Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Memoranda

Memorandum by National Housing Federation (HOU 38)

  The National Housing Federation represents nearly 1,400 independent, not for profit social housing providers in England. The Federation's members include housing associations, co-ops, trusts and stock transfer organisations. They own and/or manage more than 1.8 million homes provided for affordable rent, supported housing and low cost home ownership, and deliver an increasingly diverse range of community and regeneration services. The large majority of the Federation's members are registered with the Housing Corporation. The Federation welcomes the opportunity to submit evidence to the Urban Affairs Sub Committee's Effectiveness of Government Regeneration Initiatives Inquiry.

  The Urban Affairs Sub-Committee and the ODPM Select Committee are undertaking three major inquiries that are core to the future work of housing associations and housing providers generally. Whilst the inquiries are interlinked, there are clearly discrete issues that the Committee wishes to explore. Each issue is important and warrant the inquiry called, but the Federation believes that there are common policy themes that bond the three, which are as follows:

    —  a fair, rational and transparent allocation process;

    —  planning for mixed, balanced sustainable neighbourhoods; and

    —  decent neighbourhoods: management and renewal.

  In the text that follows, evidence is submitted on the specific questions asked, in the context of the three broad themes set out above.


    —  Mainstreaming regeneration for disadvantaged neighbourhoods will require the harmonisation of bidding criteria, monitoring, timetables for funding, for current and future Government regeneration initiatives.

    —  The effectiveness of government regeneration initiatives can be sustained if an appropriate forward strategy is developed, resourced and implemented.

    —  Community regeneration initiatives require time to work and a flexible funding and monitoring approach from Government.

    —  Housing associations play a key role as intermediaries in supporting and sustaining area regeneration initiatives.

    —  Measuring the success of regeneration initiatives should focus more on local outcomes, and less on scheme outputs.

The contribution of area-based initiatives to broader regeneration initiatives and regional strategies

  An area-based initiative (ABIs) is one of a small number of tools that can help deliver regeneration initiatives and regional strategies. ABIs tend to be designed to effect a significant change in a defined area with the intention of making a sustainable difference to the people who live and/or work in the area. Such initiatives can focus on one or more themes, such as health, employment, housing, and education, with the intention of delivering measurable outputs. These in are intended to derive outcomes that are sustained without future special support. Large-scale ABIs attempted in recent years include the Estate Action; Single Regeneration Budget; Housing Action Trusts; Estates Renewal Challenge Fund; and the New Deal for Communities programmes. Smaller scale initiatives are now being piloted, such as the Neighbourhood Management Pathfinder and the Neighbourhood and Street Wardens Programmes, although these are more focused on improving the management of places, rather than specific themed outcomes.

  The Federation believe that the area based initiative approach is a vital tool for achieving broader regeneration initiatives and regional strategies. We expect the new Housing Market Renewal Fund to make a great difference in the pathfinders areas already identified. Regeneration initiatives often involve delivery in geographically defined areas, in order to give the initiative focus and relevance to the people who are meant to benefit. Whether ABIs can contribute to regional strategies has yet to be proven, given that strategies are still in their infancy, as is the regional agenda itself. Area based approaches will be at the cutting edge to any delivery process that follows from strategies adopted by regional bodies, such as Regional Development Agencies and the proposed Regional Assemblies.

The characteristics of successful regeneration schemes

  The core characteristic of a successful regeneration scheme is the successful delivery of outputs identified in the delivery plan, which is followed by a successful, more widely beneficial outcome. For example, if the regeneration scheme were focused on improving the skills of young people for work in a given area, in the context of a vision for low unemployment levels, and both objectives are achieved, then this would and should be considered a successful regeneration scheme.

  Difficulties arise when a comprehensive approach is required for a disadvantaged neighbourhood where a number of deprivation factors exist. The Government's Social Exclusion Unit identified five core strands. Failings on:

    —  employment and economies;

    —  education and skills;

    —  health;

    —  community safety; and

    —  housing and physical environment.

  These were seen as common to most disadvantaged neighbourhoods. Other factors that served to compound such disadvantage were identified by the SEU, including poor public service provision, the exclusion of black and minority ethnic communities, and poor transport infrastructure.

