WEDNESDAY 24 JANUARY 2001
RT HON JOHN PRESCOTT, a Member of the House, (Deputy
Prime Minister and Secretary of State for the Environment, Transport
and the Regions), RT HON HILARY ARMSTRONG, a Member of the House,
(Minister for Local Government and Regions), RT HON NICK RAYNSFORD,
a Member of the House, (Minister for Housing, Planning and Construction),
and DR PAUL EVANS, Director, Urban Policy Unit, Department of
the Environment, Transport and the Regions, examined.
1. Can I welcome you to the Committee for
the continuation of our inquiry into the Urban White Paper. Could
I ask you to introduce your team for the record, please?
(Mr Prescott) Yes. First of all, Chairman, can
I start with an apology that I was not able to come here in December.
As you know, I was doing Prime Minister's Questions, so it was
not possible for that. I must say perhaps I have not been as well
briefed as I would like with the bereavement in my family, and
I have the funeral tomorrow, but I have two or three very good
people who know all the answers in these areas and who will endeavour
to give the best answers possible to the Committee. I have, on
my right, Paul Evans, who is the Director of the Urban Policy
Unit in the Department. Of course, Hilary Armstrong, who is the
Minister for Local Government and Regions, who was before your
Committee yesterday. And, of course, Nick Raynsford, who is the
Minister of State for Housing, Planning and Construction. If I
can I would just like to make one or two quick points before we
come to the questioning. The Urban White Paper was published,
of course, within a week or so of the Rural White Paper. That
was because we do believe that the principles apply to both rural
and urban, but you need to apply them in a different way and that
was why we had two separate White Papers. We had some exchanges
on that at the last meeting. Chairman, all the people who live
in these areas deserve good quality services and facilities, and
that is the design of the Urban White Paper, as indeed the Rural
White Paper. They have fundamental similarities but there is a
particular relationship between the cities and the suburbs as
there is between the market towns and villages and surrounding
hinterland. They are the sorts of factors that we have tried to
recognise and are common to both documents. As the Committee will
know, the Chancellor did announce an extra 33 billion a year for
key services, which is the important point of our approach. It
is not just economic regeneration we are concerned about, as indeed
the Committee has often commented on, it is the importance of
the social investment in facilities in both urban and rural areas.
Indeed, that will help people throughout the country. The National
Strategy for Neighbourhood Renewal, which I was launching with
my ministers and, indeed, the Prime Minister a week or so ago
will help people in deprived areas. Those are the areas we are
trying particularly to target. The Urban White Paper is much more
than about money, it is a very comprehensive paper which cuts
right across my Department and, indeed, the whole of Government.
I can recall in previous questions that you were concerned that
we did address ourselves to joined-up Government and delivering
in a more comprehensive way than simply just in a departmental
way. It is our first policy statement about towns and cities for
more than a generation and it is about what we want our urban
communities to look like and how we want to live and it reflects
our long-term commitment to towns and cities and, indeed, takes
on a great deal of the advice that you made in your own recommendations
to us in the preparation for that Urban White Paper. I am grateful
for your Select Committee Report on our Urban White Paper and
I hope you feel that your concerns are properly reflected in that
White Paper. It also follows very many of the recommendations
of Lord Rogers' Urban Task Force, not every recommendation, and
we could perhaps follow that if you like, some we adopted, some
we did not, some we did in a different way, but the broad thrust
of it and the majority of the recommendations we have put into
the White Paper. The new Cabinet Committee on Urban Affairs, which
will see to the implementation of this White Paper, did meet yesterday
under the chairmanship of Hilary. Fully realising the potential
of our towns and cities does depend on partnership. We are spending
a great deal of time and effort in emphasising partnership between
Government, local authorities and other agencies and with local
people. Frankly, without that we admit that we would not be able
to achieve the kind of urban renaissance that we have set out
in our White Paper. I thank you for that opportunity to say a
Chairman: Thank you very much indeed.
2. What plans does the Government have to
now introduce an Urban Bill?
(Mr Prescott) This was, indeed, one of the recommendations
of Lord Rogers. We looked very carefully at it and I think we
discussed it also at the last meeting of the Committee. We have
rather taken the view that we have not accepted that we need an
Urban Bill but that is not to say we will not have legislation.
There were changes that were recommended, for example, on local
authority financing that we will have in the Local Authority Finance
Bill. There are some recommendations about housing that we have
already got and are dealing with in our present Housing Bill.
The transport plans, of course, and the commitment of resources
to the Ten Year Transport Plan again has already been dealt with
in a separate piece of legislation which we have already passed
through the House. All in all we have taken the view that a lot
of the work that was suggested to be in an Urban Bill is done
in other legislation. The other main consideration is we have
set very comprehensive targets in all of these areas and those
targets are the ones that we expect and will be measuring against
and, therefore, that can start now and not be delayed by the period
of a new Urban Bill, and we will want to check it. Within 12 months
we have committed ourselves to the kind of Urban Policy Study
Group Conference that will take place within 12 months and we
have promised a review of all of these activities to be printed
and assessed within a five year period. Putting those things together,
we are not convinced that the way is to go for a separate Urban
Bill. I can tell you from my past experience of the first Government,
it is always difficult getting pieces of legislation you want
and then you are forever criticised by it. I am pleased to see
we are well on the way with different pieces of legislation and
targets to achieve those objectives.
3. Are you confident in these circumstances
that you will be able to implement the very good recommendations
within the White Paper without legislation?
(Mr Prescott) Certainly some of the recommendations
of Lord Rogers when he was talking about the Urban Bill are to
make some recommendations about the financial framework and recommendations,
VAT and things like that which we have discussed in this Committee
before, but they will be the proper preserve of the Finance Bill
anyway. I am confident that the range of things we have got at
the moment will be delivering, and are delivering, and we do not
have to wait for the legislation. I will be judged on that, and
indeed by the examination of your Committee, at the five year
examination we intend to carry out provided, of course, we are
elected at the next election.
4. So you will be back in five years to
tell us how successful or otherwise it has been?
(Mr Prescott) That is a much more difficult question
to answer. Let me say the Department will have that responsibility.
5. If we look at what is going to be the
case in three years' time, what will have changed? If you look
three years down the road, what will have changed?
(Mr Prescott) If you are asking me at this point
in time what changes I thought there would have been three years
ago, I would have thought we would have been advanced in some
areas and not in others, so it is difficult but let me make a
start. If we look at the amount of resources we are putting into
the housing area and for refurbishment, we will get major advances
in there but we want to tie that to a real improvement of the
built environment, which the Committee has constantly been concerned
about. So it is a decent type of housing in a built environment
where the public services are of high quality and it is sustainable,
so we have had to do the planning changes that Nick has been involved
in, things like the housing, the regeneration, the Millennium
Village that we are doing at the moment of a high quality standard
of living. I hope also that we will be able to see an awful lot
more of the brown land in our cities coming on stream and houses
being used on it and less people coming out of the cities because
they do not like living in the city either because the housing
is not available or, indeed, the education is poor or crime is
too high. We have to change those factors to begin that movement
back. I do believe, and our policy will be judged on this, that
more people do want to live in the towns and cities if we continue
to make them attractive.
6. Do you not think as part of that that
it would be sensible to beef up what the powers are as far as
compulsory purchase is concerned?
(Mr Prescott) I think that is a very important
point. Nick is very much involved in the review of compulsory
purchase. It is something that any of us looking at urban development
in towns and cities knows is a very tiresome and difficult problem.
Perhaps Nick could give you an idea of how far we have advanced
on making those changes towards compulsory purchase or making
it more effective for local authorities and private bodies to
be able to do something in the towns where with private properties
there it is difficult to deal with at the moment.
