Examination of Witnesses (Questions 160-178)|
Q160 Mr Betts: Have any of them, so far,
with that statement, had any impact?
Mr Clarke: It is very early days.
The Northern Way has been around only since February 2004. The
ODPM are about to publish a major report in January or early February,
the State of the Cities report, and we have started working
now, within the Northern Way, on eight city regions which have
produced City Region Plans. The strategy is a 25-year strategy.
I think, to start with, there are some early signs of things moving
in the right direction, but this is a marathon not a sprint.
Q161 Mr Betts: What do you mean by "the
Mr Clarke: Within the North East,
for instance, there is significant investment going into assigned
city development within the Tyne and Wear City Region, based in
the heart of Newcastle but linked into Durham University, Northumbria
University, Sunderland University will get involved as well, which
makes the absolute point that if you stuck just to the Newcastle
City Council boundary you would not get that wider linkage.
Q162 Mr Betts: Let us move on to look
at the area which you have raised. It might be seen that therefore,
by city regions or whatever, you are following the line in your
submission that really this is all a technical process and you
are looking where growth is and therefore you are working out
where the houses need to follow the jobs, and what we have got
is a bit too much political interference and a bit too much democracy
in this. Indeed, this is almost the submission you are making
to us, we should have a technical solution, nothing to do with
this democracy that gets in the way of this?
Mr Clarke: The major cities within
the North have been involved in the Steering Group from the outset,
so the Leader of Manchester Council, the Leader of Leeds Council,
the Leader of Newcastle Council, as well as Chairs of Regional
Assemblies, they have all signed up to and supported the Growth
Strategy. Indeed, the proposals that are coming forward now for
city regions are also linked in with the proposals that ODPM are
looking at, following the City Summit visits, which the Minister,
David Miliband, had during the summer. In fact, there is very
much a democratic angle to all of this and politicians within
the North, at local authority level and regional assembly level,
have signed up to the Growth Strategy, including the eight city
Q163 Mr Betts: Absolutely: "the
effect of the `strategy' in determining supply is the most important
factor, but is often less than transparent and overly-influenced
by political considerations"?
Mr Cruddas: I think we are talking
about two different strategies. If I may just clarify the point
in the memorandum, at the moment the political process is brought
to bear in Regional Spatial Strategies very late on and so what
tends to happen is that people interfere, if you like, in the
technical process. What we are suggesting is that you need to
bring that political process into play much earlier at the city
regional or sub-regional level, as you are working out what the
future is of that localitythe functional spatial area that
relates most closely to the real world economic geography in which
we are set. Far from denuding the role of the political process,
actually we are advocating its earlier involvement and that should
lead, we hope, to less change later on, less unclear action, that
is currently part of the political process.
Q164 Mr Betts: Just to follow up particularly
on how you think things might move forward then, you are saying
that things should be more developed at the sub-regional level,
yet, another point you have put, you are almost totally prescriptive,
are you not? In 2.11 you say to us: ". . . the emergence
of Greater Manchester and Leeds, and to a lesser extent Lancashire,
as important locations for household and employment growth."
In other words, those city regions are going to get on and do
the business because you have said it is a good thing that they
should. "However, the housing allocations adopted within
Regional Planning Guidance actually underplay the economic importance
of Greater Manchester, Lancashire and Cheshire yet overplay the
economic importance of areas such as South Yorkshire and Humberside."
In other words, they should actually reduce their projections
for housing growth, determined at the regional level, before they
even begin to look at the sub-regional approach?
Mr Cruddas: Although the memorandum
is ours, that data is not ours. That data is derived from both
regional data and city regional level data. Economic forecasts
that have been prepared for those places, either at regional level
or sub-regional level, show that West Yorkshire and Greater Manchester
will grow significantly over the next 15 years. What we are demonstrating
to the Committee is that at the moment the Regional Planning Guidance
as currently drafted presents you with higher, in proportionate
terms, housing allocations in South Yorkshire, East Riding and
Hull as compared with that economic trajectory and it underprovides
for housing in those areas with high economic trajectories. That
is not our data; that is just a contrast between the two.
