[Sir Alan Meale in the Chair] — Regeneration

– in Westminster Hall at 12:00 am on 19th April 2012.

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[Relevant documents: Sixth Report from the Communities and Local Government Committee, HC 1014, and the Government Response, Cm 8264.]

Motion made, and Question proposed, That the sitting be now adjourned.—(Mr Dunne .)

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee 2:30 pm, 19th April 2012

It is a pleasure to introduce the Select Committee’s report on regeneration. The Committee began the inquiry with a view to considering the Government’s statement on regeneration to enable growth—something that we have commented on in our recommendations. We recognised that, in the current climate, resources were always going to be limited. We therefore considered how the resources that were available could best be spent and, from past experience, what was likely to be most effective. We made inquiries along those lines on our visits to Manchester, Salford and Rochdale, and on my visit Liverpool and Bootle, too. During the inquiry, we had to comment on the Government’s reduction in funding to housing market renewal areas. That reduction has made a considerable impact that came up in our evidence.

I will refer to the Government’s response to our report. Perhaps unlike the recent Government response to our report on the national planning policy framework, the Government were not quite so supportive on this occasion as they were to our comments and recommendations on planning. However, I will obviously focus mainly on our report on regeneration.

Some of us—I am looking at you, Sir Alan—have been around this place long enough to remember a time before 2010 and previous Parliaments when the Select Committee, which has gone through various names, was called the Transport, Local Government and the Regions Committee. It conducted an initial report into empty homes in 2002. That was followed by a report in 2005 on empty homes and low-demand pathfinders, when I think that the Committee was called the Office of the Deputy Prime Minister Committee. The Committee has had various titles but a constant theme of deliberations on the problems of low-demand areas and regeneration.

As part of the Committee’s evidence sessions in 2002, I remember going to Burnley. Frankly, I was shocked by what I saw. We saw evidence of rows of terraced properties with selective pepper-potting of empty homes—properties becoming empty and no one going back to them as residents. We heard evidence of homes being exchanged in pubs for £2,000. Particularly for hon. Members from the south and other more prosperous areas, the idea of even buying a garden shed for £2,000 is quite ridiculous.

Photo of Rehman Chishti Rehman Chishti Conservative, Gillingham and Rainham

When the hon. Gentleman talks about the south and prosperous areas, does he accept that even in the south there are areas of high deprivation? For example, in

Gillingham and Rainham there is a seven year life expectancy difference from Gillingham north to Hempstead. Therefore, the regeneration issue cannot be divided between north and south.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

I accept that there are pockets—indeed, substantial areas—of deprivation, particularly in parts of London, but in towns and cities in the south as well. That is not something that we want to obscure. I was making the generalisation that house prices are generally more expensive in the south, where we would probably not find houses changing hands for £2,000 in the pub. However, the point about life expectancy is well made. Indeed, I think that at some point the Committee will consider the whole issue of public health and the new health and wellbeing boards in councils. I think that one of their priorities will be to address that issue.

Those properties were changing hands, and landlords who had little interest in their management were buying and letting them, often to people on housing benefit, with little attempt to control antisocial behaviour. Owner-occupiers who had previously spent their money—often their life savings—on their properties abandoned them. They walked out because they could not cope with the area any more. The whole area was therefore in a spiral of decay and decline. Clearly, there was population loss, and there were job losses, too. The relative isolation of some ex-mill towns in those parts of Lancashire was an issue, and one repeated in other parts of northern cities, too. We saw an area that was almost suffering death by a thousand cuts—a decline that was not being managed, because there was no effective public intervention. It was simply a matter of complete and utter market failure. There was no question of the private sector coming in with private investment, because the houses were simply regarded as not having any real value.

As a result of that experience and the report from the Select Committee, the Government set up the housing market renewal areas—pathfinders—and put in substantial amounts of public money. The Select Committee then published another report in 2005, which is interesting because it considered some of the same themes as the new report. One of the recommendations of the 2005 report, in paragraph 19, stated:

“The Government acknowledges that it will take up to 15 years to tackle failing housing markets or undertake market restructuring and many of the mechanisms such as compulsory purchase orders have a long lead-in time before taking effect.”

Setting up the housing market renewal areas and the indication of the need for a long-term programme was absolutely right. One criticism that the Minister has made of the Government at that time, which I accept, is that they should have done then what they did for the new deal community areas and actually made a commitment from the very beginning to 15-year funding. It is difficult for one Government to commit another, but the reality is that these areas have failed so much and the needs are so great and so long term—a theme that came out very strongly in our evidence—that Governments must be prepared to commit for that period.

There were other interesting recommendations in the 2005 report, and the Committee clearly heard conflicting evidence about the benefits of refurbishing homes or demolishing them and the whole issue of heritage. Paragraph 24 stated:

“The potential heritage value of the housing and its contribution to regenerating neighbourhoods should be considered an important part of any appraisal but houses should not be preserved for the sake of heritage if there is not the demand for them.”

That is a real issue. It is no surprise that many of those areas have failed markets with failed demand. Demolition has been the right solution locally, providing that it has been done in conjunction, consultation and agreement with local communities.

As part of collecting evidence for the current report that we are debating today, the Committee went to Manchester and Rochdale, and I went to Liverpool and Bootle. We saw streets of old properties that were in the process of being demolished. We talked to residents there, and to residents who had moved into new homes. Overwhelmingly, people said to us that the right decisions had been made. Some of the houses had been subject to housing action areas. I do not know how many people in the Chamber are old enough to remember housing action areas and to have been involved in them. Mr Binley is nodding from across the Chamber. Homes in those areas have been through one process of regeneration in an attempt to keep them going for 30 years. Those 30 years have now come to an end, and there was little point in trying to do them up once again.