(Mr Raynsford) We have been in very detailed
discussion with the Law Commission about a pretty fundamental
change to the existing legislation affecting compulsory purchase.
It is complex, it is very detailed, and it requires very thorough
analysis if you do not want to end up with legislation which is
unsatisfactory or contains new anomalies. That will take time
and will require a lot of work. In the meantime, we have put considerable
emphasis on helping authorities to streamline the procedures and
to get through the processes with less red tape than sometimes
applies under the current system. We will go on working at that
because land assembly, particularly in urban areas, is important
as a component to regeneration. Helping local government work
together with the private sector to assure assembly of sites located
for regeneration is obviously an important part of that business
of rebuilding confidence in cities.
7. If somebody objected to their property
being subject to compulsory purchase at the present time that
timescale is fairly long and in some cases it takes up to five
years. What would you say that you will be able to achieve on
the basis of what you are going to do?
(Mr Raynsford) You will appreciate that the range
of circumstances are so enormously wide that it would be impossible
to give an average figure because the purchase of one or two individual
properties is usually a very much quicker process than assembling
a large site with a mixed bag of residential and commercial properties.
There is no possible average but it is certainly our objective
to speed the process up while at the same time respecting the
right of the individual to receive proper compensation and, if
necessary, to challenge an unwelcome Compulsory Purchase Order.
8. Can you give me one example of how you
expect to speed this up?
(Mr Raynsford) In the first place by ensuring
that local authorities are familiar with the procedures. A number
have simply lost expertise over the last few years because compulsory
purchase has not been the same part of their repertoire of activities
as it was in the 1960s and 1970s when compulsory purchase was
a fairly common occurrence. One element is ensuring that local
authorities, either themselves or through links with other neighbouring
authorities, have the expertise as to how to deal expeditiously
with the quite complex processes they have to go through. That
is something that can be done on the basis of guidance. Changes
to the law, through our discussions with the Law Commission, obviously
will take longer but that will help to speed things up in the
9. Do you feel that there might be some
problems of compatibility with the human rights legislation on
compulsory purchase, or do you feel that area is perfectly safe?
(Mr Raynsford) No-one in my position would say
that anything relating to the Human Rights Act was perfectly safe
because clearly there are very wide ranging implications. I did
stress that the improvements that we want to see are subject to
proper consideration of the rights of individuals to receive proper
compensation and, if they wish to object, to object to the serving
of a Compulsory Purchase Order. Those principles we are absolutely
wedded to. I believe as long as we do maintain that, that the
approach we are adopting is entirely compatible with the principles
of the Human Rights Act.
Chairman: Thank you.
10. If I can change the subject somewhat.
Does the Government propose to take steps to prevent out-of-town
business parks and office developments and all of these out-of-town
stores we are seeing? If you really mean business as far as the
White Paper is concerned one would expect that you would.
(Mr Prescott) I think if we make the first comparison
with the previous administration as to how many out-of-town shopping
centres there are, there has been a complete collapse in those
kinds of numbers. There has been an unnecessary feeling expressed
in the last few months as to whether other shopping people were
coming in, big store people, and were going to be outside. We
have made it clear that is not acceptable and we have changed
our planning arrangements to make that clear and Nick has been
dealing with that. We do recognise that we are quite prepared
in some circumstances where there may be a mix of housing and
building that we can consider out-of-town. The Newcastle one is
a good example. The Sage computer people, software, wanted to
develop there but they also wanted to be near an airport and wanted
to have the housing. We have been trying to adjust our planning
to make it flexible to meet sustainable communities both with
growth and jobs but not necessarily where it has gone outside
with regard to outside shopping or for development. We have turned
down some difficult and controversial applications for that because
often it is either wrapped up with some other particularly good
project or saying "you must do this to get the social objective"
and people just change those objectives. We have been quite tough
in the application of those planning rules which Nick has been
11. What initiatives are you giving to those
who may not come at all if, in fact, they are not allowed to develop,
particularly on the office side, out of town? Is there any initiative,
any incentive given to those who may be coming from abroad?
(Mr Prescott) For an outside area or a greenfield
area the incentive is very clear there, you try to discourage
them because it works against the objective you want. There are
clear decisions that have to be taken on industrial development,
sometimes which whole communities are dependent upon. One is in
Newbury, the telephone company Vodaphone, who were in 51 establishments
said they wanted to develop in Newbury, but it would have to be
outside the greenfield site or they would go to another part of
the country or to Europe. You have to make a judgment about that.
Our judgment at that time, backed by the planning inspector, was
it made sense to be able to do that, to keep the community in
a sustainable way, both the jobs, in a very big sense, and the
community were kept as one. We have not found it necessary to
offer any kind of incentives. Where I think it becomes a problem
is cluster developments, which is an entirely different thing,
as we have seen in Cambridge and in other areas where you see
research and development. Indeed in the concentration in the Warrington
area, which caused real problems with research and development
there were very difficult questions about location.
12. As far as specifics are concerned, with
PPG 3 and PPG 6 there are provisions there for sequential testing
of the whole question as to the sustainable locations. What plans
does the Government have to provide a similar test as far as office
and business sites are concerned?
(Mr Raynsford) We have no specific proposals.
We believe that the current framework, which generally encourages
development in town centres, is the right approach and that is
one that we have maintained. As you know, PPG 6 has been extremely
effective in ensuring the refocusing of shopping and leisure
development in to town centres rather that out of central locations.
With PPG 3 we are in the early stages, but there is very much
a shift of emphasis towards the reuse of brownfield sites and
development in existing town centres, rather than on greenfield
sites. If we felt that there was a serious problem in relation
to office developments I am sure we would be sympathetic to adopting
a similar formal approach. At the moment it is certainly our perception
that office developments, in general, are focusing predominantly
in urban locations, close to appropriate transport or in business
park locations, which have to be approved through the planning
system. There are proper safeguards against inappropriate developments
out in the countryside. Through the callin procedures, which
we apply quite rigorously, we are able to act against individual
development proposals by companies seeking an outoftown
greenfield and sometimes greenbelt location which is inappropriate.
Our records show that the existing powers are working effectively
to achieve that objective.
13. You will agree, will you not, there
is very little point in ensuring that housing is located in urban
areas when most of the jobs that are around are outside of these
(Mr Raynsford) We agree entirely. This is the
purpose of the policy. The reason that we adopted a sequential
approach and PPG 3 was that the existing policy was not achieving
that result. Our existing policy and powers are successful at
the moment in relation to office development. I said we would
be happy to look at this further if there was evidence there -
it was not.
14. When you say you agree entirely, have
you managed to convince the Department of Trade and Industry that
this policy is right? There did appear to be constructive or,
perhaps, destructive tension between the two departments; is that
(Mr Prescott) Always constructive.
15. Always constructive! What is going to
happen with this new guidance on clusters? Is their view going
to win or is your view going to win?
(Mr Prescott) We were generally agreed when all
departments came together to discuss clusters. When they were
fashionable we had people coming over and saying what they were
doing with clusters in these different countries. To my mind clusters
have been around in economic history for the best part of 100
years. It is not a particularly new theory. What is new about
it is that you plan it as a cluster and the supply industries
come. You make a deliberate planning decision to achieve that.
Some of them come quite naturally. If you look at the motor car
industry around Silverstone, there is a tremendous development
of high technology in a cluster sense. We did not have to do anything
to improve that, although I think the latest application by Jaguar
I am not getting into that wanting to go into the
area, I am not going to comment on that because it will be a final
decision between ourselves and the DTI. The DTI have made some
announcements in the last day or so about encouraging development
in these areas. They may be a bit more sceptical but they do not
doubt it can be a source of growth. We want our Regional Development
Agency to play a part in encouraging that where they can. Yesterday
I was talking to the Regional Development Agency Chairman from
the South East and he was telling me that someone he knew went
to live on the Isle of Wight, he was from Australia but he married
a girl from the Isle of Wight. He had been dealing with compound
materials and he has now begun to produce a kind of material that
the Danish wind farms are using on their propeller systems. They
are building them there, but they have now found that the universities
want to come and develop research. In that sense this is a concept
of clusters. The Regional Development Agency can play a part in
encouraging that, looking at what are the real strengths in the
indigenous economies in the regions and seeking to exploit it.
