Examination of Witnesses (Questions 160
- 171)
TUESDAY 6 JULY 2004
MR REG
HASLAM, MR
STEVE WEAVER,
MS JUDITH
SALOMON, MR
MICHAEL GALLIMORE,
SIR HOWARD
BERNSTEIN AND
MR DAVID
CARTER
Q160 Lord Brooke of Sutton Mandeville:
My understanding is, when the Minister visited Manchester
in the context of the Licensing Bill, it was established there
was a 25% excess of provision of licensed premises in the Manchester
city centre.
Sir Howard Bernstein: Yes, there
has been a very significant increase in all sorts of types of
investment within the city centre in the last three or four years.
I would not necessarily believe that is simply because of the
use classes order or the planning system, it is a reflection as
well around licensing and enforcement and what sort of city centre
we are creating.
Chairman: Thank you very much.
Q161 Tony Wright: I think we have
probably touched on this particular area in terms of what the
Government's direction is. Do you think the Government is right
to direct the location of regional casinos to town and city centres?
If so, what implications do you think this could have for the
nature of casino developments?
Ms Salomon: It is important to
remember, assuming this direction is by means of PPG 6 or PPS
6, it is town centre first, not town centre only. An applicant
would apply the sequential test in choosing a site to demonstrate
what is appropriate. As that is a fundamental principle of the
planning system, it is clearly something we support. Draft PPS
6 is clear that local authorities need to be mindful and realistic
in considering whether sites are suitable, viable and available,
and that is particularly when it comes to regional casinos. If
you look at the size and the need for other facilities, they have
to be realistic about whether there are sites of that size within
the city centre, and if they are not, clearly they look to the
edge-of-centre and then out-of-centre. This draws in the issue
about accessibility. Clearly it needs to be accessible by a choice
of means of transport; public transport being high up on that
list. But I think one has to be realistic with respect to these
casinos about people wanting to drive to them, and we have touched
on how late the tube runs, the desirability of night buses, et
cetera. Peak gambling is between 10 pm and 2 am and if you are
out at that time the chances are you will want to drive, and therefore
local authorities and regional planning bodies will have to be
realistic about carparking provision, and again that might have
implications with respect to town centre locations. But it is
town centre first, not town centre only.
Q162 Lord Mancroft: What type of
planning gain could an area negotiate with a casino developer
under a section 106 agreement?
Mr Haslam: The guidance on section
106 agreements is clearly changing. There is good practice and
that is going to be added to. The requirement is for transparency
from a local authority; transparency in the actual development
or assistance or support it seeks to obtain from the developer,
and transparency in how the amount of assistance is negotiated.
There is also a requirement on local authorities to express in
their development plans their expectations in terms of section
106 agreements. Blackpool is in a position where it has a statutory
plan, a deposited plan, which has a casino quarter allocated within
it. There is a requirement on casino developers to submit social,
economic and environmental impact assessments; positive responsible
assessments with each application, which is a pre-requisite for
approval. For example, in Blackpool, the social, economic impact
assessment, the responsible one, could mention, would mention,
would be required to mention, marketing, and therefore in that
section 106 legal agreement we would require from casino operators
co-operation in national marketing, so we do achieve the genuine
resort destination casino where, if you did a straw poll within
a casino in a redeveloped, regenerated Blackpool, we would expect
90 per cent of the customers to come from elsewhere in the nation
and hopefully some from beyond UK boundaries. So that marketing
application would be there if there is transparency in the way
the plan is written.
Mr Carter: I would identify five
areas here. The first one would be jobs, having things like local
employment pacts, training for construction phases as well as
the end-use workforce, but also for occupiers to work with job
centres and councils in terms of recruitment. That is something
we have done in relation to the new Bull Ring development, and
there something like 2,500 of the jobs were taken through that
recruitment process. They were from the areas of greatest need,
ie mainly inner city areas. The second area would be transport
improvements, particularly public transport for city centre locations,
for instance, contributions to light rail routes and that sort
of thing. Another area would be public art, where we have a per
cent for art policy. Then there are local environmental improvements
to the public areas. Finally, perhaps, small scale but very important,
some sort of shopmobility-type scheme for people with disabilities.
In actual fact, those would all be tied up in a legal agreement,
but most of the operators we have spoken to would see this as
a benefit in them signing up to those in any event.