I went to a home in Bootle—I remember it very well—where the property was right out on to the street. The backyard had two wheelie bins in it. They took up half the space, which illustrates how big the backyard was. I could hear water rushing underneath the property through the cellars and water coming through the roof. It is right that there should be local decisions about the future of those areas. In the vast majority of housing market renewal areas, there was full and proper consultation with local residents about what the future held for them and their properties, how they were moved on and decanted into properties nearby and an attempt to keep communities together. That was the right approach. Of course, some properties were capable of refurbishment—perhaps bigger and more substantial properties with the potential to be family homes when they were done up—but local decisions were the right ones to take.

Ros Groves lives in the Anfield area of Liverpool and gave evidence to the Committee. I remember her saying to me that it took a long time for communities to work through the order in which demolition and refurbishment took place. Someone had to be at the end of the queue; but even if they were, the promise was always that their home would eventually be dealt with. Everyone would have the same treatment as their neighbours. She said that the most demoralising thing as an elected local representative—someone who had been just a local resident and was elected by her colleagues as chair of the residents’ group and eventually chair of the collection of residents’ groups for the whole housing market renewal area—stood up at a meeting and said, “I’m sorry; we made promises in good faith that your home eventually would be subject to this renewal programme, either by demolition or refurbishment, and now the money has stopped.” She said, “I felt responsible for telling my neighbours that what was being promised them was not going to happen.”

Photo of Bill Esterson Bill Esterson Labour, Sefton Central

My hon. Friend describes the situation in Merseyside well, including in Bootle, my constituency neighbour. There are 6,000 empty properties in the borough of Sefton. He rightly says that people want these properties to be redeveloped and want the work carried out. I hope that he agrees that a combination of private and public money is needed to achieve that. In my constituency next door, people want those properties developed as well. The pressure knocks on, into the green spaces and the green belt. He touched on planning policy frameworks. All these things are linked up. Unless regeneration is done properly, particularly in respect of empty homes, other strong pressures come into play.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

I agree. Whether it is demolition or refurbishment, there is not one right answer. The right answer arises in the context of a local community making decisions. The worst thing that can happen is leaving the areas to decay, because housing pressures, which are not being responded to there, spill over into greenfield sites, although we would rather have houses either demolished and rebuilt or refurbished on existing brownfield sites.

In the end, the criteria are simple. Communities considered whether the areas had a future, whether there was demand for the properties and community support for refurbishment or demolition, whether houses had already been refurbished once, 30 years ago and whether they were adequate. For example, the house that I described in Bootle was built straight on to the road, with no back yard and little prospect of being made into a substantial family home. A number of properties in Skinnerthorpe road in the ward that I used to represent in Sheffield, which is now part of the constituency of my right hon. Friend Mr Blunkett, are tiny little homes that are damp and inadequate and were subject to demolition, but the larger homes on the road next door, which could be refurbished as family homes, were refurbished properly as part of an ongoing programme, generally with community support.

Photo of Rehman Chishti Rehman Chishti Conservative, Gillingham and Rainham

The hon. Gentleman talks about housing regeneration, but does he not agree that wider regeneration is related to providing the opportunity of hope and aspiration and linked, for example, to facilities in the area? There is a high level of deprivation in Gillingham north, for example, and an £11 million sports facility—Medway Park—which will host Olympic teams. Health, housing and providing such facilities in those areas are part of a combined approach, as Bill Esterson said.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

I shall make some points about that in a minute. The hon. Gentleman anticipates what I am going to say and makes a valid, correct point.

Our fundamental criticism of the Government—it will be interesting to hear what the Minister says—is that we did not believe that they had a strategy for dealing with the issue. We did not believe that there was such a strategy in the Government’s report on regeneration. We even contrasted that report with the approach to regeneration in Scotland, where the Government seemed to have an overall view of what should happen. It is not just a party political point. I am sure that the Minister will be relieved about that.

In the 2005 report, when we had a Government of a different persuasion, the Committee was critical of the Government allowing the pathfinders to go their own way, but not of drawing together themes and trying to enable them to learn lessons from one another. Our criticisms reflect those of a previous report on a previous Government. We do not ever seem to have had an overall, clear national framework.

Photo of James Morris James Morris Conservative, Halesowen and Rowley Regis

From the inquiry I recall conflicting evidence about what we mean by regeneration. A lot of the evidence we heard was that people could not give a single, coherent definition of what regeneration was. Will the hon. Gentleman give us his definition of regeneration?

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

I will explain what I think it is about. The hon. Gentleman anticipates me. I do not know whether it is helpful to give a simple definition of regeneration to cover all possible examples, but it should reflect some elements of regeneration schemes.

The hon. Gentleman’s first point is right. There was a lot of mixing up of regeneration and growth. For example, High Speed 2 and Crossrail were mentioned in the Government’s regeneration paper as examples of funding to help regeneration. It is a fairly big stretch of anyone’s imagination to link HS2 and Crossrail to the potential for regeneration schemes. That is a little step too far. I am happy to support those schemes and believe they will help economic growth nationally, but I am not sure whether they really relate to particular regeneration.

