Regeneration

Written evidence from NAVCA

Summary

NAVCA believes that Government should continue to invest in the three components of regeneration, social, economic and physical, and seek to maintain the right balance between them. We were concerned at the absence of a specific mention of regeneration in the Coalition Programme [1] and welcome the inquiry as an indication of a continuing commitment to this vital area of activity.

The Consultation Document is exceptionally brief, lacks vision and is weak on structure and content. It is not sufficient to rely on the Local Growth White Paper to provide strategic framework, as that document is concerned primarily with economic development. Nor does the categorising and repackaging of policies and programmes which have survived the 2010 Spending Review provide reassurance that a coherent strategy for supporting regeneration is likely to emerge. We acknowledge that the Select Committee faces a daunting task in addressing these deficiencies and attempting to arrive at a new approach to regeneration. NAVCA pledges its continuing support, both in advising Government on how this might be achieved and in assisting voluntary and community organisations (VCOs) to engage fully in the delivery of regeneration programmes and activities.

Our main recommendations are:

· A strategic framework is required for the new approach to regeneration. It is not sufficient or acceptable either to repackage existing schemes with new labels or to rely on the Local Growth White Paper to provide this.

· VCOs have traditionally been the pioneers in many aspects of public policy, including regeneration. The new approach to regeneration should not confine VCOs to the role of delivery agents; it should also provide them with an opportunity to continue to innovate in tackling deprivation and disadvantage.

· The Select Committee is urged to recommend that the third sector, including VCOs, is given equal status alongside the public and private sectors in a new approach to regeneration.

· The new approach to regeneration should not imply wholesale abandonment of past policies and programmes simply because they have come to be identified with the previous Government. Effective mechanisms for knowledge transfer should be put in place to preserve the intellectual capital of agencies which are being merged or abolished.

· We are concerned that government funding for regeneration has been artificially inflated in the consultation document and suspect an element of double counting. We urge the Select Committee to probe the Government’s proposals thoroughly to establish whether this is the case, if the is an element we hope the Committee will call the Government to account.

· Funding for VCOs is a financially efficient means of achieving social regeneration, producing significant financial multipliers when resources are invested locally.

· A fire-sale of RDA assets before enactment of the Localism Bill would prevent communities from identifying assets of community value and exercising their right to bid for them. A moratorium is required on the disposal of these assets so that their value as assets to the local community can be fully assessed.

· A review of previous regeneration initiatives shows that Government does not always have a monopoly on the best ideas – there is much to be gained from harnessing the ingenuity and commitment of communities.

· Proposals to return a proportion of the planning gain recovered through the Community Infrastructure Levy to neighbourhoods require clarification. At least 25% should be earmarked for community use and communities should have control over how the proceeds are used.

· The pressures on local authorities resulting from the Spending Review have threatened councils’ financial support for voluntary organisations. The Committee should emphasise to Government the importance of voluntary organisations and community groups to regeneration and ask them to protect public funding of VCOs at local level.

· Social value should be taken into account in the appraisal and evaluation of regeneration initiatives.

· Government must recognise that for neighbourhoods to improve there must be investment in the people who live there and not just in economic development projects or physical assets.

How effective is the Government’s approach to regeneration likely to be? What benefits is the new approach likely to bring?

We are concerned at the apparent absence of a strategic approach to regeneration. We would urge the Select Committee to recommend a strategic framework for a new approach to regeneration, comprising:

· A vision for regeneration which balances the social, economic and physical aspects

· Aims which highlight the different needs of urban and rural communities, promote equality and diversity, address regional imbalances, and consider the relative merits of national, thematic and area-based approaches to regeneration;

· Objectives, which form part of a programme for at least the remainder of the current term of Government;

· An outline budget, which sets out what the Government (national and local) should invest and what can realistically be expected to be leveraged from the private and voluntary sectors.

VCOs have traditionally been the pioneers in many aspects of public policy, including regeneration. The new approach to regeneration should not confine VCOs to the role of delivery agents; it should also provide them with an opportunity to continue to innovate in tackling deprivation and disadvantage. It should also hold out a reasonable prospect that they will be supported by Government until they are sufficiently viable to become part of mainstream service provision.