Clusters can play a part there. We have to leave a question mark
as to whether they are highly successful. Well we can now, they
are there, they have been for a while and they are an important
source of growth.
16. Are we going to be able to get the clusters
on the brownfield sites or are they going to hold us to ransom
and demand greenfield sites?
(Mr Prescott) There are some cases where they
are greenfield sites and they ask for more space, Cambridge is
a classic example, the Welcome Trust. The more controversial one,
as I mentioned, is between Warrington and Oxford, which caused
considerable controversy. We hope they will use brownfield sites,
but that is an argument about making the towns and cities more
attractive, whether it is easier to get in and out on transport,
whether it is easy to get the houses with easy access to. Those
problems are so different from town to town. London's problems
on housing and transport are different than in Hull. We are knocking
houses down in Hull, it is a pity we cannot transfer them directly
(Mr Raynsford) We have made it clear through
our regional planning guidance that this is something which ought
to be looked at through the development of regional plans. In
the first one we have proved for, the East Anglia region, this
has been an important feature, naturally enough with Cambridge
being a magnet for development in the computer software area.
We do think that is the right way for the issue of clusters to
be addressed by the regional authorities working with the Regional
Development Agency to ensure that they are providing for the needs
of business but doing so in a sustainable way as part of the planning
(Mr Prescott) Can I also say, the DTI are publishing
a map of all these cluster sites, I take that as an indication
that they think that it is still important to indicate to the
RDAs. I was struck in Stepney last week, where we were launching
the National Strategy for Neighbourhood Renewal, that there was
a desperate shortage of teachers, there was a skill content of
900 graduates in the Asian community there and no jobs for them.
It means if skills are the essential requirement of any cluster
industry it may well be that we begin to find with certain towns
the skills are not there but not being not employed properly.
That may require clusters to go where the skills are necessary
to meet their demands.
17. You want the Regional Development Agency
to deal with clusters.
(Mr Prescott) To encourage them.
18. You talk about giving them some guidance,
that presumably, is going to be planning guidance. When will that
(Mr Raynsford) It was issued in our Regional
Planning Guidance, which is PPG 11, the guidance which applies
to authorities when they are preparing for regional planning guidance.
I mentioned the East Anglian region as the first one where there
had been development of regional planning guidance and where the
issue was addressed. I expect it to addressed in the other regional
planning guidance as it is developed.
19. But there is nothing more to be issued
by the Government on this?
(Mr Raynsford) No.
20. But some decisions on clusters are taken
nationally, are they not, and this Committee, when looking at
its previous report, identified the importance of concentrations
of university based research and development not to stay in the
South, as they are now, but to move to the North and, indeed,
to the Midlands, yet there is nothing, or very little, in this
White Paper which addresses that issue. Why is that?
(Mr Prescott) The difficulty with clusters is
we do not generate them, we do not pick the winners. We see the
industries and we want to encourage them to develop, and I mentioned
Silverstone and there is the offshore engineering, the electronics
in the Thames Valley, in Cambridge computers. With the one at
Warrington there was this difficulty of a combination of public
and private money where one partner, I think it was Wellcome Trust,
said "we want to be down in Oxford rather than up in Warrington"
and that made it very difficult when quite clearly all the facilities
were there in Warrington. One would like to see the imbalance
perhaps between research and development improved between the
North and South. Some of the monies given by the DTI, and I can
answer for that, has been attempting to put more resources into
research and development to counteract this differential between
the North and South. Whilst we might try to provide the circumstances
for it when you say it is nationally directed, we are not picking
winners, we are encouraging and helping where we can. Where we
do get nationally involved is where a decision is to be taken
and it may require planning, such as Cambridge or those areas
where a planning request comes in, because there are judgments
to be made about the balances which we are involved in. We do
not direct the cluster structure, we try to understand it, we
try to assist and develop it, and we use the RDAs to encourage
and to help.
21. That is not quite correct, is it? In
the case of Daresbury the decision was taken for whatever reason
by the Government, and I agree that Wellcome played a large part
in that, and major funds for research and development are in the
Research Councils, yet the Research Councils do not have any guidance
concerning the regional implications of their decisions in the
decisions that are come to. The decisions appear to be made by
civil servants and scientists without any consideration for regional
implications, and that was the answer I got when I tabled a parliamentary
question on this because if was of great concern to me. Do you
think it is satisfactory for large amounts of what is public money
to be spent in this essential area of research and development
where we know there is a regional imbalance without the Government
attempting to address that issue?
(Mr Prescott) I am attempting to address it.
Can I just say, and perhaps Hilary will want to come in, you are
right in your interpretation and perhaps I did not put enough
emphasis on that. I was trying to emphasise we cannot direct it.
In that case in relation to Wellcome it was a balance of public
and private money and we could have withdrawn ours and they could
have withdrawn theirs and we would have got into this kind of
situation, so in that sense you are probably right. I am trying
to say that I do not think we are directing it, it is very difficult
to do so. If we have a certain amount of public money we should
have a certain amount of input, but I think we saw from the situation
that developed at Warrington that it is not easy.
22. I wonder if the Minister could tell
us what it is you are going to do through your policies to make
(Hilary Armstrong) What we are trying to do is
certainly encourage higher education institutions in the regions
to become much more focused and to build the capacity to actually
develop R&D in the regions. Yesterday when the DTI announced
its £54 million allocation of funding for innovation and
enterprise to the regions, they specifically took decisions which
took account of levels of R&D as well as levels of unemployment
and GDP. Because of that, the two regions that got the highest
allocations were the North East and Yorkshire and Humberside because
they have the lowest levels of R&D in the country. What the
Government is doing is through trying to encourage innovation
and enterprise, which has got to have the involvement of higher
education, which is part of how you attract research and development,
putting the bias specifically towards those regions that do not
have R&D within them at the moment. As I said, the two key
ones are the North East and Yorkshire and Humberside. It also
means that, for example, the North West got more than it would
have if you had simply taken the size of the population particularly
to compensate for GDP per head. In the way that we are working
with RDAs we are seeking to encourage activity in the regions,
particularly in those regions that have not been sustainable because
they have not got R&D because they have had other structural
problems. Obviously this is going to take time. Government cannot
tell companies where to go, they simply up and off to elsewhere
in the world, it is very easy for them to do so. What we have
to do is get the levels of support and activity in each region
up so that they are able themselves to actually get that attraction
of more R&D and more investment that comes along with successful
23. Do you have any plans to address the
issue of spending of massive amounts of public money by the Research
Councils? Would you look at any possible guidance in that which
looks at the regional implications?
(Hilary Armstrong) We do not have responsibility
for the Research Councils but this is something that is taken
into account. As the Regions Minister I frequently discuss these
issues with colleagues across Government and it is an issue that
other ministers are well aware of and are looking to see what
they can do. What they have to be also assured of is when they
make that investment there is going to be the capacity within
the higher education institutions and the surrounding community
to actually develop that. That is why the role of the RDAs is
absolutely critical, because that can be part of that building
24. But there is actually resentment, is
there not, from some academics in some of these parts of the country
who believe that when they put in first class bids that get the
right stars and so on to the Research Councils, for some reason
they seem to go to those traditional universities which appear
to be in the more physically attractive parts of this country?