Photo of Brian Binley Brian Binley Conservative, Northampton South

The hon. Gentleman is making a great presentation and has produced an important report. In respect of Crossrail, particularly, Committee members were able to get a station in Woolwich, which was an important part of the process in this House that will have a massive effect on regeneration in that area, which so badly needs it. Perhaps the hon. Gentleman should be a little careful about sizeable projects and their impact on specific communities.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

I am all in favour of HS2, which will be good for growth in northern cities, such as Sheffield. I am a strong supporter of that and have been for a long time. When considering specific areas—coming back to the point made by James Morris—regeneration is a response to market failure, as we saw in Burnley, where houses were sold for next to nothing. To take the point made by Rehman Chishti, there is a wider issue of failure of environment, dereliction, failure of skills and lack of employment opportunities.

Photo of Rehman Chishti Rehman Chishti Conservative, Gillingham and Rainham

The hon. Gentleman is right, but in terms of the definition of regeneration, does he agree that one could easily say that regeneration means different things to different people, as with subsidiarity in European law? Linked to regeneration are key attractions, for example, the Dickens festival and the Medway Queen, which is a historical attraction that people come out to see. European funding for such projects is crucial. Ministers should come and visit Gillingham, and I hope that the Minister will visit.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

Regeneration is defined widely. Different areas will have different needs and a different response will be required. I agree with the Minister that that is why, in the end, a localist approach to what works in an area is important.

With regard to my comments about Crossrail and HS2, which are massive, major projects involving billions of pounds of expenditure, if a tiny bit of that affects one area, then good, but it is a little bit difficult to recognise such projects as regeneration funding as a whole. In Burnley, Liverpool and Rochdale, we saw market failure and nothing will happen without some public funding. That was the message that came over to us. If the public money is not there, the private money will not be there either. The two need to go hand in hand. As witnesses said to the inquiry, no regeneration is happening in Britain at present, because it has virtually come to a standstill. There is a bit of the tail-off of housing market renewal in respect of schemes that are being wound down, but that is all. There is a need, potentially, for the private sector to invest with some gap funding, which, again, may be available through the European Regional Development Fund, which I will mention in a second.

Regeneration and market failure is not just about bricks and mortar; it is about the environment, as well as various facilities, skills and jobs. If we are going to tackle the difficult, fundamental problems that we see in some of the worst areas, there probably has to be some concentration of whatever public money can be found—recognising the issue of the public finances—in those particular areas. I have made the comment already, but the previous Government’s failing was not in making the money available, but in not committing it for a long enough period to see the schemes through to a successful conclusion.

Photo of Mark Pawsey Mark Pawsey Conservative, Rugby

I am mindful of the advice from the mayor of Newham, because there is rather more to regeneration than continually putting in public money. The mayor’s evidence was that, despite 20 or 30 years of continuing investment, the indices of deprivation had not moved. It is sometimes a matter of attention, not only of continually putting the money in.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

The hon. Gentleman makes an interesting point. It has been said, in particular about helping with skills and improving people’s availability for employment, that what happened was that people in Newham who got that help then moved to other areas. There are clearly challenges to making regeneration successful. One of the criticisms we made in the Select Committee report was about learning lessons from the past. We should look at where money has been spent—Bob Blackman was keen on that in the Committee—and at what was got right and wrong.

We took evidence from Lord Heseltine and went to Hulme to look at the city challenge area which, in everyone’s view, was a success. It was, however, a 20-year project and, to begin with, did not go well. Lessons were learnt from initial failures, but it was a 20-year programme with the public and private sectors working together; it was about not only buildings but skills, employment opportunities and the general environment of the area. It was also a lot about demolition of some really bad properties, and their replacement with new, attractive properties in the private as well as the public sector, as we saw on our visit.

The issue of the long term is so important. The hon. Gentleman is right that we can have long-term projects that still go wrong, but if we do not do things for the long term we will not get some areas right at all. There was a lady in the community centre in Rochdale who said to us—she had not been briefed and she put it in her own way—“It is a bit like going on a weight-loss course. It is easy to get a few pounds and even a few stones off at first, but it gets harder and harder. You have got to keep working at it. If you don’t keep going at it for the long term, you clap the weight back on and all the hard work of the previous time has been lost.” That is a real worry now in some housing market renewal areas—that the investment has gone in but stopped halfway, so some of the benefits will be lost. That lady’s comments always stuck in my mind. She was so enthusiastic about her area because it had been about improvements to the school and to employment opportunities. I remember she said, “I used to be ashamed to bring visitors. In fact, I used to pretend that I didn’t live here. Now when they come to visit, I walk down the street with pride because of what has been done.” That is an awfully good testament to what happened.

We ought to learn lessons from the failures. I am trying not to be party political, and the single regeneration budget had some successes but, very often, it was spread too thinly around the place, to give everyone a little bit but without achieving any long-term benefits. Let us learn from the problems of the past as well as from the successes achieved—that is a bit of common ground with the Minister at least. The regional growth fund was proposed as a possible solution, but Lord Heseltine has told the Committee, absolutely bluntly, “This is not about improvements for housing. There is no money here for those sorts of initiatives.” He told us that, in words of one syllable. He basically said, “It doesn’t matter what the Minister says, I am in charge of this”, and I am sure that the Minister does not want to argue with Lord Heseltine on such points.

Photo of Grant Shapps Grant Shapps The Minister for Housing

wondered whether the hon. Gentleman had noted that two major housing market renewal areas were covered by the £2.4 billion regeneration money.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

Some schemes will affect HMR areas but, in terms of pure concentration on regeneration issues, Lord Heseltine was quite clear to us that the focus of his scheme was about jobs and not about improving homes in any shape or form.

Photo of Grant Shapps Grant Shapps The Minister for Housing

Will the Chair of the Select Committee accept my point that people in regeneration areas really do not give a damn which budget is being used to regenerate the area?