NAVCA’s members are involved in all aspects of regeneration, but the balance of activity is inevitably skewed towards social regeneration. In our view social regeneration is the key for to a better quality of life and for access to economic opportunity for the most disadvantaged citizens. It is social projects that develop self confidence; introduce people to basic skills such as literacy, education and first step training programmes; work with young people, ex-offenders, lone parents and those who have never had paid employment to give them hope, choices, opportunities and skills. Such work in disadvantaged communities leads to better economic outcomes not only for the beneficiaries but also for society as a whole.

We have responded positively to the Localism Bill, founding the Real Power for Communities Campaign [2] and submitting memoranda to the Bill Committee and responding to CLG Consultations. We believe that Localism ought to be an opportunity for real empowerment local communities, putting them in control of regeneration at neighbourhood level. We have indicated qualified support for proposals in the Localism Bill for neighbourhood planning, the right to challenge and the right to buy. Without repeating the specifics of our evidence, we would draw the Committee’s attention to some of the cross cutting themes we have identified as these are relevant to successful regeneration. In our view, future policies and programmes should aim to

· Reduce inequality and safeguard the rights of minorities. The wid ening of public service provision should be to the fundamental protections contained in the Human Rights Act (HRA) 1998, the new Public Sector Equality Duty (PSED) under the Equality Act 2010.

· Balance social, economic and physical aspects. We are campaigning to en sure disadvantaged communities can have real access to new rights, powers and programmes– not just the powerful and affluent.

· Promote community empowerment, strengthen local democracy and harmonise representative democracy with participative democracy. VCOs are an important channel for delivering participative democracy at local level

Will it ensure that the progress made by past regeneration projects is not lost and can, where appropriate, be built on?

The new approach to regeneration should not imply wholesale abandonment of past policies and programmes simply because the have come to be identified with the previous Government. It is essential that effective mechanisms for knowledge transfer are put in place so that the intellectual capital of those agencies which are being abolished can be captured, codified and made accessible to regeneration practitioners and communities in future. The speed which Regional Development Agencies, Urban Regeneration Companies and local special purpose vehicles have been dismantled has left little time for knowledge transfer to be accomplished but with immediate action, it may be possible to salvage some essentials. There would be immediate benefits. For example, the task of Local Enterprise Partnerships in producing local economic strategies could be simplified if the evidence base of previous strategies is recovered; and the chances of success of future regeneration projects will be improved if their promoters have access to a database of previous project evaluations. Government should make a distinction between breaking with the past and learning from the past.

NAVCA members have devoted time and ingenuity to negotiating and agreeing Compacts, Neighbourhood Charters and Commissioning Codes with local authorities and have been partners in LSPs producing Community Strategies for local areas. It is essential that these important documents are preserved as the new approach to regeneration takes shape.

The Select Committee should recognise that community confidence in Government-funded regeneration has been damaged by the rapidity with which the 2010 Spending Review has been implemented. In some Housing Market Renewal Areas, homes acquired for refurbishment or redevelopment now stand unoccupied (an irony given the programme was intended to tackle estate abandonment) whilst the loss of substantial HCA funding for PFI-led regeneration has disillusioned those living in the communities affected (including the Aylesbury Estate in Southwark featured on CLG’s webpage for the present Regeneration Enquiry!)

Will it ensure that sufficient public funds are made available for future major town and city regeneration projects as well as for more localised projects?

The question of whether sufficient public funding will be provided for regeneration is one for the Coalition Government to decide, but on the evidence provided in the Consultation Document, we are concerned that this will not be the case. Certainly, big figures appear under the heading of ‘Targeted Investment’ in the consultation document, but the purposes cited are mostly for large scale infrastructure projects, some of which are not primarily or even substantially about regeneration. There is certain to be a large measure of double counting as the same figures are re-quoted in other Government policy documents. We urge the Committee to probe the Government on this and to condemn any attempt to artificially inflate its apparent funding for regeneration.

In the past we have expressed concern about the transition from the Single Regeneration Budget programme to the Single Pot, in particular that whilst overall levels of funding had been protected, the latter was not as effective in channelling funds to local communities. Then as now, efficiency and effectiveness of targeting funding are also important.

