Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Memoranda

Memorandum by Dr Peter Tyler & Colleagues, SRB National Evaluation Team, Cambridge University (GRI 09)


  Opinion as to what constitutes a local area regeneration problem can vary considerably but there are often a number of inter-related elements. The area concerned usually has a weakened economic base (perhaps as the result of the closure of a large employer in the area concerned). There are large concentrations of unemployed and socially disadvantaged residents and a poor physical environment often characterised by a high degree of physical dereliction. Once underway the problem seems to have a momentum of its own passing from one generation to the next. It is the cumulative nature of the decline that is the problem and a central question has to be why adjustment does not occur to remove the economic, social and physical imbalances. The persistence of the problem is perhaps the most worrying aspect. The problems of the most depressed areas appear to be resistant to solution by market forces and the operation of mainstream programmes operated by Government.


  A number of arguments have been put forward as to why over the last 30 years or so it has been appropriate for successive governments to use area based initiatives to do something about the problems faced by depressed areas. The rationale for intervention has been that ABIs are needed to overcome market and public sector failures that are preventing the regeneration of the areas concerned although it is worth highlighting at this stage that there has been considerable diversity of opinion as to what is the appropriate "geography" for the intervention. There has also been a very intense debate as to whether geographical concentration per se is, in itself, an important factor in the perpetuation of social exclusion at the local level with some arguing that it plays a relatively minor role relative to the socio-economic characteristics of an individual or their family. Whatever the precise size of the contribution it does seem that at the very least there are likely to be adverse peer group pressures and demoralisation that further exacerbate attitudes and the ability to embrace/change in the neighbourhoods that are affected.


  A wide range of national area based initiatives have operated across the United Kingdom. In England ODPM (formerly DoE and DETR) has been responsible for the largest number of ABIs although virtually all other Departments have operated some form of policy and DTI has traditionally been responsible for regional policy. Throughout the 1980s and into the early 1990s, many of the regeneration programmes were heavily focused towards land and property led economic regeneration (examples being Enterprise Zones and Urban Development Corporations). These programmes had the objective of overcoming land and property market failure, particularly in the inner cities. DoE was also mainly responsible for Urban Programme that began in 1969 with the main objective of seeking to provide financial support for investment in urban areas.

  However, by the early 1990s there was a move to supporting comprehensive area based initiatives that sought to tackle the economic, physical and social elements of the problem simultaneously since a considerable body of research indicated that focusing on any one or even two of these dimensions alone would not be sufficient to remove the problem. City Challenge was the first real departure from the traditional reactive, project driven approach that had been followed previously and it encouraged competitive bidding for regeneration funds from those agencies who it was felt should lead regeneration.

  City Challenge was followed by the Single Regeneration Budget (SRB) in 1994. The key and innovative features of SRB was that it sought bids for local area regeneration from local partnerships forged by the public, private, community and voluntary sectors. There were no restrictions on what objectives or spatial areas were eligible. The "boundary-less" approach was a radical departure from the previous twenty years and was designed to ensure flexibility so that areas that were beginning to experience difficulties could make an early response that might help to avoid the deep rooted and entrenched problems experienced by areas like the inner cities. Moreover, multifaceted regeneration schemes were supported that could be delivered over some seven years. Regeneration schemes could also be thematic in that they were designed to encourage innovative responses to particular aspects of the problem and assist mainstream departments as appropriate.

  Towards the end of the 1990s further changes have occurred to the policy landscape. The New Deal for Communities initiative placed emphasis on tackling multiple deprivation in deprived areas by focusing particularly on poor job prospects, high levels of crime, education underachievement and poor health in neighbourhood areas of between 1000 and 4000 households with up to £60 million available in each area over a period of up to ten years. NDC has been launched in 39 areas but there are no plans for any more. More recently following the cross cutting review of Government Intervention in Derived Areas (GIDA) under the Spending Review 2000 it has been argued that mainstream departments should seek more actively and aggressively to channel their resources into meeting the needs of deprived areas, particularly in the domains of jobs, crime, health, education and housing-so called "bending the mainstream". Public Service Agreement targets have been set following the publication of the National Strategy for Neighbourhood Renewal Action Plan in 2001. To assist in the achievement of these targets it was also announced that there would be a Neighbourhood Renewal Fund that would provide funds to Local Authorities in the 88 most deprived areas to help with the process of improving public services.

  However, it was still believed that there was a need for local partnerships to work to "join-up" and co-ordinate local regeneration endeavour and the chief vehicle envisaged to facilitate this was the Local Strategic Partnership (LSPs). LSPs have begun to roll out across the 88 Districts in England drawing upon, in many areas, the extensive partnership capacity building established by SRB and other regeneration programmes amongst the key local players.

