Select Committee on Transport, Local Government and the Regions Nineteenth Report


The Transport, Local Government and the Regions Committee has agreed to the following Report:


Conclusions and Recommendations

Successive urban regeneration programmes have overlooked the needs of the New Towns By 1992, the New Towns had been de-designated by Central Government and were no longer recognised as a separate and identifiable policy area. This de-designation occurred prior to any audit of the regeneration needs of the towns being implemented. The focus on the regeneration of New Towns has, as a result been piecemeal with the level of regeneration investment being partly a function of the region within which they are situated. For example, Halton has been in receipt of Objective One resources since 1994 by virtue of its connection to the Merseyside conurbation. Similarly, an urban regeneration company in Corby has been supported by the RDA in the East Midlands because of the town's profile in a relatively affluent region. Skelmersdale in contrast, has fared less well in respect of regeneration policy as has South Telford, by virtue of their location adjacent to much larger areas of deprivation.

The Public Policy Framework

The public policy framework applied to the New Towns has been underpinned by the principle that the Treasury should receive a substantial benefit from any uplift in values on publicly owned land that was originally purchased or developed through Central Government subsidy. This policy has been implemented through English Partnerships which has between 1999 and 2001 invested 120 million in the New Towns and raised approximately 600 million in capital receipts. This continued process of asset and land disposal builds on a significant programme of property disposals between 1980 - 1999, which repaid all of the outstanding debt relating to the development of the Towns. The Government is therefore now accumulating a considerable capital windfall in respect of the New Towns, whilst reinvesting only 20 per cent of receipts in these localities.

The key differences between the public policy framework for New Towns and other urban areas can be summarised under three headings; Planning, Finance and Regeneration.


Historically, a substantial amount of development land within the New Towns has been owned either by CNT or English Partnerships. Local Authorities have therefore, been unable to develop proactive local planning strategies supported by S106 planning agreements. Additionally, the planning consents relating to development sites have frequently been determined by the original New Towns or subsequent residuary bodies. This situation has militated against the development of a spatial development framework which is locally accountable, and has reduced fee income from the administration of the planning system to the local authority.


During the two decades from 1980, there was a significant reduction in real terms in Government capital investment in infrastructure. To balance this reduction in capital allocations, there has been an emphasis on local authorities setting up public and private sector partnerships to fund regeneration activity. However, in the New Towns this role was stymied by the pattern of land ownership and the fragmented planning system which applied in these local authorities.

In addition any land, which had been developed by the New Town Development Corporation that was subsequently redeveloped, is subject to claw-back provisions at a rate which reduces by 2 per cent a year. This claw-back prevents the local authority in the New Towns exercising their enabling function and places them at a serious disadvantage compared to other local authorities with similar regeneration needs. A similar issue exists in respect of the income from Right-to-Buy housing sales where a proportion of the receipts are currently payable to English Partnerships to reflect Central Government's original investment in the construction of the property. This is an anomaly, as council housing generally was constructed using Central Government subsidy and no other cohort of local authorities is required to return value to the Treasury in this way.

Regeneration and Management

The development of effective regeneration strategies has been hindered by the financial and planning issues highlighted above. However, these factors have been exacerbated by the increasing obsolescence of the infrastructure which requires direct intervention by the public sector to facilitate change.

Fragmented ownership is a key feature of the original New Town housing estates which were often constructed using non-traditional methods on a Radburn layout. These estates were designed for single ownership and unified estate management, but fragmentation of ownership was caused by the asset disposals policies in the 1980s and early 1990s when properties were subject to substantial discounts and sold both to sitting tenants and through the open market. In many cases these estates are predominantly owned by marginal owner-occupiers and private landlords and, because of high turnover and the estate design and layout, they are becoming increasingly difficult to manage.

Urban management strategies are needed to address some of the issues which have arisen as a result of the previous asset disposals policies. These strategies need to reflect the higher costs of environmental maintenance and enforcement associated with semi privatised estates which were constructed initially for one managing agent. The Government should deploy the skills of the Neighbourhood Renewal Unit to assist and resource strategies to stabilise these areas and improve the quality of life for residents.

Decisions about the assets of the New Towns are being made in a strategic void. The New Towns have had successes and have generated a financial surplus for the Treasury. However, they have significant regeneration and reinvestment needs which are not being addressed by central Government. Without a significant policy change, the legacy of this altruistic 20th Century planning initiative may be transformed from a series of projects that have generated some social and economic benefits into expensive net liabilities. This failure of public policy to adapt to change may well create a text book example of how not to manage public assets.

There needs to be a major change in the management of the assets and liabilities of New Towns and in particular the role of English Partnerships. The Government should:

- recognise the full extent of the physical liabilities facing the new towns, resulting directly from their former new town status

- implement the recommendations of Stage 1 of the EP review without delay - namely the transfer of non-strategic sites and planning powers to the local authorities;

- transfer strategic sites to the Regional Development Agencies;

- end the clawback arrangements.

- establish a New Towns Reinvestment Fund to re-cycle the receipts from strategic land sales to be allocated on the basis of need.


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Prepared 29 July 2002