Our call for a balanced approach to regeneration does not necessarily imply equal funding for social, economic and physical aspects. Physical regeneration is, by its nature, more capital intensive and current priorities, largely in response to recession, focus on economic development and growth. But we urge the Select Committee to recognise the importance of social regeneration and the financial efficiency of funding the VCOs working at neighbourhood level;

‘The positive case for investment in communities is that it will boost social capital, enhance collective efficacy and support the mobilisation and use of a wide range of local resources. In this way many local grants for community activity result in a multiplier effect of 11:1, with £2,000 resulting in a further £22,000 of support in-kind and in-cash.’ [1]

In the context of the proposed Right to Buy in the Localism Bill, we urge the Select Committee to consider the future of public sector assets alongside direct funding of regeneration. The HCA has recently been charged with managing the disposal of RDA assets, in doing so balancing the need to promote regeneration with obtaining the best return for the public purse. It is vital that disposals are not allowed to proceed before communities have the opportunity, to be provided in the Localism Bill, to nominate some of these assets as being of community value and of bidding to acquire them. A ‘fire sale’ at this stage will result in community divestment. The action of the Commission for New Towns following the wind-up of the Development Corporations provides ample evidence of the dangers of asset-stripping and the losses communities can sustain in such circumstances [2] .

What lessons should be learnt from past and existing regeneration projects to apply to the Government’s new approach?

The experience of NAVCA and its members of past regeneration initiatives stretch back to the early 1970s – clearly a review of the strengths and weaknesses of all of them is beyond the scope of the Select Committee’s inquiry. We have therefore selected ten initiatives and twenty lessons (ten positive and ten negative) that might inform the Committee’s deliberations:

1970s	Community Development Projects
+	Action Research engaged communities in pioneering new approaches to dealing with social disadvantage
-	Concluded that causes of urban deprivation lay in structural economic decline largely beyond the scope of area based intervention

1970s	Inner City Partnerships
+	Brought central and local government together in addressing urban decline, backed with substantial additional funding
-	Central government funding applied to mainstream local authority capital projects (no additionality) and community not directly involved in the partnership

1980s	Comprehensive Community Programmes
+	Pioneered a co-ordinated, multi-agency approach to tackling deprivation, later adopted by Local Area Agreements and Multi-Area Agreements
-	Overly academic in analysis, complicated systems of delivery and weak community engagement

1980s	British Coal Enterprise
+	Delivered managed workspace and advance factory units in coal closure areas, many of sites of former collieries and assistance to former miners to launch new business enterprises
-	Did little to address the social fragmentation that resulted following colliery closures or to mend the rifts in communities following the mining industry dispute.

1980s	Urban Development Corporations (First Generation)
+	Substantial funding, planning powers and can-do approach cut through red tape and kick started physical regeneration
-	Community side-lined or ignored with the result that mistakes were made with long-term adverse consequences

90s-00s	Single Regeneration Budget 1-6
+	Later phases particularly effective in engaging local authorities with VCOs at neighbourhood level and funding community led projects
-	Despite efforts to secure a legacy, many initiatives started under SRB collapsed following withdrawal of funding

2000s	Neighbourhood Renewal Funds
+	In conjunction with LSPs, supported community based projects with a direct impact on areas of deprivation, helping to create a feeling of belonging and tackling the causes rather than the symptoms of deprivation
-	Diversion of some of the funds intended for communities to maintain local authority mainstream services

2000s	New Deal for Communities
+	Concentrated funding on small areas with the aim of reducing the gaps between the most deprived neighbourhoods and the rest of the country. Communities given a large degree of control the administration of programmes
-	Poor support structure and Insufficient effort put into capacity building, with the consequence that some schemes failed spectacularly

2000s	Urban Regeneration Companies
+	Drew together public, private and voluntary sectors in commissioning and agreeing a regeneration strategy and undertaking mainly physical regeneration projects with an emphasis public realm improvements
-	Lacked sufficient consensus to attract funding for more ambitious schemes and wound up with no regard for preserving a legacy

90s-10s	Regional Development Agencies
+	Produced coherent economic development strategies for the regions and provided funding for regeneration programmes at sub-regional level
-	Poor on delivery, consequently struggled to gain public acceptance and were perhaps wrongly, associated by the Coalition Government with failed attempts to establish regional government

It is, of course, possible to look even further back for examples of what might now be classified as regeneration- for example the model towns of Owen in New Lanark and Cadbury at Bourneville, the achievements of the Rochdale Pioneers in establishing retail co-operatives and Howard’s Garden Cities in Hertfordshire. These prove that Government does not always have all the answers – there is much to be gained from harnessing the ingenuity and commitment of communities and the entrepreneurialism and corporate social responsibility of the private sector.