  Whilst successes have been generated from the comprehensive regeneration approach, some people who have successfully joined the employment market and become financially empowered, choose to leave the disadvantaged neighbourhood. This can cause the "perverse" effect of a successful regeneration output, but a neighbourhood further disadvantaged by the outcome of the loss of an economically active household. Evidence for this trend was identified in research published by the DETR entitled A Review of the Evidence Base for Regeneration Policy and Practice (2001).

Involvement of local communities

  The involvement of local communities is now recognised as an essential prerequisite to an area based initiative (ABI). Previous initiatives such as the Estate Action and the successor Single Regeneration Budget programme rested on bids being developed at relatively short notice. The new approach rests more on strong community involvement in the process before scheme approval is granted. The New Deal for Communities is one example, where community involvement in the assembly of the delivery plan was central to the success of the partnership's bid for resources. A similar approach has been developed for the use of Neighbourhood Renewal Fund resources, influenced by Local Strategic Partnerships. The Federation supports the full involvement of local communities in regeneration schemes as it helps to ensure the sustainability of the investment. The issue of Regeneration that Lasts was researched by Geoff Fordham and is commented further on in the Federation's evidence. In the context of a housing-based regeneration scheme, it is crucial that there is an appropriate management structure—preferably one focused along neighbourhood lines—in place to sustain the investment made.

Democratic accountability

  Recent approaches to regeneration have focused on the need to include stakeholders and community representatives more closely in the regeneration decision-making process. There has been a stronger focus on community empowerment and capacity building in order to improve the exchange of information between communities, elected representatives and professionals. There has also been support from Government for a stronger role for non-local authority representatives on regeneration partnerships, particularly for "hard to reach groups". This is especially relevant where black and minority ethnic communities are disproportionately represented in disadvantaged neighbourhoods. Support for this approach is strongly stated in both the final National Strategy for Neighbourhood Renewal and subsequent guidance for Local Strategic Partnerships. Whilst greater pluralism in the decision making and consultation processes is important, a consequence of this is likely to diminish the primacy of municipal decision making. However, the emphasis must be on getting the balance right to facilitate both effective community participation and the delivery of local authority strategic priorities.

Whether and where area-based initiatives have brought about sustained improvements to deprived communities

  It is difficult to test whether an area-based initiative has been successful, unless the scheme outputs are relatively easy to define. The Review of the Evidence Base of Regeneration highlighted organisations such as English Partnerships and the Urban Development Corporations being successful in their regeneration work, because they were set up for quite specific land and property-focused regeneration purposes. Those partnerships that have been established to deliver people-focused outcomes, sometimes in a community regeneration context or focused on a particular theme, eg, jobs, health, childcare, etc, have a harder task in evaluating their own effectiveness. Inevitably it is very difficult to understand fully, and monitor closely, the causal link between investment in people and the outcomes that may follow.

  The ODPM-based Neighbourhood Renewal Unit is investing in an evaluation process of the New Deal for Communities Programme that should generate a better understanding of what works in neighbourhood renewal and regeneration. Similarly, over £28 million is being invested in generating better information on disadvantaged neighbourhoods in order to allow local partnerships to make more informed decisions in the future on what kind of ABI should be undertaken where. It will be crucial that the work being undertaken is disseminated as widely as possible that practitioners, with or without access to ABI resources, have access to better and new information that becomes available.

What arrangements need to be put in place at the end of a regeneration initiative to ensure that benefits to local residents continue

  A report published in 2000 by the DETR Regeneration that Last highlighted the importance of resident involvement in successful estate regeneration schemes. The sustainability of regeneration projects depended each of the following four factors:

    —  Decisions to intervene should follow a rigorous options appraisal process that takes into account demand as well as need.

    —  Physical improvements by themselves will rarely lead to sustainable regeneration of disadvantaged estates.

    —  Regeneration schemes that do not reflect the wishes of tenants are unlikely to endure and it is important to involve all tenants in this process, including young people.

    —  Multiple deprivation requires multiple solutions, which cannot be delivered through a single body: multi-agency long-term commitment is a precondition for sustainability.

