Examination of Witnesses (Question Numbers
60-79)
MR PETER
HOUSDEN, SIR
BOB KERSLAKE,
MR RICHARD
MCCARTHY
AND PROFESSOR
STEVE FOTHERGILL
11 JANUARY 2010
Q60 Mr Davidson: So you are saying
that ministers made conscious decisions that those were the proportions?
Mr Housden: They would have done,
yes.
Q61 Mr Davidson: Earlier on, you
mentioned that some of the land work was actually about remedying
sites that were actually dangerous.
Mr Housden: Yes.
Q62 Mr Davidson: Some of it was clearing
up. That in a sense is not regeneration of the community at all,
is it? That is a different sort of obligation. Can you just clarify
the proportions involved?
Mr Housden: I am not sure that
I can give you numbers about the proportions.
Q63 Mr Davidson: So you do not know?
Mr Housden: I do not have the
information here today, but I do know that typically, many of
these sites would present both of the types of situations that
you describe.
Q64 Mr Davidson: I understand that,
that was not what I asked.
Mr Housden: When I was answering
the Chairman's initial question, in the first stages, the first
tranche of sites were identified, and as it became clear the scale
of the challenge on those sites, and their economic potential,
it was recognised that they would not deliver the number of jobs
that would be required by communities.
Q65 Mr Davidson: Right, but if we
are pursuing the question of value for money, we have to identify
what the point of actually doing this is. If the point is to make
the sites safe, then that is a different element, a different
process of counting, to the question of job creation by remedying
sites. It seems to me that if you had been seriously interested
in monitoring your value for money in terms of creating jobs,
you would be able to separate out money that you had to spend
because of safety concerns, and that had to be done anyway, as
distinct from the money that was being spent to generate jobs,
because presumably, you would always be in the position where
you had more sites seeking money spent on them than you had money
available, and therefore, you had to have some sort of priority,
and presumably therefore, you had a process by which you identified
sites that gave the biggest bang for the buck in terms of job
creation, but there was also sites that irrespective of that process,
you had to spend money on because they were dangerous. Now give
me some evidence that you had that process.
Mr Housden: I think you are exactly
right, there will have been some sites with very low economic
potential, where their remediation would have been put well to
the back of the programme, and you might have expended some limited
money to actually just make them safe, to prevent people getting
on the site or other types of issues. But the distinctions you
are seeking to draw are perhaps not as absolute, because some
sites with very high—
Q66 Mr Davidson: I understand all
that. I have chaired the regeneration group in my own constituency,
and we have wrestled with these problems, but we understood what
we were doing and the choices that we were making, and you do
not seem to have. Can I just ask, in terms of viring money from
one heading to another, as it were, of these three categories,
have you ever recommended to ministers that they should actually
be spending perhaps more on business regeneration than they are
on land remediation? Because I noticed at one point that the Deputy
Prime Minister's Office had identified I think £50 million—yes,
in paragraph 12, that "£50 million was required to meet
the need identified by a Government Task Force in 1998",
in terms of business. Did you ever recommend that the balances
had been got wrong?
Mr Housden: It is worth pointing
out that each year to 2007, there was an annual conference to
review the progress of the overall programme, at which ministers
were active and involved, with a range of interests, giving them
advice about the balance of needs in the programme, and reshaping
it going forward, point 1. Point 2, if you take business development,
the point you are pursuing here, the potential sources of funding
for that in an area would be many and varied actually, it would
not simply be from this programme. People have mentioned European
funds, there are others, Regional Development Agencies were active,
so you would be able to draw money into those activities not simply
from this programme.
Q67 Mr Davidson: Okay, so the £50
million required to meet the need identified has been met by other
sources, has it?
Mr McCarthy: That refers to—
Q68 Mr Davidson: Paragraph 12.
Mr McCarthy: —the money
that has gone into the venture capital funds, where actually the
government has put £20 million into venture capital, and
that has geared in private sector investment which will take us
beyond those numbers.
Q69 Mr Davidson: Has the £50
million that has been identified there been found?
Mr McCarthy: In effect, yes.
