Regeneration

Lord McKenzie of Luton Excerpts

Wednesday 27th June 2012 Lords Chamber

[Lord McKenzie of Luton]

My Lords, I, too, am grateful to the noble Lord, Lord Mawson, for initiating this short debate. I might have been even more grateful had he included Luton, and possibly Pendle, on his list of places, because it would have enabled some of us to join in the passion, advocacy and knowledge that has been displayed this evening by people in respect of the areas that they know best and that they have been involved in for many years.

The noble Baroness, Lady Howe, talked about east London and the Old Kent Road, and the involvement of faith communities in regeneration. She also touched on issues of diversity, which is something that we know quite a lot about in Luton but that perhaps has not featured as prominently as one would have thought, since it is a common feature to pretty much all the areas that we have talked about this evening. I think the noble Lord, Lord Greaves, is right to say that regeneration is not just about cities. I well recognise the problems that might be inner-city problems of resources that are not necessarily at a city level. As the noble Lord would not consider Brighton to be part of Greater London, neither would we consider Luton to be part of Greater London. However, he did touch on the issue that has been an integral part of regeneration for some time: the need to bid for resources. When there are, I believe, 371 bids for support for Mary Portas’s project but only 12 approved, that cannot be a particularly efficient way of proceeding.

The right reverend Prelate the Bishop of Birmingham —substituting in part, I think, for the right reverend Prelate the Lord Bishop of Liverpool—took us back to SRB programmes and the New Deal for Communities. I remember the New Deal for Communities in Luton; it created a furore because it could be focused only on an area of some 4,000 households. We had pockets of deprivation, and trying to work out which one got it was really quite difficult and traumatic. Nevertheless, the right reverend Prelate rightly focused on the twin engine of business and community for growth. I am pleased that the leap that he is aware of is proceeding rapidly. It has been a mixed picture across the country, as I understand it. Perhaps the noble Baroness might update us on that.

The noble Lord, Lord Storey, talked with passion and knowledge about Liverpool and the difficulties of shaking off a sometimes negative image. People will remember the riots—we had riots in Luton—which is somehow the image that is carried forward, whatever good work and regeneration are otherwise going on. Like him, we used to look at cranes in the sky as a measure of how well we were doing.

The noble Lord, Lord King, reminded us about east London and Canary Wharf, which is a fantastic development. In part it mirrors what happened in Manhattan. All the action was at Wall Street and no one thought of developing the centre until the Rockefeller Center was created, which has been hugely successful. The noble Lord made an interesting point about housing and home ownership. I partly recognise the point that he made, but I wonder whether people would be in exactly the same position now. A lot of houses have been swallowed up and have not been replaced, and young people in particular are finding it very difficult to get a house even to rent. I think that the noble Lord was right: this is about vision. That seems to be the common feature, whatever the story regarding regeneration. That featured in the contribution of my noble friend Lady Hughes, particularly in relation to Salford Quays, which was a driver for significant private sector investment in Salford. I think that the strap-line was “aspire to inspire”. A quite strong statistic is £7 of investment for every £1 of public subsidy.

The noble Lord, Lord Mawson, talked about the major change that he had seen in east London. A phoenix rising from the ashes was the expression that he used, with six and a half miles of waterway. Sadly, in Luton the River Lea stays mostly underground, but perhaps we can work on that. The noble Lord is right to say that east London has been put firmly on the map of the UK. Obviously what happens post the Olympics is going to be very important.

During the remainder of the time that I have, I should like to concentrate on the Government’s role in and approach to regeneration generally, not necessarily specifically in the areas that have been touched upon. As to what regeneration actually means, I would adopt the Select Committee’s definition of it being,

“a long term, comprehensive process which aims to tackle social, economic, physical and environmental issues in places”,

of deprivation,

“where the market has failed”.

Of course, it encompasses, but is not limited to, growing the local economy. The question posed by the noble Lord, Lord Mawson, is whether the Government have plans for a co-ordinated approach that would encompass the north-west as well as east London. As I understand it, the position is that the Government have no plans to publish a national regeneration strategy of any sort and therefore do not necessarily approach these matters in a national strategic way.

I do not propose to comment further on the detail of the specific challenges, progress, successes and disappointments of the regeneration of either east London or the north-west, because we have heard from others fantastic testimony to what has been achieved.

It is understood that the Government set their face against a national strategy because they consider that regeneration should be a matter for determination at the local level, and their role is to provide the means for local communities to do this. From what the noble Lord, Lord Storey, said, I think he would agree with that approach. We support a true localist agenda, but it does not have to be inconsistent with a national strategy. We can support many of the individual tools, flexibilities, options and powers that are being provided to local communities, although some of them are as yet untested. We will be spending time over the next few weeks examining whether the business rate retention scheme, as proposed, is an effective incentive for local authorities to promote growth. Tax increment finance is something that we have supported, although the Treasury looks to be restricting local freedoms in this regard for TIF 2. We have supported enterprise zones.

As we have heard, local leadership is vital, although the Government seem to have misread the mood in major cities in equating this with directly elected mayors. I do not think that that is a point that the noble Lord, Lord King, would necessarily agree with; he would see it as a missed opportunity.

The general power of competence for councils and the prospect of a transfer of public functions to major cities is also something that we have supported through the Localism Act. We have a shared aim of encouraging powerful and innovative cities to lead their areas. It is early days for the new planning system. Whatever the challenges, at least the regional spatial strategies provided a strategic setting. It remains very difficult to see that the duty to co-operate is a sufficiently robust alternative when it comes to those sensitive but sometimes vital planning decisions.

Anyone who has got close to regeneration projects will know of—we have heard about it this evening—the importance of community support and engagement, and the need for capacity-building. Therefore, we support the Government in continuing to seek to put the community and community groups at the heart of regeneration. This is nothing new. However, the ability of communities to respond is clearly being hampered by cuts to regeneration funding and the savage cuts to local authority budgets. The Select Committee report mentions that many of the community groups most closely involved in regeneration are uncertain about their future.

Funding will always be difficult, but it has been the speed of withdrawal that has created special problems. We have seen the demise of RDAs and the termination of the working neighbourhoods fund and the local enterprise growth initiative. It is acknowledged that there are new funding streams, but the Select Committee suggests that these—the new homes bonus, the regional growth fund and the investment in rail—are perhaps not focused primarily on regeneration.

There is concern that, by concentrating on growth and the provision of levers to facilitate this, the Government are skewing the regeneration effort and not doing enough to tackle the broader and multifaceted issues that comprise deprivation—issues that affect the north-west, east London and, indeed, all parts of the UK. Notwithstanding their commitment to localism, they should produce a national regeneration strategy that encompasses the broader issues of health inequalities, skills gaps, the prevalence of crime, worklessness and poor housing: a strategy that shares the benefits of community engagement, partnership working, local leadership and working with the private sector—indeed, a proper strategy for regeneration.