start by declaring my interest as an elected member of Pendle Borough Council and thanking the noble Baroness, Lady Hollis, for introducing this extremely important debate at this time. I do not want to talk about the issues that she mainly talked about, although other members of the Liberal Democrat party will do so later. However, I have considerable sympathy with many of the things that she said. We are in the middle of a consultation debate on these matters and I hope that the Government may amend some of the proposals before they are finally put to Parliament for agreement.

I will talk about local regeneration, particularly housing regeneration, and the prospect facing many local authorities—particularly shire districts in more deprived and disadvantaged areas—of the removal of virtually all their capital investment resources. This will mean that they will find it extremely difficult to carry out housing regeneration work. The RDAs, which have provided considerable investment in regeneration, are going. The so-called regional housing pots, which replaced the capital allocations to councils, are disappearing. Grant Shapps, the Housing Minister, has announced that the housing market renewal programme is being done away with. I want to talk specifically about the housing market renewal programme because this is where the problems will be most acute. I speak from five years’ experience—to last May—as the executive cabinet member of Pendle Borough Council for our housing market renewal projects.

The scheme was introduced in 2003 in nine main areas, including Hull and the East Riding, NewcastleGateshead, Oldham and Rochdale, and East Lancashire, where I live. It has resulted in a substantial investment in the regeneration of areas of old housing and low-priced housing. The amount of money that has been spent in the areas this year is some £364 million. The scheme, if one believes the circular that Grant Shapps has sent round, appears to be closing down, although it is not clear whether there will be transitional arrangements next year. That is the first question that I want to ask.

It is being suggested, as it was in the White Paper Local Growth: Realising Every Place’s Potential, that there will be some funding available via the regional growth fund, but this is only £1.4 billion over three years and the amount of money that is available to the housing market renewal areas to wind up their schemes is not known. That is my second question: to what extent will that fund be available? It is suggested that the Homes and Communities Agency may help to contribute to these schemes but, again, it is all very vague.

The housing market renewal schemes were set up as 15-year programmes. They are just over halfway through; I think we are in year eight now. They were based on local master plans—programmes for neighbourhoods, working closely with residents. There is much of what some people might call the big society going on in those areas, which it appears will all be closed down. As somebody who has been closely involved in them, I am the first to admit—in fact, I am the first to criticise—that they have been bureaucratic in how they have carried out their work. They have wasted a lot of money: in East Lancashire £3 million a year has been spent simply on administration, research and schemes by the so-called partnership Elevate, which was set up to co-ordinate and run the schemes, rather than this being done directly through local authorities that knew what they were doing. The way in which it happened was a typical new Labour way, which wasted a lot of money. Nevertheless, there are schemes taking place now that are halfway through. The Government say they will honour committed schemes. My third question is: what are committed schemes? Are they those that have contracts at the moment, or are they the schemes for neighbourhoods that might have been partly bought up by the council, partly pulled down and partly boarded up? Are such neighbourhoods simply to be abandoned now?

There are regeneration schemes under HMR in all the areas, where derelict factories and mills have been bought. They may have been cleared. Remedial work is needed on the land before private developers will come in and find it profitable. Because these are, by definition, areas of low housing prices, gap funding is often needed to make the schemes profitable. The private sector will come in and build but it will not do so if it is not going to make a profit, so all these things require funding from the public purse—there is no other way in which they can be done. They have been done, and promised, through the housing market renewal programme. If this is coming to an end, are we to be left, as I said, with streets which are half boarded up and half purchased by the council, where the council no longer has the money to buy the rest of the houses—there is such a street in my own ward, and there are much bigger similar areas in other places—or are brownfield sites which have been bought up for redevelopment to regenerate and create new life in these areas now to be abandoned as the remediation cannot be afforded because the gap funding is not there? These are the kind of problems we are dealing with.

The Whip is looking at me to indicate that my time is up, and he is quite right, but I will say one more thing. Are we to be able to complete the schemes in a satisfactory way or are they to be abandoned and all we are going to be able to do is to fulfil existing contracts? This is a very serious matter. I do not expect the Minister to have all the answers to it today but perhaps she can provide them to me and the House in writing.