Mr Clarke: I think the other tension
in here, and it is one, is that, if you look on a European scale
then the only cities in the North that even begin to hit the radar
screen, in terms of economic performance, are Leeds and Manchester,
and clearly Manchester, with the only international airport in
the North, is of great importance to the whole of the North. Part
of this is about playing to success and building on success and
improving that even more, while at the same time clearly trying
to improve the economic performance of other areas which at the
moment are much lower down in any sort of European league table.
We do feel that, within the Northern Way Growth Strategy, rather
than through housing, I am thinking of at the moment when I say
this, we need to build on our strengths. Certainly the sort of
wealth creation that has gone on in Leeds and Manchester over
the last five or ten years needs to be built on and further reinforced,
and housing, transport and skills are all part of the agenda with
respect to that.
Q165 Martin Horwood: You seem to be enthusiasts
for sub-regional, real world economic geography, which is not
a phrase I would say often, but you are fairly scathing about
regional assemblies, saying "being based upon the model of
70% local authority membership was often cited as being unhelpful
. . . " I am not clear whether that means you are in favour
of 100% or a smaller percentage, or you want to get rid of them
Mr Cruddas: I think the point
is the one I made earlier. There is not a right percentage. The
issue is that our consultees were those which produced that evidence;
we have consulted quite widely, as the memorandum explains. I
think what we need to do is involve the political process much
Martin Horwood: I am talking specifically
about whether you think functionally the regional assemblies are
unhelpful therefore they should be got rid of, or unhelpful therefore
they should be changed or made more democratic?
Chair: I think that is part of another
Q166 Martin Horwood: Not part of the
process. It is a point you raise in your evidence?
Mr Cruddas: We do raise it and
I think we raise it because we want to draw the Committee's attention
to the difficulty it creates when you are trying to make a technical
system work successfully. We have been challenged, on the one
hand, about the involvement of the democratic process, if you
like, the democratic accountability and the merits of that. If
you are trying to make a technical process work successfully it
is a challenge and you have to factor in that political process.
I think that is what we want to draw to your attention. I am not
sure that we have an immediate solution to that, other than the
one that I have already suggested.
Q167 Dr Pugh: I think what we are struggling
with, putting it as kindly as possible, is the raison d'etre
for the Northern Way itself and, in a sense, what you bring to
the feast. As I have followed what you have said so far, the distinctive
approach you have got is to approach most problems via some development
of something called the city regions, and I think you define a
city region fairly broadly so it includes other things apart from
very obvious conurbations, like Liverpool and Manchester and Leeds.
These are regarded as a central Lancashire city region but it
was news to many people in central Lancashire that it was. If
I can try to figure out what you are bringing to the feast, you
seem to bring a kind of philosophy or an idea that says, in the
past, housing strategy has been focused on putting housing where
we think we need jobs and you are moving now towards a market-driven
philosophy that says, in order to get economic expansion, where
we are getting economic expansion and development, we need to
have an adequate supply of housing. Am I fair to identify you
with a switch of philosophy or thinking?
Mr Cruddas: I think probably that
is fair. I would suggest though that our criticism of past approaches
is perhaps stronger than that. I think we suggest that current
approaches focus very much on housing numbers and a competition
for housing, as you suggest, in order to grow a place's economy.
I think we are suggesting that where you are seeing economic growth
you need to support it and housing can do that. What we have seen
also is that housing has not been the panacea that people have
tended to advocate in the past.
Q168 Dr Pugh: From my experience on Merseyside,
I think I would endorse that, in respect of many areas where you
can get economic growth you cannot get housing, and in many areas
where you are getting housing you are not getting any elements
of economic growth, or not appreciable elements of economic growth
anyway. Taking that as the obvious data, do you think that you
are going to have a problem, in terms of the strategies you are
evolving, coming to terms with some of the strategies that are
already there? Many of the strategies, like Pathfinders, which
were well supported by Regional Development Agencies, are supported
primarily because they are about economic inclusion rather than
because they are specifically to do with economic growth.
Mr Cruddas: Market renewal began,
of course, as a response to the low demand for housing that we
were seeing three or four years ago. I think what we have seen
increasingly is that most Market Renewal Pathfinders have identified
the economy as absolutely critical to the strategies that they
have pursued, and some are pursuing a strategy therefore which
reflects their relatively low economic potential and some are
pursuing a strategy which either supports or seeks to promote
their economic growth in the future. As the Northern Way develops,
as we develop our proposals, of course we will have to seek to
influence other people's strategies. I think we see that as a
key part of our job. We are not suggesting that we are taken as
a given, that would be very foolish. I think we need to promote
what we are saying and advocate it and win people's support because
of the strength of our argument.