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

Most of the people that I have spoken to simply hope that some budget is available—that is our criticism about identifying what budgets were available. We had the Growing Places fund which seemed to be mainly about benefiting places that are growing, rather than places of market failure.

I will make one aside, which is probably party political. Yes, of course there are reductions in public expenditure, but is it really fair to have a 19% overall cut in public expenditure in the current spending round, a 28% cut in local authority grants, a 50% cut in funding for social housing investment and a 100% cut in regeneration funding through the HMR scheme all at once? That is to put the situation in stark terms.

Let me continue, however, by saying that the Select Committee recognised some really positive developments. We certainly welcomed tax increment financing and local enterprise partnerships, but we wanted to be sure that LEPs were aware of the need to link into regeneration areas. If LEPs are creating jobs, how can they then help to benefit people in some of the poorest communities? That is a positive point. TIFs of themselves are not aimed in particular at regeneration schemes, but they can of course create projects that benefit people in regeneration areas, although how that funding can then be properly linked is a challenge.

We were pleased by the Government commitment on the European regional development fund and their intention to spend all the ERDF budget. Indeed, the Committee will do a further report on that. That has potential for the gap funding to which I referred. The challenge is ensuring that the funding is used and that it is used as constructively as possible in regeneration areas.

We also very much welcome the extra transitional funding of £35 million that the Government found. That was helpful, because of the despair in some of those areas, where only one in 10 houses are lived in and people are struggling in desperate circumstances. To have the funding simply cut off was a real blow, so it was good to have a bit of money put back in the five worst areas, with matched funding from councils, to help people in such conditions. I am sorry about comments in the press in the past few days from some people, who do not live in those areas, complaining that the Government are funding demolition. Of course they are. If nine out of 10 houses are not occupied and we still have to deal with the one that is, the only logical conclusion is to demolish, and to create the area for future regeneration. Of course that is the logic. The Government should be supported in doing that and in working with councils on the problem—I certainly do so.

Photo of Bill Esterson Bill Esterson Labour, Sefton Central

My hon. Friend is describing well the need for massive levels of investment in such areas, but the mention of Lord Heseltine made me want to contribute. There is a rather unfortunate association with the early ’80s in Merseyside, given the release of Cabinet minutes suggesting that the idea of managed decline was something that the Government of the time were considering. Lord Heseltine was of course the one who made sure that that did not happen—to his great credit, and he has recognition for that on Merseyside. My concern, however, is that unless what is recommended in the report is put in place, we could see that managed decline happening in all sorts of places up and down the country.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

That is a worry and it is why intervention by public bodies, whether Government or local authority, is necessary. I am sure that Merseyside will be in there fighting its corner.

We paid a visit to Greater Manchester and had an interesting briefing, not merely from the local authorities, cross-party and working together, as they do, on a strategic partnership basis, but from the private sector as well, arguing the case for the infrastructure and skills budgets for the city region to be brought together under local control. The Government have responded positively through the community budget “whole place” initiative, and the revolving infrastructure fund for the Greater Manchester area is another positive step forward. The city deals that the Government are trying to reach are also to be welcomed. Hopefully, more powers will go down to the local level. If cities choose working together to target resources in particular ways to stimulate and to help regeneration, they will be free to do so. Those are a welcome response to the report and the issues we identified.

To conclude, we are dealing with some of the poorest areas in the country—yes, some in the south, as well as in the north and the midlands. Such areas have already had years of decay and decline. If there is no recognition of that, no intervention and no public money made available, those areas will simply get worse, more areas will fall into similar decline and the cost of putting the problems right in the long term will be even greater. In the meantime, the cost in human misery will be substantial.

Photo of Brian Binley Brian Binley Conservative, Northampton South 2:59 pm, 19th April 2012

It is a pleasure, Sir Alan, to serve under your chairmanship again. We spent two and a half years almost living together on Crossrail, and if you would like me to define that further, I am happy to, but perhaps you are pleased to let it go. It is good to be working with you again.

I again congratulate the hon. Member for—is it Sheffield, Brightside?

Photo of Brian Binley Brian Binley Conservative, Northampton South

I apologise. Perhaps it is my history that takes me back to Brightside.

Mr Betts has, with other Committee members, done a remarkable and important job. I also congratulate him on obtaining this debate on regeneration, which is a vital part of coming out of recession. This is an opportune time to be discussing the subject.

I welcome the report. I understand the Government’s emphasis on a localist footprint, which is very encouraging, and that was echoed by the hon. Gentleman. However, some resonances in the report caused me concern. The anticipated absence of funding must be taken into account. We created local enterprise partnerships from a perspective of getting local involvement, but we rather underestimated the importance of funding, particularly in the early stages of their work. That is not directly under the Minister’s control, but it is an important part of the subject.

Too much emphasis can be placed on changing the planning system to solve our problems. The issue is not all about what the Government and local government organisations can do. Planning always needs changing. It never pleases everyone at the same time, and can be over-bureaucratic, but its reformation—we have seen a number of reforms over the years—is not necessarily the great Aladdin’s lamp that it is painted as being. I have some concern about that.

The Committee’s enthusiasm for a national regeneration strategy could muddy the waters if done incorrectly. That needs careful consideration but, having known its Chairman for a considerable time, I know that that will be in his mind.

