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Ms Candy Atherton (Falmouth and Camborne): Will the hon. Gentleman give way?

Mr. Foster: I will happily give way, especially if the hon. Lady has an answer to my constituent's concern.

Ms Atherton: The hon. Gentleman talks about the south-west, where the regional development agency is making massive strides in Cornwall. Is he suggesting that the more deprived areas of Cornwall should be giving money to Bath?

Mr. Foster: The hon. Lady entirely misses the point. The question is how we define a deprived area. Is an area considered deprived only if it is very large? That is the way in which the current system operates. I hope that she will acknowledge that, for example, relatively small areas such as Snow Hill in my constituency--I am sure that she has similar estates in hers--need a great deal of support, well beyond the resources of the local council to provide. Yet, because of their size, they are denied access to the many different initiatives that have been introduced by the Government.

I hope that the Minister will respond specifically to my constituent's concern, which is no doubt shared by many other right hon. and hon. Members, as to what will be done to provide funding for those smaller areas. At the same time, we welcome the support given to the hon. Lady's constituency and to Cornwall itself, which I recognise is a particularly deprived part of the country.

Some 2,500 projects have stemmed from the 53 initiatives to which I have referred, and there is huge overlap between the schemes. The other problem is that the Government have a tendency to launch project after project, announcing how much money will be available for them, but we never subsequently find out what has happened to the money that has been announced. For instance, the Government announced that £112.5 million would be made available for the new deal for communities project. However, only £48.7 million was spent, because it was difficult for people to find their way through the bureaucracy and the bidding scheme within the required time scale.

The Deputy Prime Minister has frequently referred in the Chamber to the Coalfields Regeneration Trust and its work. Of the budget of £27.7 million allocated to that project, £26.7 million is unspent. It has spent only 4 per cent. of its budget within the time frame.

The Minister for Local Government and the Regions (Ms Hilary Armstrong) indicated dissent.

Mr. Foster: The Minister shakes her head but my figures are direct from the Library. If she wishes to challenge them, I will be interested to hear her figures. I will give her another figure. Of the £80.8 million that the sure start project was allocated, it has spent only £19 million in the time frame.

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Often, the money cannot be carried forward to subsequent years. Early excellence centres spent only 41 per cent. of the budget and employment zones are underspent by a total of £27 million. The single regeneration budget is underspent by £44.5 million in the past three years. The European regional development fund is underspent by a staggering £250 million, which is more than 10 per cent. of its budget.

I hope that we will hear from the Minister whether the Government plan at least to allow those underspends to be carried forward to subsequent years. I hope that they will recognise that one reason why the money has not been spent is because of the bureaucracy of the system--not because there is no need for it--which makes it difficult for people to get their hands on it as quickly as they would like. I hope that it is not a case of the Government making announcement after announcement, but not being concerned about what happens next.

Mr. Mike Hancock (Portsmouth, South): Before my hon. Friend moves on, is there any evidence to show that underspends can be carried forward in certain circumstances? If so, will my hon. Friend give us examples? In my experience, it has been difficult to carry forward any of the money.

Mr. Foster: My hon. Friend asks me to cite examples. No doubt the Minister will talk about the Coalfields Regeneration Trust in her reply, which can carry forward the money. Unfortunately, many of the schemes to which I referred are not allowed to do so under current regulations.

Notwithstanding the problems, there are a number of good examples of regeneration schemes, which are particularly successful when local people have been directly involved. In the past few weeks, I have had the opportunity to spend a number of days in Liverpool looking at some of the work there, which covers a wide range of areas that encompass what we would define as urban regeneration.

In Liverpool, area committees play an important part and make many decisions that would in the past have been made by the council, liaising directly with service providers, establishing a variety of different partnerships and even employing people directly.

I was particularly impressed by the work of the North Liverpool Regeneration Company, which has set up a number of projects to employ people and give them opportunities to develop their talents and to make good use of premises that have been left empty for far too long. I was impressed by the work that it had done on anti-social behaviour in a unit that has brought together, in the spirit of all regeneration work, a range of different partners--education, housing, the youth service and many other agencies.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich): I am not clear whether the hon. Gentleman is saying that some schemes work well and some people can get through all the so-called bureaucracy, but that the money is not going to Bath.