Mr Clarke: It goes back to your
earlier question about the raison d'e®tre of the Northern
Way. It is very much an economic growth strategy. It is a view
and an opinion that, by collaborating across the North, with a
14 million population, the strength of the universities, the business
base, and so on, not on everything but on a small number of big
areas of activity, which are important, around transport and skills,
perhaps marketing the North for tourism and internationally with
investment, there are greater economies of scale of collaborating
in that way, as long as you know when to move back and do things
at a regional, sub-regional or local level as well. There is a
£30 billion productivity gap and it is the view of the three
regions of the North that really to start making an impact on
that we need to collaborate more effectively together, and so
the Growth Strategy was produced for that reason. At the core
of it, it is an economic growth strategy and that is what the
vision is about.
Q169 Dr Pugh: You commented favourably
on the Government's changes to the planning system. It is not
entirely clear to me at the moment, are there further changes
that you think should be made?
Mr Cruddas: Obviously, we are
still looking at all of the things that came out yesterday, a
substantial welter of consultation documents. I think our initial
view of those that we have had the chance to look at, which is
in particular Planning Policy Statement 3 in draft, is that it
has made substantial progress since Planning for Housing Provision
was published in July, and obviously we want to work with Government
as they finalise their proposals. I think a key test will be how
well we can implement the framework that is now proposed. I do
not think we should be under any illusions that the publication
of a Planning Policy Statement will suddenly make the world right,
and we need to recognise that implementation is a huge issue for
us. It is a very sophisticated system that we are moving towards.
Q170 Chair: Can I pick up on just one
further point on the housing supply issue. Your strategy of moving
the houses to where the jobs are and not providing them in the
other areas, will not that lead simply to an even greater polarisation
of housing supply in your region, which you outlined as a problem
in your paper, in the first place?
Mr Cruddas: I cannot see how it
would, Chair, but I am not sure I completely follow the logic.
The present polarisations that we experience are because people
are leaving our urban conurbations because they can find the kind
of property that they want to live in at a distance from where
they work. What we are intending to do, in adding to the supply,
which is only one% a year that we add to the supply, is concentrate
that new supply more closely to where people can work.
Q171 Martin Horwood: Can I just be clear,
you are not suggesting a kind of market-led process where the
supply follows housing demand, you are saying it should be steered
Mr Cruddas: Absolutely.
Q172 Mr Betts: In terms of logic, you
support the move towards building on more brownfield sites, because
they are probably located in the cities that you are talking about.
I do not know whether you have had a chance to look at yesterday's
announcement and whether you think that the Government's proposals
now will assist in that objective that you have, or it is going
to make it easier for builders to look for sites elsewhere and
avoid the obligations on brownfield sites?
Mr Cruddas: I am aware that there
has been some comment on whether or not we are now going to see
less emphasis on brownfield land. I think we would support anything
that emphasises brownfield land and we have not yet reviewed yesterday's
announcement for that.
Q173 Anne Main: You have highlighted
the problems of rural areas where demand from tourists and for
second homes is driving up housing prices. What would you think
was the way forward with that?
Mr Cruddas: It is important to
recognise that the rural communities in the North are not a homogeneous
whole and I think there is a danger that we perceive the rural
housing market to be one single market. We will work closely with
the Rural Affordable Homes Commission, as it does its work over
the next few months, to look at how the North's housing markets
are reflected in their work. I think what we will be looking for
are solutions which recognise the differential nature of the market
and it is something I think, Anne, is a point that has been made
to you in the evidence from the Commission for Rural Communities.
Their memorandum to you says very clearly that the rural markets
are very different across the piece.
Q174 Anne Main: Where they are rural
markets for second homes in particularly beautiful districts,
do you have any thoughts about that?
Mr Cruddas: Some places are approaching
it by imposing planning controls such that new homes are available
only to local residents in the future. That may be one option,
long term, but we need a variety of options. I do not think we
have looked in detail yet at what the options might be for rural
communities. I go back to our advocacy of a sub-regional approach.