(Hilary Armstrong) Having once been at the edges
of academia I know how the jealousies and partialities of different
research institutions and so on are seen. What we want to make
sure is that every research institution in every region is getting
not just its fair share but is actually getting the sort of research
that is going to develop into the real opportunities for commercial
exploitation, for the development of other economic activity that
will then grow and develop out from that.
25. With respect, Minister, at what point
do commercial clusters take precedence over the interests of specific
R&D programmes within the regions? A blanket decision to decide
on a regional basis per GDP how much research goes into a region
is not an answer if at the same time you are saying to a commercial
cluster, whatever that is, presumably a group of companies ----
(Hilary Armstrong) I have not talked about commercial
26. Scientific clusters, let us use the
English language precisely, I know how important that is. Can
we just make it quite clear at what point your Department draws
the differentiation because it seems to me that what you are setting
out is a complete dichotomy. You are saying on the one hand that
if there is a cluster it should be allowed to develop because
that is, of course, a way in which since the Government cannot
direct companies, it can only protect companies, we expect them
to develop commercially, but on the other hand you saying that
if people have not had any R&D in the past then we will give
them blanket support across the region based on their GDP.
(Hilary Armstrong) I am sorry if that is how
it appears. That is not what I was saying. What I was saying was
in directing money to Regional Development Agencies the DTI, with
our very full support, has allocated its money for the next three
years for innovation and enterprise on the basis of specifically
trying to feed the early stages in the regions where there has
been least activity and least ability to attract research and
development in the past.
27. So in planning laws you would say where
there is an existing cluster of scientific development that should
be allowed to develop, but where there is a general policy of
R&D because there has not been sufficient put into it in the
past we should encourage by planning laws some development of
that kind in the region? Is that what you are saying?
(Hilary Armstrong) I am saying that what we want
to do is get each region able to sustain high levels of research
and development and the spin-offs that come from that. We, through
our Regional Development Agency policy, are seeking to do that.
That does not mean that we are saying to the South East we do
not want there to be further development and we only want development
in the North East because actually there are some good developments
in the South East that there can be spin-offs from in the North
East. What I am saying is that in the way we work with Regional
Development Agencies we are seeking to support increasing R&D
particularly in those regions where there has not been because
we know that you need that in order to attract particularly some
of the new knowledge economy jobs. The planning issues were issues
that Nick was dealing with and I do not think that he was expressing
it in that way, but I am sure he can speak for himself.
28. Let me ask Mr Raynsford, at what point
does a planning cluster become too large for the region in which
it is being developed? What guidance do you give to the planners
in a particular area as to the line that should be drawn between
the needs, in planning terms, for development of new scientific
industries and the existing interests of "a cluster"?
(Mr Raynsford) The guidance is set out in our
PPG 11, which is the guidance for regional authorities and the
development of regional plans, which I referred to earlier. It
draws attention to the importance of clusters and their economic
significance. It mentions the fact that geographic proximity is
a factor and asks for that to be taken very much into account
in the development of the regional plan. It also stresses, this
is very important, that the plan should facilitate the establishment
and the expansion of innovative cluster areas, but also should
contain transport and other policies to assist the creation of
the necessary physical infrastructure to support that. It is trying
to encourage the regions to think in the longterm about
the necessary arrangements to foster and develop clusters that
may be emerging in their region. It does not address the issue,
which is a wider one, of interregional decisions on the
location of businesses.
29. Secretary of State, if I might ask,
I think it is fairly well accepted that in many of the baron city
areas we have a high proportion of our socially economically poorest
people. From my own small experience of regeneration, and from
a report from this Committee before I came here, the Rogers Task
Force, etc have pushed towards the success being based, to a large
degree, on the creation of mixed communities. Particularly, perhaps,
encouraging the middle income groups back into the inner cities.
I have certainly seen that in London and it has been extremely
successful over the last two decades. What is the White Paper
putting forward to encourage that, if you agree those are key
(Mr Prescott) I certainly agree that the regeneration
programmes did have an effect on inner cities, that is attracting
the people from outside to come back into the cities. I can think
of Hull as a good example where they converted a marina and warehouses
into housing. That is not new in many countries outside Britain,
where you develop a good facility in the centre and people will
come in because it is high quality, a good environment with good
living facilities. That has certainly attracted them in. Our view
is that you do have to do a lot more in regard to social provision,
for example. People are discouraged from living in the city, it
may be because of poor education, it might be high crime rates,
all sorts of things add to the insecurity of living in as city.
A lot more do want to live in cities and not travel from outside
into cities. It is to improve that general environment. I think
the resources that we have in the local transport plans to improve
transport, to have a more sustainable environment, to improve
the education and the Health Service, all of these programmes
are beginning to have an influence in improving the quality of
life and living. It is not just the house, is it? I talk to people
who say, "I would like to live in that area but the schooling
is lousy and I fear to death that I might get mugged", or
things like that. I think that has been true over both administrations.
What we are trying to do is correct some of those by putting more
resources into them. If we make our cities more attractive, whether
it is pedestrianisation, whether it is better housing, whether
it is mixed communities, like the Millennium Estate in Greenwich,
for example, 20 per cent of it is now social, affordable housing
living alongside different social mixes, instead of having one
big estate. If it is done in a good environment, as we see in
the Greenwich Millennium Estate, you can get people to come back
to live in the cities.
30. A major factor, and I suspect you will
agree, of the success of this would be local government working
with you, working in partnership in getting it moved forward.
Local government can make it go or local government can totally
damn it. What would the reaction be were you to find your programme
has been damaged by local government?
(Mr Prescott) Like everything else, there is
good and bad governments and good and bad local authorities. We
should ask for the best value and the best standards for that.
We have spent a bit of effort in legislation, that you have been
involved in yourself, in trying to improve the quality of decisionmaking
and standards in local authorities. Where we found that some local
authorities are not actually doing what we think is the best standard
to achieve that we have been quite prepared to take several measures
out, to intervene with the local authority, to achieve the best
standards, to change the local authority structure in some cases,
a whole range of measure are involved in that. Local authorities
are quite critical to it, I have no doubt about it. We can improve
the quality and modernise it, and my ministerial has been very
much involved in doing that.
31. One of criticisms of the best value
legislation and that aspect of it that you are talking about -
it was effectively supported by certainly two of the members of
the Committee when the Bill was going through - is the difficulty
with it is that it takes too long. It is too long to act, it is
a very slow decisionmaking process, very slow procedures.
How long do you think it would take you to act on local authority
that was impeding action under the best value legislation?
(Mr Prescott) I suspect we are not always able
to move as fast as we can. There are difficulties with every idea,
from compulsory competitive tendering to best value. By making
the structure changes that are now taking place in local government
it should make it easier. Perhaps, Hilary Armstrong, who has been
working on the results we have seen, some good, some not so good,
can reflect on how committed the local authorities are in the
best value area.
(Hilary Armstrong) The legislation on best value
only came into power on April 1st and we have already, through
that legislation, assisted Hackney. We have not taken formal intervention
of powers but what we have done is we have had the inspectorate
in and we have had a return corporate inspection. The problems
have been identified with the support of that authority. We have
sent in through the Improvement and Redevelopment Agency key people
in order to, firstly, find out the extent of the problem and now,
this week, we have agreed to send in financial managers in order
to address that particular issue. It may be slow, but I think
if you remember the problems you had with CCT that has been certainly
as fast as any CCT process, but I think also think more effective.
(Mr Prescott) We are also getting quite a bit
of criticism, it is not necessarily, "Come on, you say best
value, compulsory competitive tender", in some areas they
come along and say, "What is the damned difference?"