  The Federation supports this analysis and believe it relevant to present and future approaches to the regeneration of disadvantaged neighbourhoods, whether on estates or mixed tenure areas.

  Area-based initiatives (ABI) tend to be created to deliver a range of themed outputs, over and above that delivered through mainstream service delivery in the area, and be time-limited in its activity. A recent trend has been a requirement for a strategy to be developed to sustain the outputs and outcomes delivered, after the intervention has been completed. One perceived failure of past approaches to regeneration programmes is the lack of "exit" or "forward" strategies to accompany the delivery plan. The means to achieving this will be focused on "mainstreaming" any approach required after the ABI has completed its programme. This does depend on a number of variables that are very difficult to plan for. Financial capacity is a key factor for organisations such as local authorities and housing associations that have a responsibility for the well being of an area and its inhabitants.

  Crucial to the sustainability of regeneration successes is the presence of locally-focused organisations at neighbourhood level that are sensitive to the community's aspirations. They should facilitate and offer community leadership, and champion the neighbourhood's needs at local authority/local strategic partnership levels, and higher if necessary. Some of the Federation's members are actively involved in undertaking this role, and we believe that such organisations will be crucial to the future success of disadvantaged neighbourhoods that are currently subject to ABI approaches. This ability to sustain housing investment and regeneration initiatives rests on sufficient funding, which historically has generated from external sources such as the Estate Renewal Challenge Fund (ERCF) and Single Regeneration Budget (SRB) programmes. Both of these funding streams were used to support three stock transfer organisations featured in Beyond Bricks and Mortar published by the Chartered Institute of Housing in 2002, highlighting the ongoing work of Partington, Poplar Harca and Optima Community Housing Associations in delivering and sustaining housing and community regeneration initiatives.

  Whilst there was no clear explanation for the demise of either the SRB or ERCF programmes, the Federation believes that there is certainly a need to create a new "dowry" programme that supports a stock transfer process. This is particularly needed where housing stock has a negative valuation, and community regeneration outcomes are needed. The Federation in its submission to the Treasury's Spending Review recommended that a new fund be created to resource stock transfer up to the cost of £250 million per annum for the Spending Review period to March 2006. The ODPM is currently undertaking a review of how the decent homes standard is to be delivered by 2010, and the Federation believe that a new fund to facilitate future stock transfer programme should be seriously considered.

Whether policy has taken account of long-term impacts as well as the outputs created

  There is acknowledgement from Government that regeneration approaches should be more geared towards outcomes—the overall impact of the initiative—as opposed to the outputs that are traditionally set out in delivery plans. However, this has not constrained the Government setting onerous Public Service Agreement floor targets in successive Spending Reviews that are output orientated. It does appear that the government has a strong rhetoric in favour of community-based, bottom up approaches to regeneration, but is simultaneously committed to delivering targets that are derived centrally. To complicate matters further, the Government's Urban White Paper also focused on "liveability" measures—ie, outcome derived—as appropriate indicators of quality of life in towns and cities. There is a strong case for centrally determined PSAs to be less specific, to allow other agencies—Local Authorities, Local Strategic Partnerships (LSPs), Regional Development Agencies—to have more flexibility in determining local priorities. LSPs in particular have a crucial role to play.

Whether initiatives have had an impact on the major government and local government programmes

  There is a consensus amongst government and non-government agencies that neighbourhood disadvantage, and broader sub regional decline, must be tackled "in the round" rather than through specific thematic approaches. The new focus on improving social, economic and environmental well-being is symptomatic of this, with the new community strategies geared towards improving both people's livelihoods and the places they live.

  The main barrier that prevents wider use of ABIs to be rolled out on a national scale is primarily cost. Currently, the Government is committed to funding 39 New Deal for Communities partnerships up to £2 billion over 10 years, a few years of which have already passed. Whilst there is not a specific figure on how many disadvantaged neighbourhoods there are, there is a consensus on between 2,000 and 4,000 such places in existence. Taking 3,000 as an average, with each neighbourhood gaining £50 million over a 10-year period (an NDC benchmark), this would require a commitment of £15 billion per year over 10 years. Aside from the unlikelihood of the Treasury granting such resources, it is unlikely that there is sufficient capacity within the regeneration industry, local authorities and the various other sectors and agencies, to deliver the time and effort required for comprehensive regeneration. These crude assumptions also depend on required leverage from other funding sources.

