URBAN REGENERATION AND GOOD GOVERNANCE
116. Most witnesses argued that local authorities
should be the lead players in the urban renaissance. They agreed
with the Urban Task Force that there was no alternative but to
"empower local authorities to ensure the whole of the urban
environment is well managed". We were told
"Local authorities must be given a clear mandate
to lead the urban renaissance in partnership with local people
under the regional and local institutions. This means greater
devolution of power and resources to ensure that urban institutions
are equipped for the task ahead. The key recommendation is to
deliver long-term funding commitments to local authorities and
their partners and increase the freedom available to local institutions
in raising, combining and allocating available resources.";
"We would like to see the Urban White Paper
starting to set some national priorities for regeneration, then
allow local authorities, indeed to trust in local authorities,
to get on and deliver that at a local level and monitoring that
"We would expect support for the principle that
local urban areas are different, experiencing different challenges
and opportunities and that the autonomy of local government is
117. Like Towards an Urban Renaissance, which
lists many of the failings of local authorities, witnesses took
this view despite acknowledging the shortcomings of urban services.
One said: "Some really need a bomb under them."
However, they recognised that there is no satisfactory alternative
to local authorities. The initiatives of Whitehall departments
have not been more successful.
118. The White Paper should make a clear statement
of the role of regional organisations: regional planning conferences,
regional development agencies, the government offices in the regions
and regional assemblies\chambers. Witnesses argued that it was
unclear what their respective roles were, as the Performance and
Innovation Unit Report concluded. The relationship between Regional
Planning Guidance and Regional Economic Strategies is, as we have
previously reported, uncertain. There is considerable overlap
between the Single Regeneration Budget run by the regional development
agencies and the New Deal for Communities under the government
offices for the regions. European funds should be co-ordinated
with other funding.
119. The sub-region is particularly important given
the peculiar and tight administrative boundaries of many cities.
Sometimes, as at Leeds, the city has broad boundaries, but elsewhere,
for example Manchester, they end not far from the city centre,
producing several adverse consequences. Witnesses argued for politically
powerful conurbations. Birmingham City Council made the point
in this way:
"Traditionally, urban policy has been based
upon small areas or the local authority area. More recently, the
regional dimension has been strengthened. Yet many of the key
problems and opportunities occur at the level of the city-region.
By this we mean a functionally integrated area normally comprising
a core city, contiguous urban areas, and free standing towns and
villages. It is at this level that the housing market, labour
market, transportation system and leisure and cultural systems
operate, and it is these systems that create many of the principal
problems and opportunities. The city-region is therefore a critical
level for strategic planning and intervention."
The White Paper must establish mechanisms to enable
decisions to be made for the whole city, town or conurbation in
a sub-regional context.
120. Local authorities, as many witnesses argued,
must encourage participation and involve local communities in
Mr Brown of the Royal Institution of Chartered Surveyors told
"I think local authorities are the critical
player. They are the body with local democratic accountability
but that is not to say they are the only player. I think they
need support from regional development agencies and English Partnerships
for example. They also critically need to engage with communities."
Another witness told us:
"If it is to be effective the urban white paper
must set the ground rules for partnership. It must provide clear
and explicit statement indicating the expectations that Government
may have of the relevant stakeholders and urban policy and clear
indications of what powers will need to apply if those expectations
are to be fulfilled.".
121. However, while it is clear that some decisions,
such as those involving their management, should be taken by neighbourhoods,
others should not. The White Paper must clarify which decisions
should be taken by the neighbourhood and which by the local authority,
or regional bodies or central government.
122. The SEU recommended establishing Local Strategic
Partnerships. The Minister told us: "At local level there
would be a local strategic partnership which would bring in all
of the key players to look at regeneration needs across the area
of the authority and to identify priorities".
These could bring advantages, but it is important that they have
the right powers and resources. They should not be a way of sidelining
123. Most witnesses agreed with the Director of the
Government Office for the North East that there should be fewer
They also need to be better co-ordinated. To help achieve this
the Government proposes to strengthen the government offices and
has established a Regional Co-ordination Unit, which will seek
better co-ordination of departmental initiatives. It was set up
following a critical report by the Performance and Innovation
Unit , entitled Reaching Out, and is headed by Lord Falconer
of Thoroton who gave evidence to the Committee.
Matters relating to the new unit which require collective agreement
will be considered by an inter-department Committee of Ministers
which will meet under the Deputy Prime Minister's chairmanship
when business requires. Lord Falconer told us that it was "a
structure at central government level whereby the process compels
the Government as a whole to look across the piece and whether
or not this meets regional objectives".
It is certainly an attempt to deal with a very evident problem,
but we are uncertain about its likely effectiveness. It is hard
to stop Ministers who want to announce new initiatives on the
124. The need to ensure that regeneration initiatives
are undertaken on a wide scale and are well co-ordinated meant
that many witnesses welcomed the New Commitment to Regeneration
and the Task Force's recommendation for Urban Priority Areas and
Urban Regeneration Companies. The LGA, supported by others, advocated
the New Commitment to Regeneration "whereby all agencies
operating in an area deploy their mainstream funds to meet the
agreed regeneration objectives enshrined in a locally agreed strategy"
to achieve better co-ordination of funding streams.