Mr Fothergill: I think I can help
on the £50 million, because I am personally responsible for
that £50 million being written into the Coalfields Task Force
report, when I was a member.
Q70 Mr Davidson: Has it been found?
Mr Fothergill: Can I finish?
Q71 Mr Davidson: No, can you answer?
The way it works is I ask you the questions and you answer.
Mr Fothergill: I think first of
all, you need to understand that that £50 million was not
the basis of some detailed scientific investigation, it was what
felt right at the time to the members of the Coalfields Task Force,
indeed I think actually we said £50 million with an aspiration
to raise it further. Now the Coalfields Enterprise Fund is clearly
substantially smaller than that, and from a local authority point
of view, that is somewhat disappointing, but the Coalfields Enterprise
Fund is not the only equity investment player in the field.
Q72 Mr Davidson: So do I take it
then I am not getting an answer to this?
Mr McCarthy: Let me just help
you. If we look at the Coalfields Enterprise Fund, it consists
of £20 million of public sector investment, £10 million
of that is matched in the second element of the fund, so that
takes you to £30 million. The first element has already geared
in £22 million of additional private sector investment, through
the matching process. That takes you to £50 million.
Q73 Mr Davidson: Right, so in fact,
the £50 million that was identified as being required by
the Government Task Force in 1998 has been provided?
Mr McCarthy: In effect, yes.
Q74 Mr Davidson: What do you mean,
in effect? Either it has been provided or it has not.
Mr McCarthy: There has been a
mix of private and public sector funds.
Q75 Mr Davidson: That was what was
meant by that figure when it was identified, was it, it was a
mixture of private and public funds, as distinct from what I had
read it as being, the £50 million that would have to be put
in in order to be matched elsewhere.
Mr McCarthy: I think the aspiration,
as Steve will tell you, was for public sector funds to have reached
that level, they have not.
Q76 Mr Davidson: That is what I thought.
Can I just clarify then, in terms of what has happened to the
people involved, and I must say, I do find myself very surprised
by the statement in 3.22 about the development saying that—there
was a quote from 2004, recommending that "the redevelopment
of any site should not go ahead unless programmes are in place
to ensure that the benefits are available locally", and that
that is still not happening. I can remember chairing an organisation
in Scotland when I was a local authority member, when we were
doing this 20 years ago. Now if it is the case here, 20 site developments,
16 did not have a specific programme in place for local jobs,
these are lessons that were learnt in GEAR in the east end of
Glasgow more than 20 years ago, because what happened then was
that they created jobs, and these jobs were all filled by people
commuting in from more prosperous areas, and therefore, what was
introduced was a policy of training people specifically for jobs
that were known to be onstream, and you seem not to have done
this. Now how can we consider that this is value for money when
you have no objectives in terms of regeneration for the people,
the jobs benefitting the people in the particular areas?
Mr Housden: Two things to say,
Mr Davidson, about this. I think the first of them is that the
level of engagement with local communities in this programme,
as Professor Fothergill has indicated, has been at a level that
is quite unprecedented, because often you hear the criticism that
regeneration programmes are being done to communities.
Q77 Mr Davidson: Sorry, can I—
Mr Housden: I do not think that
is the case here.
Q78 Mr Davidson: You have stalled
enough. Can I just clarify? It says here that of the 20 sites
in development, 16 "did not have a specific programme in
place for local people." Either that is true, or it is not.
Now you have agreed this Report, and therefore I presume it is
true. I find it absolutely astonishing that there is not a specific
programme in place for local people on particular site developments.
Can you just clarify why there is this apparent negligence?
Mr Housden: I am not aware of
the 16 individual instances that the NAO survey team are referring
to. I am aware that the activities of the Coalfields Regeneration
Trust have been highly effective in a number of areas. We have
talked extensively this afternoon about the benefits that have
been available for people in coalfield communities. We have seen
something like 2,300 community centres generated in addition to
local employment.
Q79 Mr Davidson: Sorry, you are not
disputing this then, are you?
Mr Housden: I am sure it is right,
but if it is seeking to make, and if you are seeking to make,
the point that this is a programme that has not benefited local
people, I think there is a huge—
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