SIXTEENTH REPORT
The Environment, Transport and Regional Affairs
Committee has agreed to the following Report:—
The Implications of the European Commission
Ruling on Gap Funding Schemes for Urban Regeneration in England
INTRODUCTION
"They do understand the scale of
the impact of what they have done now but they do not see that
as their problem".[9]
1. On 22 December 1999, the Commission of the European
Communities took a decision which threatens seriously to undermine
urban regeneration in England. It declared English Partnerships'
Partnership Investment Programme to be illegal on the basis
that it contravened the state aid rules since, the Commission
argued, it offered an 'economic advantage' to the developer. The
UK Government closed the programme to new applications from that
date.[10]
The closure of the programme has severe consequences for the regeneration
of cities and brownfield sites and it is a body blow for the Urban
Renaissance. The Commission appears to have been oblivious to
these consequences when it made its decision. We became very concerned
about the decision, after hearing evidence during our inquiry
into the Government's Proposed Urban White Paper. We then held
informal discussions on the subject with officials at the European
Commission in Brussels and with officials from the Department
of the Environment, Transport and the Regions (DETR) and English
Partnerships.[11]
Following these meetings, we decided to hold an inquiry into gap
funding, addressing the following terms of reference:
- the contribution that
gap funding has made in regenerating derelict and other difficult
sites in areas of 'market failure';
- the consequences of the European Commission
ruling for urban regeneration;
- what alternative schemes should be considered
to replace gap funding;
- the scale of public funding required to enable
alternative schemes to produce equivalent results; and
- what provisions should be contained in a new
regeneration framework.
2. In response to our invitation to submit evidence,
we received 23 written memoranda and took evidence from eight
organisations over two sessions. We appointed David Lunts as specialist
adviser and are grateful for his advice and assistance.
9 Q27 Back
10 DETR
Press Notice 1241, 22/12/99 Back
11 See
Annexes 1 & 2 Back
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