Regeneration

Debate between Simon Danczuk and Bob Blackman

Thursday 19th April 2012 Westminster Hall

[Simon Danczuk (Rochdale) (Lab)]

I am pleased that we are having a debate on regeneration. Since I have been in Parliament—I readily admit that I have been here only since May 2010, which is not long—there has been little discussion of regeneration, which is something of a surprise.

As a member of the Select Committee, I want to start by thanking those who gave us evidence. I also thank the Committee staff, and particularly Kevin Maddison, the Committee specialist, who worked on the report and our evidence taking. We could not have been better supported.

I want to focus on the Government’s document “Regeneration to enable growth”, primarily because it is a missed opportunity. The Minister, giving evidence to the Committee, said that he was very proud of it. My view—and I have had nearly 20 years’ experience in social and economic regeneration of one kind or another—is that it is the most unimaginative document to come out of Government that I have ever managed to read. I say that because it could have done much more. I know that the Government’s defence is localism, and that they do not want to be prescriptive, and I understand that. However, the document could still have provided some direction, and suggested approaches for regeneration. It could have reviewed good and bad practice and set some broad priorities for people to follow locally. Unfortunately it does little of that. It suggests a laissez-faire approach to regeneration and gives the impression that the Government do not care.

It is reasonable to say that I am not the only person who was disappointed with the document. Professionals from the sector, who gave evidence to the Select Committee, described it as “thin, weak and disappointing” and “The Emperor’s New Clothes”. One witness described it as “vacuous” and another said it was not worthy of a junior member of staff; so regeneration professionals are also disappointed—it is not just me. I readily accept that, as the hon. Member for Northampton South (Mr Binley) said, people do not talk about regeneration when we are out knocking on doors. When we knock on doors in deprived neighbourhoods, in areas that need regeneration, often they do not use that term; but they know that their area needs dramatic improvement. My point is that if those residents were to read the document, they would undoubtedly be as disappointed as the regeneration professionals who gave evidence to the Committee.

Something else that gives the impression that the Government do not care is the money that they have dedicated to regeneration. The figures are set out in the Select Committee report. In 2009-10 Government spending on regeneration was £11.2 billion; in 2010-11 it fell to just under £8 billion; and the estimate for 2011-12 is just £3.9 billion. I readily accept that cuts need to be made, but that is a phenomenal reduction in support for communities that are struggling. However, there are two other problems with that limited amount of money being spent on regeneration. First, it includes public expenditure that has nothing to do with regeneration. My hon. Friend the Member for Sheffield South East (Mr Betts) made the point about high-speed rail. We cannot include all public expenditure and describe it as regeneration spending. That is unrealistic, and I suspect that that is what the Government are attempting to do. The other issue that my hon. Friend mentioned is the regional growth fund. Lord Heseltine came to the Committee and clearly said that the RGF has nothing whatsoever to do with regeneration. Yet the RGF is counted as regeneration money in the £3.8 billion.

Just to help with the debate that happened earlier, about housing and the regional growth fund, I and other hon. Members attended a briefing with Lord Heseltine and the Minister of State, Department for Business, Innovation and Skills, the hon. Member for Hertford and Stortford (Mr Prisk), about round 3 of RGF. I asked Lord Heseltine whether bids should be made in relation to housing. He made it clear that housing is not included in RGF, and that people bidding in round 3 should not bother putting in a housing element.

The key issue has been discussed already—I think this is helpful with regard to definitions—that in relation to RGF and other initiatives the Government are confusing things. There is a need to stimulate economic growth—I fully agree with that—but that is economic development, not regeneration. I am all in favour of economic development and stimulating economic growth, but it is not the same as regenerating communities and areas where there has been market failure. So the £3.9 billion is not only a limited amount, it is not actually being spent on regeneration.

That is compounded by the second problem with the regeneration budget, which is the fact that it includes the new homes bonus budget. The reality is that, as we know, a good proportion of the new homes bonus will go to wealthy areas, where there is no market failure. Yet that money is being counted in the regeneration budget. If, as we all agree, there are limited resources for the Government to use, we should expect them to direct those resources to the areas of greatest need. However, they have not done that. The regeneration budget of £3.8 billion or £3.9 billion, the high street innovation fund, for which I know the Minister is responsible, public health money for primary care trusts, and the local government settlement, to which my hon. Friend the Member for Sheffield South East referred—and the list goes on—show that the Government have skewed the allocations away from supporting those in greatest need. The impression that the Government give is that they are prepared to write off whole communities to support more prosperous areas.

To find one example of a conscious Government decision to write off communities, we need look no further than housing market renewal.

[Bob Blackman (Harrow East) (Con)]

The hon. Gentleman is making a strong, powerful case on funding issues. One of the essential considerations is where to apply resources. Is the hon. Gentleman saying that the resources, limited though they must be, should be concentrated on the areas of greatest deprivation, or that they should be spread more thinly? Clearly, we cannot have it both ways.

[Simon Danczuk]

The point I am making is that the Government say they are spending £3.8 billion to £3.9 billion on regeneration, whereas in reality they are spending a fraction of that on market failure and areas in desperate need. That is a problem for communities—and that brings me to my point about housing market renewal and the abrupt axing of that programme. It was considered to be a long-term initiative, and was achieving success—the National Housing Federation said it had generated £5.8 billion of economic activity, created 19,000 jobs and maintained 2,600 jobs in construction each year. It was a success, but, setting aside all the statistics, it was creating new homes for people, giving hope to some of the people in our most deprived communities, and putting pride back into communities. Its abrupt ending is probably best described by Ros Groves, a Liverpool resident who gave evidence to the Select Committee, when she said,

“we have kids in schools; you ask them to draw a house and they will draw you a house with boarded-up windows, not fancy little curtains or anything else. To me, that is not a future that we can build on, which is criminal. We have a right to have a decent life”.

The Government should have used the present opportunity to frame post-recession regeneration in a different way. I readily accept that money is tight, banks are reluctant to lend, and developers are risk-averse. The challenge for the Government was to capitalise on that new landscape. They could have learned lessons from good and bad regeneration and disseminated the findings so that areas could regenerate better. They could have made areas more accountable for how regeneration money is spent—I admit that. They could have increased the skills of regeneration staff, so that they could leverage in more money from the private sector. Most of all, they could have concentrated their efforts and limited resources on the most desperate areas.