Ms Salomon: I think it is important
to remember that under the current regime and current Circular
197, planning gain is about mitigating the impact of development
and must be related in scale and nature, so I think it is very
difficult to be prescriptive about what can be expected. However,
guidance can be given about what best practice might be, and we
have heard some of those areas, but it is very hard to be prescriptive.
There is considerable doubt over the new regime under clause 26
of the Planning Act, which did introduce the concept of a planning
charge, but this has now been significantly delayed as the Treasury
look at their model of planning as a result of the Kate Barker
Report, and the ODPM look at how they might implement the charge.
The Government has said we are unlikely to see any significant
change until early 2006, so we are still operating under 197 until
then.
Sir Howard Bernstein: The City
Council is the land owner. The proposals which we hope to announce
tomorrow following negotiations, and the bidding process, involve
a casino of less then 10% of the total floor space will include
a multi-purpose arena for nearly 3,000 people, retail areas, a
hotel, a skills training capacity, a house a sports concept building
upon the work we have been doing around a sports city in Manchester
in terms of coalescing different governing bodies of sport and
sports facilities to promote not just sports activities but also
further investment in sport as part of our economy.
Q163 Chairman: This is the site by
City of Manchester stadium?
Sir Howard Bernstein: Yes. The
proposals also include a sports hall, urban sports outdoor and
indoor areas. Our view is that if you are talking about delivering
the outcomes which we have discussed earlier, which are summarised
again in paragraph 3 of our submission around employment, inclusion
and creating sustainable communities, we believe local authorities
using the planning system and their land holdings where that is
possible can deliver those outcomes.
Mr Weaver: This brings it back
to Tony Wright's question earlier. If the gains from these are
simply seen in terms of section 106, what is the most that someone
can pay by one means or another for a development, that is not
about regeneration, it is not about linking to a local economic
strategy, it is not about linking to a regional economic strategy.
In terms of East Manchester, there is a clear emphasis there on
how it fits with a strategy for the urban regeneration strategy
in East Manchester, and that is why a national guidance as to
what they want to see achieved from a plan led system should be
there. The regions have regional economic strategies, and the
locations where these exceptional developments should take place,
should contribute and fit in with that. If that is the case, what
follows will naturally be something that is appropriate to that
particular region and to that particular location. If it is not,
all that will happen simply is that there will be a buy-in system
for what section 106 could buy, a local library, contribution
to a school or whatever, and that is not about regeneration.
Lord Mancroft: What impact will section
46 of the Planning and Compulsory Purchase Act 2004 have on planning
gains?
Q164 Chairman: Ms Salomon has already
referred to this.
Ms Salomon: Theoretically, through
the planning charge, local authorities in their local development
documents will set out the elements they think can be applied
to this sort of development. The problem is that this reform has
been delayed while the Government is assessing two parallel tracks
of planning gain reform. One is a Treasury-sponsored planning
gain supplement, and the other is the ODPM planning charge. There
will not be any significant change until early 2006, so the current
regime will remain in place until then.
Q165 Viscount Falkland: Do you think
that the regeneration benefits will be more difficult to achieve
now casino operators are not obliged to provide them? This, of
course, is in stark contrast with France which we visited, which
was of great interest, where regeneration is absolutely required
and rather narrowly targeted, as one would expect where historically
only spas and resorts have had permission to operate casinos,
and the regeneration has been aimed particularly at culture and
tourism, which might apply obviously to casinos in tourist areas
here. What is your general view about that?
Mr Haslam: If there is a plan
led system—and I was slightly concerned earlier when Tim
Hill was saying so many dittos in terms of numbers of sites—there
is a clear assessment regionally of the potential capacity and
a plan is produced and informed by views about numbers and the
sites at locations are restricted, and then I believe authorities
will be able to obtain major regeneration benefits. I guess in
a number of locations there will be ownership which will allow
clearly a different kind of negotiation, but if there is a plan
led system I believe the opportunities to negotiate genuine regeneration
benefits will come.
Mr Gallimore: If the ground rules
are set sufficiently clearly that there is an intention that casinos
should deliver these wider benefits, clearly that will be available.
I think the concern comes back to one of timing, that the whole
system of planning obligations is up in the air at the moment.