I think there is a difference and we are trying to encourage them
to be that. It is not an easy option, but it is making
32. I will continue the other argument on
another occasion. On a related matter, going back to my first
question, when you walk into many of our big cities you wonder
whether they should be bulldozed and rebuilt, so on and so forth,
particularly if you are looking towards attracting middle income
brackets back into the towns. Are you prepared to bring in the
bulldozer into some of these cities and spread it down and start
(Mr Prescott) I will ask Nick to respond to that.
I notice tower blocks have got some attention now, there are about
1,600 of them and ten might be knocked down. We have been knocking
tower blocks down because they were badly built and badly designed,
and we all know that has been the
difficulty. In my constituency now they actually
use the money for the conversion of them and they have redone
them and made them up and they are very attractive. People are
not leaving them. You would not necessarily knock them down, so
it is horses for courses. When I went around that estate in Southwark
a few years ago I think my impression was, yes, I would like to
come in with a bulldozer.
33. I think you will find that we did consult.
(Mr Prescott) Yes, you did consult. We have seen
areas where we have knocked them down, but it is not the total
solution. We do believe you can make changes. It may be that you
have to have less density in housing, less concrete. I am not
a fan of concrete buildings, but a good quality environment shows
in some areas you can achieve a good combination that attracts
people in, both in the private and public sector. Our social mix
is geared to achieve that.
(Mr Raynsford) Could I stress that there are
two separate dimensions but both of which are equally important.
One is the physical dimension. There are some areas where the
physical state of the stock is so bad that the right decision
is to clear it and to start again. That does not mean going back
to the policies of wholesale mass clearance that were adopted
in the 1950s and 1960s and lasted through until the 1970s, which
often destroyed communities. Although they may have created better
housing - sometimes they did not but sometimes they did - they
were usually very damaging to communities. A more selective approach
is removing housing which is past its sell-by date which clearly
has to be replaced but doing it very much with the community in
mind. That takes me on to the second point, which is a sensitivity
to both protecting and preserving existing communities but also
creating mixed developments where people can live together whether
they are owners or renting. The division between areas exclusively
of owner occupation and exclusively of renting, which was very
much a creation of the 20th Century, has not been a happy one
in our view and it has led to social polarisation and social exclusion.
We believe that new developments should contain a mix of housing,
that is very much part of our PPG3 policy, which is why we have
been prepared to intervene where some authorities have not been
as assiduous as they should have been in seeking an element of
affordable housing as part of developments but equally why we
have been quite clear about new affordable housing to be developed
as part of mixed communities rather than creating just ghettos
of social housing.
34. I agree with you that single tenure
social housing in inner cities in the past in many areas was a
disaster. The Deputy Prime Minister mentioned Southwark and Southwark
used to have an extremely high proportion of social housing. Are
you prepared in inner cities, despite the local authorities, to
go beyond just low cost home ownership as an addition to social
housing recognising that if you are going to get the mix that
the Deputy Prime Minister is talking about you are going to have
to get quality housing?
(Mr Raynsford) Yes, and that is very clear in
our Planning Policy Guidance PPG3 which talks about providing
a range of housing to meet a range of needs, different income
needs, and a mix of housing tenure, so there will be outright
owner occupation, low cost owner occupation and affordable rented
35. How is that tackled in the White Paper?
(Mr Raynsford) That is all tackled in PPG3 which
was issued before the White Paper and the White Paper endorsed
the policies which had already been put in place. There was a
bit of a debate about whether we were implementing Lord Rogers'
report. One of the points we made was that when PPG3 was published
before the White Paper, 17 of the Rogers' recommendations were
given effect, or were put into effect, by the recommendations
of PPG3. It is absolutely integral to the White paper and it preceded
36. A New Commitment to Neighbourhood
Renewal, that was launched last week and that really addressed
this area. I think there was some disappointment last week that
there was not any money. Can you tell us any more about this?
(Mr Prescott) Since it was 800 million I do not
know whether you think that is no money but over three years I
think that is a fair share of money and it was certainly welcomed
by them. You are right to point out that the answer is not necessarily
just to go and knock it all down, we can redevelop. I think what
we are trying to do with the National Strategy for Neighbourhood
Renewal is, in fact, to bring those social factors together to
develop it as a community and deal with the very real social factors
about jobs, about education, about health, all those things to
make them more into a living community. What we announced last
week, of course, was £800 million for this neighbourhood
renewal of working areas. That is picking something like 88 of
the worst areas of deprivation that we have in this country and
then to say that these will now be in a three year programme,
although I think it is a ten year involvement but a three year
commitment of resources announced by the Chancellor in his last
statement that the Neighbourhood Renewal Fund would be £800
million. They welcomed the money, of course, they do very much
so in these communities, and the commitments, but what they said
was the way it is spread out it will be £100 million in the
first year, something like £300 million in the second year
and £400 million in the third year and the concern was "Can
we get off to a fast start? Can you not give us a little bit more
money than you have given us there or can you spread it a little
differently?" We listened to what was said about that when
we had the exchanges last week and, indeed, I am able to say today
that there will be an announcement made today for the first time
to this Committee, of course, and there will be an announcement
made to the House today in written form that we have listened
to that and we are announcing another £100 million in the
first year. So that should allow in these 88 areas more money
to get off to a quicker start, so perhaps we can have an even
better response. Instead of £100 million in the first year
starting April 2001 it will now be £200 and it lifts the
overall total from £800 million to £900 million, getting
on for a billion, which is a fair whack of money.
37. Do you think it is going to be spent
in that time?
(Mr Prescott) Hilary has been very much involved
in developing these programmes. You will remember when we had
the New Deal communities, of which there is one in my constituency
in Hull, there was a tendency to say "there is the money"
and that was £800 million over a ten year plan but a three
year commitment on the £800 million, and that was directly
for doing specific things, developing the housing, etc. I know
your Committee has looked at some of the criticism made of whether
we co-ordinate our activities with different departments, with
education, different programmes being done by different departments,
so we had an analysis done of that and thought that it was not
as effective, did not really take into account a lot of these
social provisions and we did not co-ordinate it and did not get
the best effect and there was some confusion. This National Strategy
for Neighbourhood Renewal develops on the Social Exclusion Committee
that has been set up to co-ordinate its development. Perhaps I
can ask Hilary to fill you in on how far we are on that. It is
based on developing local partnership strategies with the community
itself to make those decisions and then it is a matter of checking
how this money is actually used to achieve the objectives and
targets which are set for them.
(Hilary Armstrong) The 88 authorities - they
all know who they are - are setting up what are called Local Strategic
Partnerships and are seeking to use the money with their partners
to achieve what we call floor targets, in other words minimum
standards in every area in terms of crime reduction, improvement
in housing, improvement in educational standards, improvement
in health standards. The money certainly will be used. It is being
addressed as mainstream money because what we want to do, and
this is what the Spending Review came up with, is if we are really
going to turn around our most deprived areas then we have to make
sure that public services in those areas work most effectively.
The new money that was announced last week is money that will
be specifically for community groups to make sure that they are
able to participate, along with the public authorities, the health
authority, the local authority and so on, so that they can really
get their say in the way things happen. Over the next three years
we really want to work hard in those 88 areas. There is a new
Neighbourhood Renewal Unit within the Department being set up
and that will work closely with the 88 areas to actually see how,
through this additional mainstream money, we really can improve
opportunities in each of those areas.
38. Thank you. Is there not a tension between
the Rural White Paper and the Urban one? The more attractive you
make it to live in the countryside under the rural one, the harder
it is going to be to get people to come back into the towns, is
(Mr Prescott) The presumption is that people
want to get out of towns because they prefer to live in the rural
areas but examination we have done on that shows that clearly
people want to move into suburban areas, and that has happened,
but a lot of them have been getting out for the other reasons
I was referring to, that they do not think the quality of public
services in towns are good enough and they want to leave them
or, for example, they cannot get the type of housing they want
in their area so they have sought it outside. To that extent,
therefore, both the urban and the rural areas have this common
problem of many people coming from the suburbs into the cities
and to a certain extent we see some of that economic development
and social movement between the market towns and the villages.