The trouble with our economy at the moment is that we are faced with a massively changing dynamic within the economic world, which has created a heavy price for some localities. De-industrialisation has left a vacuum in many communities and needs special attention. I am thinking particularly of the coal community, and communities that relied on heavy manufacturing. It is not a new problem, but it is an existing one, and we must recognise it. It brings with it a changing pattern of employment and lifestyle, which has often rendered existing infrastructure outdated and sometimes even irrelevant. That adds to the problems that regeneration revolves around, and we must be careful to take those matters into account.

A very disturbing problem is young people who have struggled to find their place in the labour market. When I left school at 15, I knew that I would go straight into employment. I knew that there would be a job. It was in a shoe factory, which was the local industry, but that did not matter. I went into the workplace, and working has always been an integral concept and part of my life. It affected and moulded by lifestyle and my attitude to life. If we allow a generation to continue to think that life can be about not working, and if we allow some people even to see that as a potential career, we will do massive damage to their chance of enjoyment and achievement in life. We must take that into account when talking about regeneration.

The mindset about regeneration is often negative and backward looking in that many people grow attached to a specific area and the work they are involved in. Often, regeneration, if done badly, can create the mindset of backward-looking negativity. We must be aware of that.

I beg the Minister to recognise that risk aversion is almost a national disease now. If many of the risk management techniques that we have now had existed at the time of the industrial revolution, many projects would not have got off the ground, and Britain might still be messing about in a pre-industrial age. I want to change the concept of risk management. It should not be about stopping things happening, but it often becomes that, because that is an easy way of looking at it. I beg the Minister to see risk aversion as a problem instead of an answer.

If we are to make regeneration effective, we must focus on the positive. When regenerating an area, we must encourage people to feel part of that regeneration. Investors need to experience the confidence of the knowledge that people are involved and have ownership of their areas. All too often, regeneration has been seen as a council responsibility and, by golly, we know that when government becomes involved in projects, as many things go wrong as go right. I want people to be involved so that they can check, police and give to a regeneration policy, to avoid such negativity. I want regeneration to be owned by the local citizenry. We must find ways of involving them. It is no good just putting up posters advertising a 12-week consultation.

If a project lasts 10 or 15 years, they must be involved for 10 or 15 years. We must listen to them, and react to what they say. Otherwise, they will not feel that they have ownership, and that is important.

I turn to Northampton, as the Minister knew I would. It is one of the fastest growing towns in the country, which also creates problems. Housing was the object of the previous Government’s growth agenda, as it is of the present Government. By about 2030, our population will increase by 50%, which is a massive change. It is a difficult change, whether for good or bad, and it needs to be managed properly. I have some leaflets here if anyone wants to know about the Northampton Alive project in more depth. You allowed me to get away with that, Sir Alan. The 10 to 15-year project involves heritage, and Northampton has a long heritage. Parliament met there during the days of Edward II and Edward III. Thomas à Becket was there but, not surprisingly, shot out of town quickly when the king asked,

“Will no one rid me of this turbulent priest?”

Sadly, we saw the result of that later.

Northampton enjoys a massive heritage, and we must include that in our view of regeneration. It is central, well connected, and has an enviable record of world-class business investment with the prospect of an even brighter future. The Northampton Alive project consists of a series of 14 or so ambitious regeneration schemes across the piece including, hopefully, an iconic new railway, a landmark waterside development, new and improved shopping—I could go on. The project has captured the people’s imagination, which is what this is all about. We are not focusing on missed opportunities from the past, but preparing to optimise our chances for the future. That is about involving people and getting them excited. When I knocked on people’s doors in the election, some said, “Northampton’s been dead for 40 years.” Reinvigorating those people is a vital part of regeneration. We must understand that regeneration changes the mindset of individuals, as well as the structure of towns.

The real strength of Northampton Alive is that it reaches beyond the confines of development to involve our university, our schools and colleges, local businesses, the borough and county councils, political parties across the piece, West Northamptonshire Development Corporation and the local enterprise partnership. Ownership is diversified because all those organisations are involved in at least one project, and many are involved in several.

Photo of Mark Pawsey Mark Pawsey Conservative, Rugby

One thing that came out of the Select Committee’s work was the need to engage local communities. My hon. Friend mentioned a number of bodies involved in the Northampton scheme, but many of them strike me as fairly corporate. What is happening to communicate with individual people in local communities across the piece?

Photo of Brian Binley Brian Binley Conservative, Northampton South

My hon. Friend is absolutely right to mention that. I can show Members my newsletter. Councillors from all political parties have encouraged people to become involved in Northampton Alive. In the town, we have built a small steering group, as well as a forum of 60 to 80 leading people from across the business, cultural and heritage sectors, the political parties and the Churches. This is a bounce-back, talk-to, ideas-back operation, and those involved meet every four to six months. This is a 10 to 15-year project, and we know we have the involvement and input of local people. We are not only telling all the people of the town about Northampton Alive, but advising them to become involved in it, and that is important.

Photo of Neil Carmichael Neil Carmichael Conservative, Stroud

I, too, am keen on regeneration. In Stroud, we have the huge, £20 million canal project. The local authority is very much involved, but I would emphasise the need to involve the community. I have set up a canal forum with the aim and objective of making sure that communities—those without the labels my hon. Friend Mark Pawsey mentioned—are involved. Does my hon. Friend the Member for Northampton South agree that the key instrument in this—the one I shall be using—is neighbourhood planning, which will be a useful tool in engaging our local communities and enabling them to set out the framework and the ideas for these projects?