If you were looking at housing markets sub-regionally, you would
be able to take into account, in the way you planned for new houses,
the particular circumstances prevailing in rural communities as
much as you could for cities. I think what we are doing at the
moment is not reflecting individual circumstances.
Q175 Anne Main: Are you looking at the
demographic need, because you said about, for example, attracting
people into areas with larger houses, perhaps who have got the
enhanced skills set that you want and you want them to be able
to find a level of housing that they find acceptable? Are you
looking at the demographic need of your rural areas, is that being
analysed, apart from the second-homers, and are you looking at
who wants to live in your rural areas? Based on the fact that
you are thinking of houses following jobs, is that the case in
your rural areas, or is it just demand because people want to
Mr Clarke: I think, the point
that James made about rural areas not being a homogeneous collection
of housing, if you take somewhere like the Tyne valley, in the
North East, it is rural, very attractive, expensive housing, mainly
not second homes, mainly just first homes for people who have
well-paid jobs, often based on Tyneside, the journey to work,
either by train or by car, is relatively short, in terms of time.
There, there will be an issue about younger people growing up
in the villages of Hexham or Corbridge being able to afford housing,
and that is where some of the planning issues will be looked at
and tenure issues can be looked at to see if you can go for some
sort of mix and element of social housing. In other rural areas,
ex-coalfield areas, which can be in rural as well as urban locations,
probably there is a greater range of housing available at a lower
or more modest price and you might have to travel a bit further
into employment to do that. In parts of Northumberland we have
rural areas, ex-coalfields, with a lot of new, modern housing,
which is very attractive, and the whole image of those areas is
being transformed as a result of that. If you go into County Durham
you get a different range of issues. You get some villages which
are really somewhat off the beaten track and the economic heart
has disappeared from them, so there you are looking for a different
sort of approach, and the same if you took Yorkshire and the North
West, so our rural areas are really very, very diverse. Then Berwick
is almost in Scotland but it is still in the North East with a
different set of issues.
Q176 Anne Main: If you had local control
over how you manage those particular areas, how would you feel
that went in with your sub-regional approach? You are coming up
with different issues by just restricting it to who can live there,
perhaps second generation, or whatever?
Mr Cruddas: I think control is
perhaps taking it too far. There needs always to be reconciliation,
moderation, if you like, at the regional level of what is being
proposed from different local areas. You have to see that moderated,
otherwise you could have somewhere pursuing its own strategy,
flying in the face of all the evidence and all that others were
trying to achieve. I think there has to be recognition that the
housing market does not stop at a local boundary, and that is
quite an important point. On the other hand, there needs to be
recognition of particular circumstances, as Alan has said, about
where there are particular issues for different rural communities.
We have not pursued a lot of this ourselves directly yet because,
of course, a lot of the work is being done at regional assembly
Q177 Chair: Can I just follow up the
earlier question about housing moving to where the jobs are. Would
not that have the undesirable side effect of leaving some people
marooned in the areas which have no jobs in which nobody wants
Mr Clarke: I think that you need
to have a twin-track approach. It is a question of, on the one
hand, building on opportunity, which is, in the Manchester and
Leeds case, where the success has been, in terms of academic development,
and I think you need to make the most of that. Also I accept that
other areas have needs. Easington, in the North East, is an area
where the coalfield activities have declined, where a lot of investment
has been put in, shopping development, business park development,
Enterprise Zone development, and so on, but with the best will
in the world it is almost impossible to get the same number of
jobs, and new jobs, knowledge-based jobs, and so on, in Easington
as used to be the case. The same would be true in east Durham,
and so on. I think we have to work out complementary strategies
of trying to create a new economic focus for such communities
but accept that probably it will be at a more modest level, and
some people may have to travel what is not necessarily a massive
distance to jobs that might be just a little bit further away
and of a different type as well.
Chair: Thank you very much. I think Mr
Betts has just one bit of information he would like you to send,
Q178 Mr Betts: Your response about yesterday's
announcement, which obviously you have had very little time to
digest, would it be possible to give us another submission in
writing about your response to that, particularly the issue about
brownfield sites, and whether yesterday's submission will help
or hinder in the direction we want to go?
Mr Cruddas: Yes, of course. It
will be interim because the consultation is likely to run longer
than your inquiry; but, yes.
Chair: Thank you very much indeed.