What we have tried to do is say let us work on both. The needs
of the people in the rural communities for housing are as desperate
as they are in some of our cities and many of them are leaving
rural areas simply because they cannot get a house. I think that
is quite an important factor. Social housing in the rural areas
is equally as important a factor as in the cities and towns. One
reason might be about refurbishment, and it varies from town to
town. In my City of Hull there are 5,000 empty houses. Population
movement has made for considerable difficulties in the cities
and no doubt if they move down to London they will find housing
a very difficult thing to deal with. It is horses for courses.
We still need to deal with the provision of social services that
need to be guaranteed in the rural areas that perhaps discourage,
if you like, people who want to live in the rural areas. I do
believe that the majority of people like living in cities as long
as it is a good life, good quality, good built environment, and
if we can achieve that I believe we can affect those flows that
way. I do not think there is a tension between the two but we
need to direct our policies at both those rural and urban. That
was why we did two separate papers and I think that has been generally
welcomed and accepted.
39 You just talked about the number of empty
houses in Hull. You can take that in most of the northern cities,
take Manchester as an example. On the north side of Manchester
you have some Edwardian terraced houses which are identical to
ones on the south side. On the south side of Manchester they are
going for very considerable sums of money, not quite London prices,
the identical houses on the north side of Manchester are unsalable.
They are within ten or 15 miles of each other. Would it not be
a good idea for the government to put some floor into the market
for those sort of properties, so if somebody buys it this year
there is a chance in three years' time they can sell it.
(Mr Prescott) To guarantee the price? I will
leave Nick Raynsford to make a judgement about a floor. I can
see great difficulties with that. Can I just give a response to
15 miles, I think in some areas you can be within a mile or so,
where areas are very attractive and others are not so. If I can
refer you to the Manchester, since you said Manchester, and I
look at the areas that have been developed in the City of Manchester,
they did not want to touch some of the housing, we see a massive
almost renaissance in the bulk of the city centres. There is no
doubt about it, people are flooding back to live in those areas.
The house prices are going, up could have bought something for
ten per cent of that a few years ago. People do want to go if
we provide high quality living for them. Whether it is to be found
in the mechanism, as you are suggesting, I am not sure about the
consequences of that.
(Mr Raynsford) I would be very doubtful about
the government intervening to put a floor on house prices in any
area. In PPG 3 we have put a presumption against new greenfield
developments in areas where there is a brownfield alternative.
In that particular location the impact of PPG 3 should be encouraging
all new development in the brownfield areas and getting empty
properties back into use. Secondly, by targeting money for the
improvement of existing council housing, which we are doing, very
considerable increases and investment, and encouraging new investment
by registered social landlords in regeneration work, we can help
to build confidence in those areas. That will, hopefully, lead
to a rise in house prices over a period of time. Beyond that it
does depend on wider planning policies that make areas attractive.
John Prescott is absolutely right in stressing we will not be
encouraging people to come back unless the wider issues of education,
crime and the quality of life are all addressed. That is what
we are keen to do.
40 I am just suggesting to you that in some
of those areas those problems are being addressed but it is this
fear that if you buy a house in the that neighbourhood and you
cannot sell it in four or five years time, which means that suddenly
a whole area becomes one where people are reluctant to purchase
(Mr Prescott) It is how the area begins to develop.
Can I go back to my own experience in Hull, in the New Deal community
we have there we have a river going through it and it is called
a drain, because it is a flood plain area and it is an effective
drain system. If that was a river going through the centre of
a private estate people would say, "This is very up market".
What we have found since we began to adjust the drain to make
it look like as if there is a river, with trees, etc, an awful
lot of the empty houses are being filled because people want to
live in the area. We have changed the feeling of the environment
and done something about it. That is true whatever it is. I do
think that monies that were announced by the Chancellor in the
conversion of shops, and things like that, and stamp duty and
the conversion money have all helped to improve property in inner
city areas, which does show if you get it right it does attract
people into them.
41 Secretary of State, the two papers that
were published, the Urban White Paper and the Rural White Paper
are welcome and a base to build future planning and the destinies
of authorities. Obviously this is a matter that people take seriously.
Are planning authorities complying with your policy to de-allocate
land identified for housing which no longer meets the requirements
set down by your initial approach? I refer to where there was
land assembly before 1997 and those areas would not now qualify
under PPG recommendations. Are you de-allocating that land for
housing in greenfields?
(Mr Prescott) I am not sure. I wonder if I can
ask Nick Raynsford to answer that.
(Mr Raynsford) The answer is we are taking a
number of very significant steps to affect the change from the
development of greenfield sites to the concentration on brownfield
sites. PPG 3 set the framework. We have issued detailed guidance
to local authorities arising from that, particularly on undertaking
urban capacity studies and managing the release of sites so as
to avoid all of the greenfield sites being seized when there are
brownfield sites available for development. We have imposed a
direction requiring local authorities to notify us of any proposed
developments that involve greenfield housing on a significant
scale. We have already had a significant number referred to us
under that direction. There is already in place a direction which
requires authorities to notify us of any departures from their
plan, where there is a proposed development on a greenfield site
that is not in conformity with the plan. We are answering a question
today which will be giving the detailed figures, and that will
be on the record as from tomorrow, which demonstrates that we
have called in developments proposed, which have been referred
to as under these notification requirements, 20 applications relating
to around 320 hectares of land. I am confidant that the new procedures
are beginning to bite and really will make a difference.
42 How are they monitored locally? Where
there is a borderline case, where the application should have
been rejected but because it was near to before the PPG 3 was
published and it was likely to go forward, how are they being
(Mr Raynsford) The policies are being monitored locally
by the local authority, which is required to look at any development
proposal in relation to its existing plan. Secondly, by the government
office which will, if necessary, serve a holding direction where
there is doubt as to whether a development should proceed. Thirdly,
by our department looking at all of the cases that are referred
to us under the notification procedures that I have outlined.
I am confident that there are good monitoring arrangements in
place and as these policies bite, and they are biting, we will
see the figures proving the change in emphasis and development
43 Secretary of State, you did outline the
importance of urban renewal, the fact that we have to improve
the quality of housing in our areas. The minister did refer to
funding for housing and he referred to council housing, what are
the options for funding for council housing, because there is
a great deal of concern of the situation as it is at the present
time, and fear, in some local authorities, that they are going
to lose their landlords, ie housing authorities?
(Mr Prescott) The biggest challenge for us in
housing at the moment is the need for housing in London, quite
apart from the good quality of it in the south east, whereas in
Hull and some northern areas the population has left us with a
lot of empty houses. The real problem there is how do you deal
with what is estimated to be something like £20 billion?
How do we deal with that kind of rehabilitation and improvement
and reinvestment in property. We made a decision to do that, the
first time it was about £5.5 billion that we put in and then
at a later stage another 2.5 million towards that. We have chosen
to try and deal with that problem by giving former housing investment
to them. Also in the repair programmes, of course, they have had
something like £1.6 billion. I think the point you are referring
to is causing some concern when the local authorities seek to
find other ways of raising money, which started by the previous
administration going to the private sector, coming to some understanding
about it, losing their landlord status and passing the whole thing
over. What we have done is to make clear we are not necessarily
against that, and Nick Raynsford made an announcement to the House
about that when we did the housing paper, we are prepared to do
that. To give the qualification the tenants are going to have
to agree, they cannot have it overridden, they have to agree whatever
it is. We did go a little further in our housing paper, it always
seemed a bit unfair to me that local authorities have a rent income,
all you are doing with the private sector is giving it to the
private company and they make a judgment about the rents as to
whether they can refurbish and recover their investment. Why,
if there is an income flow, local authorities could not borrow
themselves using their income. We gave them an opportunity, Nick
Raynsford will give you more details about that, to be able to
raise the money, remain as the landlord, kind of one removed from
that estate, but still keep their housing stock and use the private
finance to improve it instead of waiting for how much money will
be available from government. If the bill is £20 billion
and if we wait to improve it each year it is going to be a number
of years before you can achieve that. This allows them to do that
on one very important condition, which we come back to, are there
good authorities, bad authorities, bad standards or good standards?