Photo of Brian Binley Brian Binley Conservative, Northampton South

There is no end to the consultation and involvement we should have with the people of our communities. All too often, such projects have been seen as the council’s business, and things often happen in people’s backyards without their even knowing they are happening. That is totally unacceptable. I want to explore every way of involving people and to make every effort to ensure that their views are taken into account. In that way, we will create a successful project, even when it lasts for 10 to 15 years. I therefore accept my hon. Friend’s comments.

My county stands at the crossroads of England, and it has a number of things going for it. Those of us involved in regeneration have focused on relationships, and we have kept our ambitions in line with what we can achieve. There are three real priorities. Improved connectivity is vital. Leadership in climate change and biodiversity are also important. Finally, there is a stronger, greener community.

Our opportunities are limited, but also enhanced, by certain factors. Population growth is a key factor, and I have talked about the town’s growth. Our economy is worth more than £13.5 billion, but £1 billion of the money earned in the town is spent outside it because our retail offer is not good enough. Dealing with that is another part of the regeneration exercise.

We do, however, have impressive links with the rest of the world, particularly the middle east and China. We can use those links to attract businesses to the jewel in the crown of our regeneration—the enterprise zone. We hope to create 10,000 jobs, and perhaps more, in the next eight years, with 390 new businesses, £5 billion of private sector investment and about 400,000 square metres of new employment and retail space. That is a massive operation, which needs to be sold globally if we are to attract enough people, particularly in high technology and precision engineering. That is what we need to do if our enterprise zone, which is the biggest in the country, with more than half the land area of all the enterprise zones announced in the second tranche, is to work.

Northamptonshire provides an important lesson. It is an important pilot project, from which other people can, I hope, learn. Regeneration is an opportunity that should be grasped positively. Too often, chances across the country have been missed through misdirected optimism and inflated ambitions. When we set out on such projects, we must be realistic and know that they can happen. That is why we need to involve all the groups we are talking about, and more. As I have said, everybody needs to own the project.

Regeneration can unlock so much that is good about a locality. When we sell regeneration, it is vital that we also sell lifestyle. We are talking not just about buildings, construction and fabric. People will not move to Northampton for a decent business site alone, although having one helps; they will move there if we can make sure the town has heart and life and can provide them and their children with a good lifestyle. The more I speak, the more I hope Members will realise that regeneration is a big package, which requires all the involvement I have described.

I am talking about the people retaking ownership of regeneration. That means dropping the pervading negativity. It means stopping focusing on what money is spent and how. It means ensuring that the private and voluntary sectors can work alongside communities. If they work together, projects will gain people’s respect and involvement, and people will want to be part of the regeneration. If we achieve that, the rest will follow.

We can make regeneration an adventure for our local community and for those people who, when I knocked on their doors, repeatedly told me, “Northampton’s been dead for 40 years. Milton Keynes down the road is much healthier and much better placed.” To those people, I say no, it is not. It does not have our regeneration potential, our history, our heritage or our craft industries. We are very well placed—all we have to do is make Northampton alive.

Photo of Simon Danczuk Simon Danczuk Labour, Rochdale 3:18 pm, 19th April 2012

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 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 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, 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.

Photo of Bob Blackman Bob Blackman Conservative, Harrow East

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.

Photo of Simon Danczuk Simon Danczuk Labour, Rochdale

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.

Photo of Martin Vickers Martin Vickers Conservative, Cleethorpes 3:30 pm, 19th April 2012

I echo other hon. Members in saying that it is a pleasure to speak under your chairmanship, Sir Alan, and I compliment the Chair of the Committee, Mr Betts on his presentation of the report. Those of us who have served in local government for a long time will remember things such as housing action areas—indeed, I lived in one. We have seen many schemes come and go, and certainly in my area the housing revenue account system was one of the more successful.

Like the Chair of the Committee and other hon. Members, I represent an area that has lost one of its core industries. Many of my constituents from Cleethorpes worked in and around Grimsby docks, which was the core industry in our area. For many years, therefore, tourism has been absolutely vital, particularly in Cleethorpes. Although I share the hon. Gentleman’s analysis in his introduction of the debate, I am disappointed with the tone of parts of the report that seem to hark back to past failures.

Yorkshire Forward was the regional development agency in my area, although it was a disappointment from the start in that it did not mention Lincolnshire. It was good, however, at producing many plans, and I served for five years in a Liberal Democrat-Conservative coalition on North East Lincolnshire council. To suggest a parallel with anther situation, we inherited a council that was basically a financial basket case, and spent three or four years concentrating solely on finance.

Once we were able to break out of that and look at regeneration, economic development and growth, we were hampered by the process-driven strategies of Yorkshire Forward, which, as is generally recognised in northern Lincolnshire, delivered little or nothing. Yes, it created grand visions and consulted with the public—that is essential, as has been mentioned—but the consultations raised expectations beyond what was achievable. Things such as the single regeneration budget and other measures were introduced, and some useful regeneration did take place, but on the whole it was rather disappointing, although I accept that work was done in other parts of the region. If the Secretary of State for Communities and Local Government were present, he would say that regions do not exist any more, but the fact is that for many reasons we are still told that we are part of Yorkshire and the Humber.

Much good work was done by the previous Government in cities such as Sheffield, Leeds and others, and we can see how regeneration projects have considerably improved the areas. However, more provincial towns situated in my constituency were—I will not say forgotten, but to some extent too much emphasis was placed on the cities. I hope that the Minister will give me some encouragement that there will be a trickle-down effect towards the smaller towns over the next few years.