  The Spending Review in 2000 also identified the key role of RDAs in encouraging economic regeneration at the regional level and they were further empowered by the receipt of new and flexible resources available from April 2002 in the form of the Single Pot.


  Although there has clearly been significant variation in achievement at the local level it is possible to draw the following broad conclusions about what ABIs have been able to achieve:

    —  There are specific features of land and property markets in depressed areas that necessitate action by Government as a precursor to sustainable regeneration at the local level and a range of initiatives operated by Government have been cost effective in this respect;

    —  Partnership working remains essential to the delivery of local area regeneration and has been enhanced enormously over the last ten years, particularly as a result of SRB and other similar initiatives elsewhere in the United Kingdom;

    —  Many of the factors that are important in bringing about social exclusion originate in the labour market and there has been much success in integrating local labour market policy with other local initiatives in tackling social exclusion. However, much more remains to be done, particularly in relation to welfare to work and reintegrating individuals into mainstream labour markets;

    —  There is a considerable body of evidence that area based initiatives have contributed to the attainment of regeneration outcomes by combining physical regeneration (eg developing sites, refurbishing buildings etc) with people related regeneration (eg providing skills training, community facilities etc), designing schemes that take account of changes in wider urban areas (eg the impact of transport initiatives in local labour markets), forging transport improvements and other links between deprived neighbourhoods and other areas where job opportunities are available, providing support for local businesses and training initiatives and bringing about changes in housing tenure and in particular secure the conditions for profitable private sector house building.

    —  There are many good examples of community involvement in building "bottom-up" solutions.

  There has been less success in relation to:

    —  Mainstream bending to more evenly meet the needs of deprived areas has been patchy and hesitant and this reflects the rigidity of existing mainstream funding priorities at the local level. There has been relatively poor targeting by mainstream providers to deprived areas and Standard Spending Assessments do not effectively compensate urban areas for the higher costs involved in tackling social exclusion. There has also been a lack of incentive and opportunities for residents of deprived areas to move from welfare to work and poor take-up of programmes by residents of deprived neighbourhoods. Problems have been exacerbated by poor coordination of mainstream programme spending and the more prosperous areas have managed to exert pressure to keep their level of relative service provision. Public sector spend in deprived areas has often simply "compensated" disadvantaged residents in deprived areas and maintained the "status-quo".

    —  Achieving long term sustainable solutions remains the big problem. For too many years there has been little change in the ranking of the most deprived areas with a tendency for "fixed-effects" which means the past ranking largely explains what we might expect it to be in the future. This cannot be seen as an acceptable outcome. Clearly, significant changes are required in the allocation of public resources to the deprived areas and the involvement of the private sector. In this respect the evidence suggests a role for ABIs to enhance the achievements of mainstream providers by improving the co-ordination of their regeneration activities, promoting a more strategic approach to their area based activities and assisting in the provision of effective partnership working that involves genuine community partnership involvement. The ABIs also need to be sensitive to the continued need to build involvement of the private sector in local regeneration-too long absent in many areas in the United Kingdom at the level required. A range of imaginative policy tools are now available to assist in involvement, particularly using fiscal incentives.

  Against this background the need for comprehensive regeneration initiatives to tackle geographical concentrations of social exclusion has probably never been greater. The evidence points to the need for area-based policies to improve the environment and physical characteristics of the areas concerned so that they become attractive places to live and invest in. Initiatives are also required to help mainstream providers to focus and target their resources on those in need and to obtain further engagement from the private sector so that the vicious circle of relative decline in the areas concerned can be broken. In England whilst there are clear advantages to the development of Local Strategic Partnerships there must be some concern about how effective these bodies can be without some substantial change in the way in which mainstream resources are currently allocated. Unless there is aggressive "top-slicing" of central mainstream budget to meet the needs of deprived areas it is likely to remain an uphill task.

  Further, in England the recent abolition of SRB does need careful monitoring in at least two key respects. The first relates to the involvement of the community and voluntary sector in local neighbourhood based regeneration. SRB funding has been used actively to reach down into deprived neighbourhoods and it is not at all clear how adequate resources will be available from the LSP/Neighbourhood Renewal Fund despite the existence of the Community Empowerment Fund. Community groups operating at this level would seem to be particularly vulnerable unless they are in a New Deal for Community area. Secondly, there are concerns as to a possible loss of momentum in engaging the private sector in regeneration at the local level. Much remains unknown as to how well the RDA Single Pot approach might fill the gap but it is worth mentioning that the SRB approach has been shown to be good at involving the private sector in local area regeneration. It offered a flexible response through a wide range of diverse and innovative approaches to secure and match funds. It is not obvious that this flexibility has been retained.

Dr Peter Tyler, Angela Brennan, Steve Stevens, Monica Otero-Garcia and Colin Warnock, SRB National Evaluation Team, Cambridge University.

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