They have to meet certain conditions as an authority in order
to be able to use that facility which does allow the public sector
to retain its landlord role and, indeed, the tenants to have more
say in their decisions and, indeed, hold the right to be able
to make a decision as to whether they want to go through that
way. Perhaps, if Nick could just supplement it.
(Mr Raynsford) There are essentially four options
open to local authorities. Those who retain their stock within
the existing arrangement will benefit from April from the new
major repairs announced, which is funded to the tune of £1.6
billion nationally, which gives each local authority a sum related
to the ongoing maintenance needs of each of their properties.
The figure that has been agreed with the Local Government Association
is very widely seen to be a generous settlement to ensure that
authorities can maintain their stock. Secondly, the arm's length
company option, which the Deputy Prime Minister referred to, is
funded with a further £460 million over the coming two financial
years, sorry not this coming year the two years after that, which
will support those authorities who want to put their housing at
arm's length, who achieve excellence, they will qualify for additional
borrowing funded from those resources. Thirdly, we have allowed
some £600 million for PFI credits following on the successful
pilot projects under which eight authorities explored the option
of PFI in relation to housing. The fourth is the large scale voluntary
transfer option in which we have made provision for transfers
of around 200,000 homes a year if local authorities and tenants
want to pursue that option. The key thing to emphasise is it is
the tenants and local authorities who decided but there are a
range of options and it is all geared to achieving our highly
ambitious target of ensuring the entire backlog of substandard
council housing is brought up to a decent standard within a ten
44 This will impact, will it, on the Cabinet
Committee which is responsible for looking at urban development,
the fact they are going to be looking at estates that need the
face lift, they need money investing in that and it will be part
of the urban development one assumes? Can I turn to the question
of planning now.
(Mr Prescott) I do not know whether that is right.
Could I just enquire about that. The Urban Development Committee
--- We get confused these days because we have the cabinet in
local authorities and we have the Cabinet here. It will be the
decision, of the Cabinet itself in the local authority to make
that decision or the local body as it is. Our resources in this
are additional to what has ever been used in I think the Urban
Development Renewal Strategy. So it does not take any of those
resources. These are additional to that and part of the housing
45 I see. I am just going to refer to planning
and the fact that under the Urban White Paper and the PPG3 that
has been published there is a greater responsibility on some local
planning authorities. What extra funds are being allocated to
planning authorities to carry out the duties and the responsibilities
that the Department is placing upon them?
(Mr Prescott) This was a concern of Lord Rogers.
46 That is right.
(Mr Prescott) Nick, could you answer that.
(Mr Raynsford) Local authority funds for planning
are part of the overall framework of local government finance.
There is not a separate stream specifically ring fenced for planning
purposes. We encourage local authorities to ensure that the planning
service is operated in an efficient way and we do issue guidance
to help local authorities deal with applications in an efficient
and prompt way. I have to say that not all achieve a reasonable
standard. There is an enormous variation in the performance levels
which cannot be explained by workload. We have looked very carefully
at the performance figures and authorities with very comparable
levels of applications achieve fundamentally different turnover
times in terms of the length of time they take to deal with cases.
So we have, under the Best Value Regime, set performance standards
for those authorities who have over the previous two years failed
to meet the target of 50 per cent of all applications dealt with
within eight weeks. Our actual target is 80 per cent to be dealt
with within eight weeks and it is an indication of how far some
have fallen that they have not even managed to achieve 50 per
cent. Those authorities have been notified that they are subject
to a performance standard which will require them to achieve 65
per cent in the coming year. We hope that will both encourage
those authorities to improve but send a message to local government
that it is right that local authorities should deliver an efficient
service and if they achieve the performance of the best it is
well within their capability.
47 I can accept that there should be no
ring fencing of this. The situation is that in local authorities
when they have statutory responsibilities for housing, social
services and all the rest of it, and the allocation for that purpose
maybe four per cent but it is costing six per cent to do it, the
money which should be spent on planning is channelled into other
heads of expenditure. It is unfair to say that where local authorities
have missed out in meeting targets without proper examination
that action is going to be taken against them. I think that matter
should be looked at, would the Minister agree?
(Mr Raynsford) As I said, when we looked at the
figures it was clear that authorities with very comparable workloads
operating in very similar circumstances were achieving radically
different levels of performance. Talking to both councillors and
officers it is quite clear to us that there are different emphases
in the degree of importance attached to planning by different
authorities. We think this is regrettable because planning is
fundamental to achieving in the long term the economic development
of the area. A business that is kept waiting for several months
before it gets a planning permission may decide to go to another
area, so it is counter-productive for authorities to run down
investment or expenditure on their planning side on the grounds
that they have other priorities. It will actually work against
their own interests. We are engaged in discussion with the Local
Government Association about funding and we are not unsympathetic,
but I have to say our evidence is that those authorities who achieve
a high standard do so without the need for additional resources,
they manage their service well, and if others match the performance
of the best performers they would achieve considerable improvements
in their standards.
(Mr Prescott) We tried to prevent, I think, your
general fear, that when we talk about targets it is to almost
determine the priorities for local authorities by saying "that
is your order and you have got to put your resources to meet those
targets". It is always a difficulty in giving resources to
local authorities. What we try to do is to look at the performance
of similar authorities and ask "Why can you not do it there"
and I think that is what we try to do rather than determine the
priority by setting the targets and then making it more difficult
for local authorities or determine their priorities and expenditure.
It is a balance, some are good, some are bad. We want better standards.
48 If I could just follow on, also continuing
with planning and transport. PPG13 has been suggested, it has
been highlighted but not published, why is that, Secretary of
(Mr Prescott) That it is not published? It is
true that we have been involved, I think, in it since 1999 on
this controversial --- It is controversial, yes, because we are
talking about lots of planning requirements, probably the one
about car parking is the one that gets most controversial in it.
It is about transport. Because we have produced our transport
plans and we have extended some of the consultation about it,
it is controversial but you are going to have to make a judgment
about it. We hope shortly to be able to publish the plan. Nick,
perhaps you could say the date of publication?
(Mr Raynsford) The consultation took place around
a year ago. It was a very full consultation with a lot of responses
and, not surprisingly, some widespread differences and opinion
in response to that consultation. So it has taken longer than
ideally we would have liked in reaching conclusions on how we
take this forward but we are at an advanced stage and we hope
to be able to publish in the very near future.
49 What do you call the "near future"?
(Mr Raynsford) How long is a piece of string?
(Mr Prescott) It will be quite near. Can I just
give you one difficulty we have been looking at in this. People
say you want less regulation rather than more regulation and there
is always this balance. Government departments who have the responsibility
of saying there should be less of this naturally say "Are
you not actually making this more difficult in regard to regulation?"
We have to say it is important in the planning and the kind of
environment that we get a proper standard. So do you actually
make it a recommendation or do you make it a standard that you
have to implement in your plans? That is controversial not only
outside but sometimes inside Government.
50 Can I look forward to it in the near
(Mr Prescott) Pardon? I tell you, I will write
to you about that.