As Judith has said, developers or operators strictly are only
required to provide benefits which are directly related to the
development in question, and I am sure the authorities will be
looking to secure wider benefits. I think that raises a concern
that there could be challenges by other parties if the existing
rules are stretched beyond what is legally permissible.
Q166 Chairman: In your previous answer,
Mr Weaver, you seem to be suggesting that planning gain and regeneration
are not necessarily quite the same thing, and that in many respects
we could end up eventually seeing developers having to contribute.
In other words planning gain by itself does not necessarily contribute
regeneration.
Mr Weaver: I think that is an
issue. It could be described as taxation by the backdoor if it
was used in the wrong way. Regeneration is about transforming
a community and an area. I think that is where the national guidance
comes in on what they want out of the plan led system and how
regions and local authorities can work together to agree where
regeneration is genuine regeneration and not simply buying a development.
Q167 Chairman: Forgive me for being
cynical but might it be that the reason why the Government's response
to the Committee did not entirely reject our view about regeneration
but did not entirely accept it either, and seemed to be looking
both ways, is there is this complication of what is going to happen
to the section 46 fixed tariff regime, and until that is clear
it is very difficult to see what further regeneration requirement
you can then impose on developers?
Ms Salomon: The regeneration benefits
are not purely what is provided through planning gain and in cash.
It is important to remember these are significant developments
which will deliver benefit in their own right. A large regional
casino will probably employ in the region of 3,000-odd people.
Q168 Chairman: It is the effect?
Ms Salomon: Yes, putting that
in an area like Wembley and making sure the local population is
trained and able to take the jobs is going to build a significant
regenerative benefit on its own, irrespective of what would be
achieved through planning gain.
Q169 Lord Wade of Chorlton: What
impact do you think the Government's proposals will have on attracting
international investors?
Sir Howard Bernstein: Considerable.
Certainly in the context of our recent experience, we are talking
about a development which will have a capital value of well in
excess of £250 million, which I think in the context of what
we are trying to deliver in Manchester and East Manchester in
particular will represent a very, very significant stimulus to
the local economy.
Mr Carter: From the discussions
we have had with the operators, I cannot recall anything in terms
of the definition of size which seems to cause particular problems.
I think the thing which could be particularly damaging is excessive
delays. If the idea was that we had to wait, in the West Midlands
case, for a review of RPG policy which could take three years
to achieve, that could have a very damaging impact.
Mr Weaver: One of the things which
is essential is clarity; for the market's response to investment
to come in from abroad on the scale and nature we want across
the UK we need absolute clarity. That brings it back to this Use
Class Order and prevention of the spread and proliferation of
planning permissions being granted now, because that creates confusion
in the market and will not enable the kind of developments and
investments we are looking for.
Q170 Chairman: I think we have clarity
from the Government because they agreed with us on a 1,250 limit
for the number of potential category A gaming machines. Do any
of you think that would discourage the kind of approaches you
have in mind? What was proposed originally, if I remember correctly,
in East Manchester was a much larger proposal than 1,250 gamine
machines?
Sir Howard Bernstein: Not as far
as I recall, Sir. We have always understood the maximum was 1,250.
All the participants in the bidding process submitted on the basis
of 1,250.
Chairman: They are satisfied with that.
That is very encouraging.
Q171 Lord Brooke of Sutton Mandeville:
I have a London question for Ms Salomon, and I should preface
it by saying I have read the representations which London First
and London First Central produced on 1 July 2004 following the
Government's response. In your earlier submission to the Committee,
you noted the Government had not been clear in expressing the
economic rationale for its proposals. Do you think the latest
proposals clarify the Government's position?
Ms Salomon: I think they do in
that I do not think there is an economic rationale, and the economic
rationale is clearly one of up-dating out-of-date legislation
and protecting the vulnerable and guarding against proliferation.
I think some of the confusion rested in this term "resort"
and some of the implications which came out of that. I think it
is quite clear that whilst there is clearly economic opportunity,
it is not the rationale for deregulation. Having said that though,
there is a massive opportunity and it is very important, as we
have just said, to make sure the policy framework is clear and
clarified quickly in order that we realise that opportunity.
Chairman: Thank you all very much. It
has been a long session for all of us and we have another long
one this afternoon. I thank all of you for your attendance, some
have travelled a long way to be with us. We are very grateful
to you for your time and the clarity of your answers.
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