The Task Force proposed strengthening this programme "by
combining government departments' spending powers to deliver longer
term funding commitments for local authorities and their partners.
Central government should be a signatory to local regeneration
strategies to local regeneration strategies where they accord
with national and regional policy objectives."
One of the ways in which Government could most usefully contribute
to this process would be to focus its funding more on out outcomes
rather than outputs.
125. A major recommendation of the Urban Task Force
was the introduction of Urban Priority Areas. These would be designated
areas to "provide a focus for the application of packages
of special measures to help achieve regeneration, and to provide
a basis for integrating physical regeneration with economic and
The Urban Priority Areas would apply "the most effective
set of measures for any given area, avoiding wasted expenditure
and duplicate provision", but they are also "a potential
means of rationalising other area-based initiatives." This
recommendation was widely supported. We were told that the Urban
Priority Areas should be used to "hoover up the various existing
area designations for physical regeneration purposes".
126. In addition the Task Force proposed the creation
of "arms length urban regeneration companies to co-ordinate
and deliver area designation projects".
The Task Force welcomed the fact that regeneration companies had
been established in Liverpool, Manchester and Sheffield but pointed
out that it had recommended that they needed to be equipped with
sufficient powers to do the job in hand and that those steps had
not been taken. We were told that they should have five additional
- Private sector partners should be able to make
contributions to these companies while not being penalised through
the tax system.
- Local authorities should be given more freedom
to operate through these companies without restricting them to
having a shareholding of 19.9% (to avoid financial penalties).
- Registered social landlords should be able
to participate in these companies.
- The companies should work through a spatial
- There should be a system of after care through
a 10 or 15 year period.
127. Witnesses supported these proposals but it is
clear that care must be taken as to how they are constituted.
Urban Priority Areas must not be another local initiative which
duplicates other schemes. Concern was also expressed that it would
be difficult to find suitable personnel to run them. Mr Brown
of the RICS told us:
"In themselves they will not be effective unless
you have a group of people with the right skills, the right resources
who are tasked with making regeneration happen. At the moment
urban regeneration companies are being set up ... it is not clear
to me that these groups of people will first of all be able to
find sufficient numbers of people with the right skills, and,
secondly, would be given sufficient resources and powers from
local authorities and RDAs to get the job done".
An essential feature of the Urban Regeneration Companies
would be the need to allow local authorities to participate in
companies without restricting their stake to 19.9%. This change
should be put into effect at the earliest opportunity.
128. The Urban Task Force also recognised the need
for "simplified assembly of brownfield sites in creating
new development opportunities."
Ms Thomson of the Task Force told us "Some of the rules
around compulsory purchase orders act as a serious disincentive
towards assembling and retaining some of the complex brownfield
sites that are needed for the kind of residential growth that
we need in our urban communities. CPOs for example currently have
a requirement to demonstrate commercial viability which in some
areas we think should be lightened".
The LGA emphasised how helpful streamlining processes affecting
compulsory purchase orders would be. Ms Markham, representing
the organisation, told us "I believe that the CPO powers
we have are old fashioned and their genesis was in the large-scale
housing clearance of the type carried out in the 1960s. There
was a lot of frustration on the part of our private sector partners
who wanted us to facilitate a big development. We had to go through
a tortuous route to use CPO powers for a purpose for which they
were not intended".
The Department has been undertaking a review of compulsory purchase
powers since 1998. We were told "we pick up the kind of recommendations
that came from Lord Rogers' report and of course the report on
popular housing about the ease of land assembly and whether any
assistance can be given to problems there."
It is unclear when it will be published.
129. The White Paper should indicate the role
of each aspect of Government in urban regeneration. In particular,
it should stress that:
- local authorities should "lead the
urban renaissance" by devolving powers and resources to them,
in particular by providing long term funding and giving local
authorities more freedom to raise and spend money;
- local authorities should be permitted to
have a stake of over 19.9 per cent in companies, without any financial
penalties, to enable them to play a significant role in regeneration;
- there should be clarification of the relationship
between local authorities, national Government, regional and sub-regional
institutions; and of the role of regional development agencies,
regional planning conferences , regional assemblies and government
offices in the regions;
- local authorities need to work closely with
local communities, voluntary groups and private sector organisations;
- local strategic partnerships have an important
role to play, but care must be taken in constructing them to ensure
they have the right powers, duties and resources;
- neighbourhoods are important as the key
building blocks identified by the Urban Task Force; measures to
turn round 'neighbourhoods in decline' should be a priority, while
recognising that local authorities will also need to take decisions
on a city-wide basis; and
- there is a need to reduce the number of
area-based initiatives of central Government Departments and get
better co-ordination of them.
1. The White Paper should set out that it intends
to ensure that urban regeneration is well-co-ordinated, carried
out on a large scale and over a long period by:
- strengthening the New Commitment to Regeneration;
- establishing Urban Priority Areas and Urban
Regeneration Companies as recommended by the Task Force, with
the appropriate powers to ensure they do not increase duplication;
Urban Regeneration Companies should employ masterplans to ensure
developments are well-designed.
Government should introduce an improved CPO procedure
to facilitate land assembly. The current review should be completed
as a matter of urgency.