The debate about what is growth and what is regeneration has been interesting, but I do not see how we can have one without the other. Regeneration produces growth, and if there is growth, there are more resources for regeneration—it is a circular argument. As the Minister noted in the report, regeneration can mean a great many things. It is not only about the built environment—important though that is—but about health, education and transport, and all the relevant Departments must contribute. Nevertheless, the physical regeneration of our towns is the most noticeable factor because it provides an uplift; the feel-good factor returns, and we need only to go into a new housing estate, school or whatever to appreciate that.

The Department for Communities and Local Government has proposed various initiatives for the high street, and my area was encouraged by the Minister’s colleague, Greg Clark—I never know what his title is because I have seen it listed as the Minister for Cities, Planning Minister and so on. He is a bit of a jack of all trades, but he does all those jobs very well. He came to my constituency a few weeks ago, and the high street was one of the places to which we took him. I am encouraged by some of the initiatives that we hope will emerge in the not-too-distant future.

We need to harness the initiative of the private sector and local investors, and we are seeing that key Government aim come together in the local enterprise partnerships. We had far too many strategies. I noticed somewhere in the report the claim that we are lacking in strategy, but my area had strategies coming out of its ears—“strategies and support” was the phrase used. Whenever we could not define what a certain committee did, we said that it was responsible for strategies or support; it was an all-encompassing phrase that could mean anything or nothing. For a while, I chaired something called the Hull and Humber ports city region transport board. During my two years on the board, I do not think that any of its members, the private sector or the officials, managed to work out what it was actually for, but the guidelines said that it was responsible for strategy.

I mentioned the leadership that I hope will emerge from local enterprise partnerships. An essential ingredient of any successful regeneration scheme—this could be applied to Lord Heseltine and Merseyside, for example, which was mentioned earlier—is the need for some sort of dynamic leadership. That is necessary not only at political level but with local investors and businesses. If those things come together, they can create a vision for the area without the need for thousands of consultants and bureaucrats, and that does not necessarily need to impinge on every aspect of the local community.

Our forefathers who developed our great cities—one can still go to Birmingham, Liverpool and so on and see what they achieved—did not hire a consultant, produce a document and go into endless consultations. They got on with things and ignored the people around them who were saying, “Oh, it will cost money; it will be delivered late,” and so on. They achieved something that we can still see a generation or two later.

We must all mention our own areas in our speeches for the sake of press releases and so on, and I choose a different place in each debate. This time, I shall mention New Holland, of which I suspect few Members will have heard. Before the days of the Humber bridge, the ferry ran from New Holland across the River Humber to Hull. New Holland is a small town that desperately need regeneration. I have discussed that with North Lincolnshire council, social landlords and so on. Very modest amounts of money, whether channelled through Departments, local enterprise partnerships, or whatever, can kick-start regeneration in a place such as New

Holland that has a population of a few hundred. We owe it to the people of those communities to do something for them.

The Select Committee’s conclusion is on page 69 of its report. The point that stood out for me more than anything else was that we need

“a plan for bringing in private sector investment, considering, amongst other things, potential sources of gap funding” and

“the role of initiatives such as Tax Increment Financing and Enterprise Zones”.

Part of northern Lincolnshire has the largest enterprise zone in the country, and we are deeply grateful to the Government for delivering that.

This is the other point that I noticed on page 69:

“It is crucial that the strategy be based upon a clear understanding of lessons from previous approaches”.

That is what I emphasise as well, because as I said, we failed in my area as a result of the process that was insisted on by the then Government agency.

Incidentally, I am delighted that my hon. Friend Jessica Lee is in the Chamber. I am sure that she will contribute later, because paragraph 17 on page 68 says:

“We recommend that the Government disseminate to relevant bodies guidance setting out the possibilities for the use of JESSICA in regeneration.”

We therefore really look forward to hearing from my hon. Friend. With that, I will conclude.

Photo of Heidi Alexander Heidi Alexander Labour, Lewisham East 3:40 pm, 19th April 2012

I have enjoyed the debate so far. We have heard excellent contributions from hon. Members on both sides of the Chamber. I particularly enjoyed the enthusiasm shown by Mr Binley in talking about the potential of regeneration to unlock the futures of the next generation. That is what we are talking about when we talk about regeneration: how we can improve parts of our towns and cities—our country—for the next generation. I also enjoyed the speech by my hon. Friend Simon Danczuk. I agree with all that he said about how funding dedicated to regeneration projects has fallen considerably. No matter how the Government try to dress that up, the facts speak for themselves.

My own view on the regeneration strategy produced by the Government is that it is woefully inadequate. When I first read the document last year, I genuinely thought that pages were missing from the copy that I had been given. The document contains three and a half pages of text and then a series of tables. The tables are primarily about policies and initiatives that have already been announced by the Government. The information has pretty much been cut and pasted from different Departments’ websites and put into those tables. If that is the Government’s strategy, if that is the sum total of the Government’s interest in regeneration—three and a half pages of fresh text—I am concerned about it.

The best description of the strategy was given to the Select Committee by Neil McInroy, chief executive of the centre for local economic strategies:

“If one of our junior members of staff had written this after two weeks, I would be disappointed.”

It is fair to say that we did not really hear anyone speak particularly positively about the document when they gave evidence to the Committee.

To call this “community-led” regeneration and to talk about what the Government are doing to support community-led regeneration adds insult to injury. Giving communities the power to do something is very different from giving them the means to do it. There can be all these fancy initiatives, but if the communities themselves do not have access to land and resources and the know-how, knowledge and skills to make things happen and to work with the myriad different players involved in regeneration—the public sector agencies and the private sector—that will not happen. That is my concern about the strategy that the Government produced.