Mr. Foster: I have a high regard for the hon. Lady, but she makes a strange point. I have been clear. So far, my argument has been that there are too many projects that

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overlap and that the Government announced large sums of money that, sadly, because of the bureaucracy of the system, are not fully spent, which is a waste. The bidding scheme for the money is hugely bureaucratic, which makes it difficult for people to get their hands on it. Despite that fact, it would be wrong to deny that there are some imaginative and exciting schemes from which we can learn. I was citing an example in Liverpool that builds on the approach for which the Deputy Prime Minister has called--involving local people to determine the way forward. I hope that the hon. Lady will agree with me and certainly with the Deputy Prime Minister that often--

Mrs. Dunwoody: I always agree with my right hon. Friend.

Mr. Foster: The hon. Lady says that she always agrees with the Deputy Prime Minister, but I have been in the Chamber on so many occasions when that has not been the case. On this occasion, she probably would agree. The Deputy Prime Minister believes--and I agree--that the people who live with the problem are best placed to find solutions, given support.

That is certainly the case in Norris Green in Liverpool, which urgently needs regeneration. The local community has come together and developed the ideas. With the support of the council, it has been given the opportunity to appoint architects, lawyers and advisers to help in the development of what seems, on the surface at least, to be an exciting way forward.

If the hon. Lady agrees about that, I hope that she will share my concern about another area where a different approach has been adopted. I have also visited Newcastle upon Tyne, where I was told about a so-called impressive scheme. The council introduced, "Going for Growth", and consulted the people, asking if they wanted improved public transport, job opportunities and green areas. Of course, the local people said yes. Only when they were confronted by journalists and television camera crews asking them what they thought about plans to bulldoze their homes did they begin to look at the so-called wonderful scheme in more detail and to discover that, although no mention of it had been made in consultation, it involved the demolition of up to 6,500 homes. Clearly, that is an example of where local people have not been directly involved as they should be.

The hon. Lady has given me an opportunity to summarise my arguments. The principle of what the Government want to achieve is right. I am genuinely concerned that the mechanism that has been adopted leaves us with too many diverse schemes with different funding regimes and with a complex bureaucracy, which is not the best way to ensure that the much-needed regeneration of our urban areas takes place.

7.48 pm

Mrs. Louise Ellman (Liverpool, Riverside): I welcome the Government's comprehensive approach to urban regeneration. This must be the first time that explicitly, as a matter of policy, economic, social and environmental issues have been brought together and tackled together in an integrated way. It is the first time that a Government have recognised the critical importance of co-ordinating and dealing together with approaches from Europe, central Government, the region, local authorities and communities in the locality.

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The real question is how effective the approach has been. During the past year, the Environment, Transport and Regional Affairs Committee has looked at what has been achieved and at the problems, and has tried to suggest how matters might be improved.

Liverpool is already benefiting from that approach. Unemployment in my constituency--the area with one of the highest unemployment rates in the country--has fallen by more than one third since the general election and is rapidly improving. There is new confidence and investment. Anyone who walks around Liverpool cannot fail but see the increased amount of development, construction work and activity and feel the buzz of the new confidence that resonates around the city.

Liverpool Vision--the first urban regeneration company to be set up after the Rogers report--is starting its vital work in the city. The company is working hard with the newly formed regional development agency--which the Opposition tell us they would abolish, if they have the opportunity to do so--Liverpool city council, English Partnerships and a wide range of private sector partners. It offers Liverpool a unique opportunity for urban renaissance by investing in the city centre and developing it as a spearhead of growth. The company deserves support. It will be successful if it is able to call on funding and support from all the areas that I mentioned--Europe, the Government, the region and the locality--to enable it to fulfil its major challenge.

The importance of businesses in our economy--specifically in Liverpool's economy--has been recognised. Much of that is due to the pioneering work of the Merseyside special investment fund, set up in 1996 with greatly valued objective 1 European funding, Government funding through the single regeneration budget and private sector investment. Since then, the MSIF has generated investment of more than £84 million for small and medium-sized enterprises, supporting about 4,800 jobs.

Following that lead, the North West development agency is promoting its venture capital fund. I very much welcome the Government's initiative in setting up the Phoenix fund and announcing incentives in the pre-Budget report to back inner city enterprise, providing community-based funds to support businesses in inner cities throughout the country--specifically in Liverpool, I hope.

The knowledge economy is being promoted. After the disappointing decision about Daresbury, major efforts are being made and I hope that regional projects of great economic and scientific importance--including, among others, Liverpool university's centre for accelerator science, imaging and medicine project, and John Moores university's proposals for the development of telescope technologies--will go ahead, and will receive support from the north-west science committee, which is currently considering them.

The North West development agency and English Partnerships are certainly showing the importance of land assembly in promoting brownfield development. The additional funding for RDAs by the Government, together with the increased flexibility in its use, will enable them to become more important in supporting businesses, the economy and society.

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