51 Thank you very much.
(Mr Prescott) I will write to the Committee.
52 When will you have agreed a replacement
for Gap funding of the European Commission?
(Mr Prescott) This is a very difficult one. It
concerns us a great deal. Hilary has been very much involved in
negotiations. It affects right across many of these programmes,
as you well know. Hilary, can you tell us where we are on that
because some countries in Europe certainly agree with us, there
is a lot of discussion going on with the Commission, but it has
had an effect on a number of the programmes as you know already.
(Hilary Armstrong) I can tell the Committee that
the Commission have informally indicated that they have approved
the Direct Development Scheme and written confirmation is due
imminently. Once it has been received RDAs will be able to begin
operating that scheme. As you know, there are two other schemes
that we submitted to them, the two Gap funding schemes and whilst
it is always risky to give a specific date when the Commission
is involved, nonetheless they have said we can expect a decision
on the schemes by the end of February. They have recently approved
two schemes from the Welsh Development Agency that are very, very
similar and so we do not anticipate that there are going to be
any problems and we see no reason why they should not be approved
by the end of February as indicated. The other two schemes that
we have proposed to them, Neighbourhood Renewal and Environmental
Regeneration, are still being considered by the Commission and
again we are pressing them for early positive responses.
53 How will this affect the 32 schemes from
the Merseyside Objective 1 programme which are currently in the
State Aid Unit of the Department of Trade and Industry? These
are essentially schemes with private sector involvement which
have been held back for the same reasons as the reasons for the
cancellation of Gap funding. One of those schemes is a Beatles-themed
hotel in Liverpool, the other is a business centre in Toxteth
and I understand there are great difficulties about the private
sector elements of those schemes waiting, what I was told only
this afternoon, would be several months before those schemes could
proceed. How will the statement you have just made relate to those
(Hilary Armstrong) I obviously do not know the
detail of those schemes and I do not know whether these schemes
link into the criteria which we have applied for the schemes that
we have sought approval for. The RDAs do know the criteria, the
shape of those schemes. The public knows now because the Welsh
Development Agency programmes, as I say, have been approved. The
Gap funding schemes will be ones that are applicable certainly
in the Objective 1 area because they are specifically for those
areas. I do not know those individuals schemes, but if they have
been prepared knowing that the earlier Gap funding scheme is not
possible and they have been prepared within the remit that there
is this time, then they will be acceptable. If they involve direct
development, they will be acceptable. However, as I say, the individual
programmes will have to be assessed alongside the new overall
programmes that we are submitting and seeking approval from the
54 I am a little concerned because your
answer suggests that those are not of any particular concern to
you. Those schemes were worked up by the Government and the Government
Office, they are not the responsibility of the Regional Development
Agency. Could I ask you to investigate that programme
(Hilary Armstrong) I am really sorry.
55 --- A major part of the European Objective
1 programmes. Those schemes were put together before the Gap funding
ruling and discussions have been taking place ever since. Could
I ask you to look at those? I have been pursuing this elsewhere,
as you are aware, and these are major issues for regeneration
(Hilary Armstrong) Of course they are and I am
not taking this lightly at all. As you know, I have been pursuing
this fairly vigorously for some period of time. What I do not
know is the individual details of those schemes, that is all.
I am putting my hands up and saying I do not know the individual
detail so I cannot give you an answer which deals with that, but
I know that people are looking at that very carefully. Yes, I
should have said that the Government Office as well as the RDA
are very involved in all of this, and certainly I will have another
look at it. What we have been trying to do all the time is to
make sure that whatever proposals we have we see how they can
be adjusted to fit within new rules.
56 Why do you think it was that the Welsh
Development Agency and the Welsh Assembly were able to find a
solution to the problems of regeneration in Wales sooner than
central government was able to find a solution for problems in
the North West region?
(Hilary Armstrong) They withdrew the Gap funding
scheme earlier. They just decided they were going to move earlier,
that is all.
57 Could I turn
(Hilary Armstrong) I was criticised last time
for having moved at all.
58 So devolved governments move quicker,
earlier and more effectively than central government?
(Mr Prescott) That is not necessarily so, not
even by the evidence.
(Hilary Armstrong) They simply took the decision
earlier. They may decide to put their hand up earlier, that is
59 Could I turn to the question of the Urban
Regeneration Companies, like Liverpool Vision. What powers do
the Urban Regeneration Companies have which distinguish them from
any other partnership such as the Single Regeneration Budget partnerships?
What makes them different?
(Mr Prescott) Hopefully in Liverpool you saw
the differences (inaudible) is involved in the one and
of course the other one now being advocated is the kind that the
Heseltine innovations played some part in, but the fundamental
difference, of course, is that a criticism was made by Committees
in this House that just dealing with this as an economic problem
is not a satisfactory way of dealing with urban renaissance, you
have to deal with social investment. Of course, the Urban Regeneration
Companies involve the community and not simply the local authority
or one body that is basically the Government taking consultation
and that is one of those differences. We now have the ones in
Liverpool, Manchester, and wherever it is. Hilary, would you be
able to give a more definitive response?
(Hilary Armstrong) An SRB largely deals with
one community. The Urban Regeneration Company is covering a much
wider area and is looking specifically at brownfield sites that
need development which very often in the past would be developed
without any consideration of the context that the Urban Regeneration
Company is operating within or the development would be operating
within. What the Urban Regeneration Company has been able to bring,
and this is certainly what people said in Liverpool when I was
there, is that they are able to think about development which
will be of better quality and so on because it is not spec development,
it is not somebody coming in quickly because nobody else is around
and watching. It actually is how do you get a strategy which covers
more than one site, but that means that what you develop on one
site actually feeds into the overall development that you are
looking for. I think in that way certainly Urban Regeneration
Companies are bringing that added perspective which, when you
are looking at the development of a single neighbourhood, you
get in very different ways.
60 The Rogers Report recommended that the
Urban Regeneration Companies have more powers. You seem to have
rejected that. Could you say why?
(Hilary Armstrong) We did because those powers
in many ways intervene with the powers of local government and
there were lots of criticisms of the Urban Development Corporations,
the previous vehicles, precisely because they interfered with
the planning powers of local government, and so we believe that
rather than take those powers again from the local government
and give them to URCs we should look for a more partnership approach
involving the local democratically accountable body, making sure
that they still had those overall planning powers. That will be
a matter of judgment. We are looking at this very carefully. There
is real enthusiasm in the rest of the country to set up URCs but
we are watching that and monitoring it and talking to the URCs
at the moment about whether they think the vehicle is sufficiently
(Mr Prescott) That accountability issue is a
real issue in Liverpool. When we came in with all the bankers
and the businessmen they picked out the economic projects but
there was not a great deal of accountability for that. Lord Rogers
has gone somewhat further than that but at the end of the day
it is still an issue of accountability. Where it is public money,
elected representatives should have some say in it. We tried to
mix it in the strategies by bringing in businesses and different
communities into these partnerships.
61 Can you tell us whether you have defined
the areas that are going to be exempt from Stamp Duty yet?
(Mr Prescott) No, I do not think we have.
62 How soon?
(Mr Prescott) You have caught me. Can I write
to the Committee?
(Hilary Armstrong) It is a matter for the Chancellor.
(Mr Prescott) That is obviously the answer I
should have given automatically, in time for the Budget, but I
will gee it up and make sure and write back on that. If it is
just the line "wait for the Budget", well, we are nearly
63 What about harmonising VAT rates on refurbishment,
is that a dead duck?
(Mr Prescott) The same answer really. When I
appeared here before I said I was an advocate of trying to get
a better situation on VAT, as you well know. We made some steps
towards it and we will keep on pressing the issue.
Chairman: On that note can I thank you very much
for your evidence.