Nevertheless, it is essential to learn from experience, particularly at a time of limited resources, and we believe that current policy must draw upon the lessons of past regeneration programmes if it is to avoid the mistakes of the past.

What action should the Government be taking to attract money from (a) public and (b) private sources into regeneration schemes?

NAVCA takes issue with the way in which this question has been framed; first, because it focuses on money, ignoring the other two economic factors, property and labour; and secondly because it overlooks the vital contribution of the VCOs and the wider third sector to regeneration.

Previous work by NAVCA members, the Asset Transfer Unit, the DTA (now Locality) and others have demonstrated how transfer of public sector assets into community ownership can drive regeneration at neighbourhood level. Provisions in the Localism Bill will take this a step further by encouraging communities to identify and bid to acquire assets of community value. Of course, money will also be needed, not only to finance asset purchase but also endowment funding to underwrite long term maintenance costs or certain assets.

We support proposals to change the Community Infrastructure Levy, whereby a proportion of the planning gain from the development of land will be returned to the communities affected. This ought to ensure that redevelopment schemes in urban areas integrate with the surrounding neighbourhood and contribute to the improvement of community facilities. But this will only be fully effective if a reasonable proportion of the levy (at least 25%) is earmarked for neighbourhoods and the community has control over how it is used. Otherwise, there is a risk that it will disappear into Council balances. We urge the Committee to seek early clarification from Government on these matters.

Human resources are essential to successful regeneration. The area based regeneration schemes of the past have depended on engaging members of the community and harnessing the efforts of VCOs at neighbourhood level. We have already referred to the large economic multipliers produced by investment in VCOs. The pressures on local authorities resulting from the Spending Review have threatened local authority financial support for voluntary organisations. NAVCA is concerned about the situation and fears that VCOs may be forced to accept a disproportionate reduction in support for their activities. The Select Committee should emphasise to Government the importance of the voluntary and community sector to regeneration and ask them to protect public funding of VCOs at local level.

Finally, the Committee is urged to recommend that civil society, including VCOs, is given equal status alongside the public and private sectors in a new approach to regeneration. In addition to unlocking human capital at neighbourhood level, it provides knowledge of conditions at neighbourhood level and draws in finance in the form of charitable donations to support activities. NAVCA is concerned that VCOs have already been side-lined or overlooked completely in some of the new initiatives under the regeneration umbrella. Many LEPs either excluded VCOs or provided only token involvement- a clear indication that their promoters (largely local authorities) may regard them as irrelevant to local economic regeneration.

How should the success of the Government’s approach be assessed in future?

There is an established procedure for appraisal and evaluation of Government policies and programmes, as set out in the Green and Magenta Books [3] and other Government guidance and evaluation frameworks. Continued use of these frameworks has the benefit of allowing comparison between future approaches to regeneration with evaluations of those undertaken in the past.

NAVCA has supported proposals for social value to be taken into account in project appraisal and evaluation as well as tender assessment for public service commissioning. We have argued that value for money, a key component in assessing success of Government interventions, should include social value, expressed as the wider benefits to communities and individuals of a particular approach. A 2009 Cabinet Office paper expressed this well:

‘Put more simply, there are three elements to value for money as defined by Treasury:

1. Quality and suitability the service for the individual;

2. Long term implications or whole life costs;

3. Wider outcomes for society and the state.

Value for money is concerned not just with unit costs but with what has been called the full value or public benefit that a provider brings to delivering a service’ [4]

Crucial to this is the extent to which Governments invests in people and not simply in economic development projects or physical assets, vital though they are. This entails support for social projects that develop self confidence; introduce people to basic skills such as literacy, education and first step training programmes; work with young people, ex-offenders, lone parents and those who have never had paid employment to give them hope, choices, opportunities and skills. Such work in disadvantaged communities leads to better economic outcomes not only for the beneficiaries but also for society as a whole.

In conclusion, we hope that the Committee will acknowledge the essential part that the voluntary and community sector plays in successful regeneration. Working in partnership with the public and private sectors we can:

· Enhance community engagement and capacity;

· Leverage social value;

· Build social capital and collective efficacy;

· Identify and make use of local assets;

· Ensure institutions are more accountable to local users; and

· Articulate the empowerment mechanisms that are to be available to people.

Prepared for NAVCA by

Pro-bono consultant on Decentralisation and Localism