So I ask myself this: when the Select Committee did its report, was the Government’s response to the Committee’s report any better? I do not think that it was. The Select Committee called for the Government to produce a national strategy for regeneration, and the Government said no. The Select Committee called for the Government to evaluate their new approach to regeneration. The Government talk about giving local authorities a toolkit of options to work from in bringing about regeneration. The Select Committee said, “Can we evaluate this new approach?” The Government said no. The Select Committee suggested that the Government commission a study of stalled regeneration schemes across the country to understand the scale of the problem that the country faces. The Government said, “No, it is for local authorities to identify those schemes that have failed.” I could go on and give a very long list, but I will just say this. We also said to the Government, “Please review how the knowledge and skills that have been built up in the regeneration sector but are ebbing away at the moment can be captured.” We suggested that the Government look into that. They said, “No, that is for the sector itself to do.”

In their response to the Select Committee’s report, the Government talk about a “localist vision for regeneration”. If people want that translated into plain English, I suggest that it is the “washing your hands of the problem” approach to regeneration or the “sink or swim” strategy for regeneration. That is fine if all areas have the same ability to swim, but as we have discussed, some areas suffer from the effects of deindustrialisation. Some areas will not be as advantaged as others in terms of the metropolitan area in which they are located. Perhaps they are areas that provide employment to the main city. Some areas do not have the same ability as others to get on and attract the private sector investment that is necessary.

That is the problem with the Government’s strategy as it stands: it does not give anyone confidence that the Government accept and understand that the country’s current economic problems are affecting different towns and cities and different parts of the country in different ways.

Photo of Jessica Lee Jessica Lee Conservative, Erewash

On that point, is not the entire purpose of localism that people do respond? Communities have different needs, but setting them free and empowering them through the Localism Act 2011 and other measures means that local decisions can be appropriate to a local community. The Big Brother approach is not the correct one; the state does not always know best. That is a fundamental difference between the response and approach by the current Government and the response of the previous Labour Government.

Photo of Heidi Alexander Heidi Alexander Labour, Lewisham East

I agree that community involvement in regeneration is vital. During my time on Lewisham council, I did huge amounts of work on stimulating genuine community involvement. I go back to the point that I made earlier: with the best will in the world, communities sometimes need other help to get schemes off the ground. Sometimes that involves public money. Sometimes it involves initiating a discussion with private sector partners to get them interested in the area to start off with.

Some parts of the country are being hit very hard in the current economic climate. Before coming to the debate today, I looked at the unemployment figures and researched some of the statistics for the constituencies of other members of the Select Committee. In my own constituency, Lewisham East, 29 people are chasing every job, yet in Rugby nearly three people are chasing every job and the position is the same in Welwyn Hatfield.

Photo of Grant Shapps Grant Shapps The Minister for Housing

Given that the hon. Lady is now making a very coherent argument about jobs and how important they are for regeneration, can she explain why the Select Committee takes the view through its Chairman, Mr Betts, that job generation through the regional growth fund—some 360,000 jobs—is not regeneration?

Photo of Heidi Alexander Heidi Alexander Labour, Lewisham East

Regeneration is about jobs, decent homes, improving the quality of the environment—so many different things. It is not good enough to look at big infrastructure programmes and assert that the economic impacts of those new bits of infrastructure will somehow trickle down to some of the communities that are excluded most from the labour market. Given that I represent a London constituency, that issue is very close to my heart.

When the riots took place last summer, a group of people massed outside Lewisham police station at the start of the problems in Lewisham. They stood on the site of a stalled regeneration project. Although it would be too simplistic to say that if only the regeneration scheme had gone ahead, we would not have had the riots—there is not a direct correlation between all the places where riots happened and all the places in need of regeneration—areas with significant economic and social problems experienced some of the worst rioting. If we are to give hope and aspiration, jobs and opportunities to the next generation, we must invest in the areas where those people live. It is about so much more than putting up shiny new flats. It is about giving people the skill and opportunity to access jobs and about quality of life and life chances. We know that in some parts of the country hope, determination, confidence and ambition are harder to find than in some other places.

All Governments of different political persuasions over the past three decades have recognised the differences in economic and social capital in different parts of the country. Moreover, they have all had some form of geographically based, area-focused regeneration programme or initiative such as city challenge, the single regeneration budget, new deal for communities, the neighbourhood renewal fund and so on. I am not saying that all of them were perfect or that we should not learn the lessons from them. However, I would say that this Government seem pretty unique in not having any form of geographically based area regeneration scheme in place. They might talk about the regional growth fund and say that that is focused on areas that are more highly reliant on public sector employment and that are experiencing problems with the decline in the public sector work force, but we have already covered that territory. As we know, Lord Heseltine, who chairs the board that considers the bids that come in for the RGF, has basically said that they are not about regeneration. I suggest to the Minister


Does the Minister want to intervene?

Photo of Grant Shapps Grant Shapps The Minister for Housing

I am grateful to the hon. Lady for allowing me to intervene. The point about the regeneration fund has been made several times and often misleadingly. Although it is not primarily about housing regeneration in housing market renewal areas—I have mentioned two HMR areas that have benefited from RGF funding—it is indeed about regeneration, as the name suggests. It would be quite bizarre to somehow exclude this multi-billion-pound fund.

Photo of Heidi Alexander Heidi Alexander Labour, Lewisham East

I was quoting Lord Heseltine when he gave evidence to the Select Committee. Let me quote him again. He said:

“I have said quite clearly that we are not about regeneration.”

Perhaps there is some miscommunication between the Minister and Lord Heseltine.