Written evidence submitted by Birmingham
City Council
How effective is the Government's approach to
regeneration likely to be?
Birmingham City Council submit the following statement.
This is supported by two Background Papers; ADZ Proposition 2009
and BCC Evidence to the Transport Select Committee 2010. In summary:
— The
Council welcomes powers that allow local authorities and neighbourhoods
within them to shape their own destiny.
— The
resource implications for local authorities to support Neighbourhood
Plans needs to be recognised.
— Birmingham
has a successful track record in leading and delivering with the
private sector major regeneration projects where it has used its
assets and powers to support new development.
— This
approach has been plan led where the Council has set out a vision
and strategy as in the recently launched Big City Plan, which
is attractive to development and investment.
— With
lower levels of public sector funding and access to finance for
developers there is a need for new models such as ADZs.
What benefits is the new approach likely to bring?
The City Council welcomes in principle the provisions
within the Localism Bill to give greater power to local authorities,
and neighbourhoods within them, to shape their own destiny. This
requires commitment from the government and key departments (CLG,
BIS etc) to work with local authorities to ensure their programmes
can be aligned to complement regeneration at the local level.
This will allow Councils to inform the strategic support needed
from government based on their knowledge of priorities on the
ground and in the context of the wider framework of national aspirations
(e.g. sustainability and the green and knowledge economies). In
this respect the inclusion of a duty to co-operate amongst local
authorities and public bodies within the Localism Bill is welcomed
by the City Council.
In terms of the Localism Bill we are seeking for
a national planning policy framework to be produced and have parliamentary
approval. The emphasis on a concise and clear national planning
policy framework should enable the local level in the absence
of regional strategies to operate without significant top down
pressure but provide clarity and leadership on the national interest
and the wider sustainability aims including economic growth, housing
and climate change. The planning system has a central role in
meeting the challenges presented by Climate Change.
It is a little early to say what benefits the new
approach will bring particularly with the lower levels of public
sector funding in the immediate future. However in principle the
greater freedom for local authorities to spend monies and the
impact of incentives to deliver new development is welcomed. The
City Council is keen to develop new means of delivery including
TIFs/ADZs and maximise European funding instruments such as Jessica
and Jeremie.
The City Council has always sought to work with both
local communities and businesses in the planning and regeneration
of the city. The focus on planning at the neighbourhood level
is therefore welcomed and is something that the City Council feels
it has been progressing at the local level in recent years. The
government's focus on development and growth is welcomed and should
be integral to planning at the neighbourhood level - there will
be a need to balance a wide range of issues and tensions as plans
are progressed.
An integral part of regeneration at the local level
is ensuring that communities have appropriate education, skills
and experience to engage economically and drive the productivity
of local economies.
The relaxation of local government controls will
help overall but enabling greater neighbourhood / community involvement
(which is already evident) will need resourcing and support. The
introduction of neighbourhood planning presents a positive step
toward engaging a much wider interest in planning at the local
level. However a challenge will be the ability of Local Planning
Authorities to resource the introduction of neighbourhood planning
whilst still meeting the existing pressures to achieve sustainable
development and deliver an efficient and effective service. The
Bill proposes a range of procedural changes but these are minimal
in terms of lifting the burden on Local Planning Authorities through
freeing up resources. There is a need to be mindful of the limited
impact of those changes while at the same time acknowledging the
additional requirement that neighbourhood planning presents.
In particular will it ensure that the progress
made by past regeneration projects is not lost and can, where
appropriate be built on?
Major regeneration projects led by the public or
private sector have traditionally be plan led. Local authorities,
such as Birmingham, have rarely been a stumbling block to regeneration,
for example in Birmingham, the City Council, often working with
the private sector, has led on the transformation of the city
including regeneration projects such as Brindleyplace and the
Bullring. This has continued up to the present day with the transformation
of New Street Station and the new Library of Birmingham both on
site. Crucial to this has been a shared strategy which provides
certainty for investors and developers moving into an area or
development. The launch of Birmingham's Big City Plan has been
welcomed by the business and investment community as setting out
a vision and direction that they can share and promote.
Birmingham has also been the beneficiary of major
area based investments from New Deal for Communities (Kings Norton
and Aston) to Regeneration Zones. At Kings Norton the City Council
has been the accountable body for community led regeneration projects
- this has raised issues in terms of the Treasury's approach to
risk (including potential clawback) and the ability to pursue
innovative solutions. It has also to be acknowledged that exit
strategies which prolong the benefits in areas with low private
sector investment are not easy to deliver.
It is not yet clear if changes to the planning rules
and the introduction of community led planning documents could
introduce potential uncertainties that deter investment by the
private sector.
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?
Most of our significant regeneration projects have
been public sector led, partnerships. The replacement of RDAs
by LEPs has not as of yet been followed by public finance transfer
and it is unlikely that the Regional Growth Fund targeting private
sector projects will be able to meet demand for gap funding or
public sector led infrastructure projects. We consider that there
is potential for TIF/ADZs to fill some of the gap and have been
developing our proposals. A copy of our ADZ proposal is attached.
The City Council is also very keen to explore and pursue new initiatives
such as Enterprise Zones and develop further more localised initiatives
such as Business Improvement Districts (BIDS) within local centres
and business districts, something which Birmingham has successfully
developed in the city centre and two suburban shopping centres.
In addition we are interested in the potential of financial instruments
such as Jessica and Jeremie, as tools that could help maintain
viable major schemes with short term loans in the future.
What lessons should be learnt from past and existing
regeneration projects to
apply to the Government's new approach?
Many of the most successful regeneration projects
rely on initial public sector funding for infrastructure and reclamation
in order to provide a platform for redevelopment and marketing
of sites. It is these often expensive, elements where current
funding is in short supply and it will be a test for the new approach
that projects that are needed to make an impact can be brought
forward. We see TIFs/ADZs as critical to this.
Integrating the role of area plans and regeneration
strategies underpinned by a strong understanding of the local
market and fundamentals such as the availability of development
ready land have all played a part in bringing forward major regeneration
projects. The City Council has also used its full range of powers,
including compulsory purchase, to facilitate development. The
need for a holistic approach to secure economic, social and well-being
for local communities needs to be recognised.
The purchasing power of the public purse should not
be under-estimated. For example in Birmingham a Procurement Policy
Framework has been adopted to ensure social benefit clauses are
incorporated within contracts to realise economic benefits for
priority target groups (including apprenticeships, training and
work experience). A similar approach by other public agents could
achieve enormous impact locally.
What action should the Government be taking to
attract money from (a) public and (b) private sources into regeneration
schemes?
The availability of loans and grants to meet up front
costs such as land reclamation and purchase is important. Bank
lending has become risk adverse and initiatives to promote greater
liquidity and lending to support growth and businesses would be
welcomed.
TIFs and ADZs will be part of the solution as will
initiatives to raise and retain elements of local business tax.
It is right that where local authorities have encouraged and enabled
businesses to locate and expand within their area that they should
benefit from the benefits that accrue, including business rates.
How should the success of the Government's approach
be assessed in the future?
As the lack of finance is a major stumbling block
for regeneration schemes and market confidence, we suggest that
a key factor for measuring success of the Government's approach
is investment unlocked. This could be measured by benchmarking
investment returns from regeneration schemes to compare against
the IPD property index.
Secondly success needs to be measured at a local
level and the impact it has on neighbourhoods in terms of income,
employment, skills etc and closing the inequality gap between
the neighbourhoods with the highest deprivation and the city average.
This has been the approach taken in Birmingham in targeting its
priority neighbourhoods.
March 2011
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