  A comprehensive approach must rely on broader approaches particularly mainstream service delivery and other approaches to regeneration such as welfare to work strategies and development-led initiatives, such as those facilitated by Regional Development Agencies and English Partnerships. Mainstreaming regeneration for disadvantaged neighbourhoods will require the harmonisation of bidding criteria, monitoring, timetables for funding, for current and future Government regeneration initiatives. A crucial element of both the Government's National Strategy for Neighbourhood Renewal and their broader modernisation agenda is focused on the delivery of public services in disadvantaged neighbourhoods, and the rationalisation of area based initiatives. The theme of "bending" mainstream resources and services to deliver regeneration outcomes appears to be the core element of the Neighbourhood Renewal Unit's own forward strategy. The subtext to this approach is on better, integrated service delivery at the neighbourhood level. This however will not address the impact of urban and/or post-industrial decline that many places in England now suffer from and major interventions will continue to required.

  The Federation welcomes the Government's (and Select Committee's) support for the Housing Market Renewal Fund (HMRF) announced in the Spending Review 2002. More detail is awaited on the resources available and the process followed to release them. The success of the HMRF approach will be dependent on harnessing both capital and revenue expenditure in areas requiring regeneration, considering in tandem the full range of services and amenities that people need and want. Lessons learnt from the early experiences of the "New Tools" pilots and five Housing Regeneration Companies must also be drawn. Information on these Housing Corporation-funded initiatives should be fully disseminated amongst the nine pathfinders, and the recently announced network for pathfinders will be the ideal conduit for such dissemination.

  The theme of planning for mixed, balanced sustainable neighbourhoods is particularly relevant in this context. Mapping need and catering for aspiration will be the balance that the nine pathfinder partnerships will need to strike. Each of the nine is currently assembling a "prospectus" for their area setting out their vision for the future. Successfully undertaking this task will be dependent on dedicated resources beyond those to be announced in the post Spending Review 2002 announcement, which is likely to detail HMRF resources up to 2006.

Whether lessons have been learned from previous initiatives like city challenge, and applied to new regeneration initiatives such as the New Deal for Communities and Local Strategic Partnerships

  Initiatives such as City Challenge and the many other initiatives that have preceded and succeeded it have been criticised as being too "top down" in their approach to regeneration. They have been similarly criticised for being too focused on bricks and mortar, and consequently not focused enough on people. The move towards more community-focused approaches to regeneration such as the New Deal for Communities programme is welcome. However, the switch to such approaches may have been too swift for some places where there is little or no community infrastructure, which can take some time to facilitate and develop. With the lack of progress that can accompany the time associated with community capacity building, frustration on all sides can build up with the process itself. The New Deal for Communities programme is reported to be behind schedule and under spending its resource allocations. This may be more to do with unrealistic expectations of early progress as opposed to failures associated with the process itself. Timetables for delivery should be more flexible, and bureaucracy, that can stifle community enthusiasm, should be kept to a minimum.

How the government should decide when to introduce an area-based initiative and whether there are successful alternatives

  The Government has committed itself to both reducing the number of regeneration funding streams (NSNR 2001) and also decentralising decision-making for ABIs to regional and local strategic partnership level. Ensuring that resources reach the regional, local and neighbourhood level and are being used effectively and efficiently to meet government public service agreement targets is the key issue, not whether an area-based initiative should be created. The process by which these resources are allocated should be fair, rational and transparent. In future, national area-based initiatives should be created sparingly, with more trust given to regional and local agencies to create approaches appropriate to their own environment. There is a consensus that the number of ABIs and the funding streams that are usually attached to them should be reduced. However, given the scale of disadvantage that exists, it is unlikely that the government will be able to "mainstream" the scale of resources necessary, requiring the continuation of area based approaches for the foreseeable future. The creation of the Housing Market Renewal Fund supports this argument.

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Prepared 28 October 2002