Examination of Witnesses (Questions 60-79)
MR TONY MCNULTY, MR PAUL HOUSTON AND MR PETER ELLIS
WEDNESDAY 3 JULY 2002
60. But you would not rule out ministerial guidance if there was evidence that the evolutionary approach was not freeing resources quickly enough?
(Mr NcNulty) I certainly would not rule anything in or out five weeks into the job, but I do not think we would. There may well be, at the risk of over-speculating, occasions where given what is planned by EP in terms of their partnership, and I believe somebody beside me will hit me if this is otherwise, things like clawback could be waived if it was in the interests of the wider community interests in terms of that particular landholding and that particular scheme where EP is in partnership. Are we going to shift from that final evolution of best consideration to best value? Maybe. I think that is the fairest I can be.
61. Is there a real understanding in the Department that whatever the successes of the new towns, the real problem they have is that all their infrastructure is ageing at the same time and there is a need for substantial investment right across the field there?
(Mr NcNulty) I think there is certainly an understanding within the Department that that is what prevails in any number of our urban areas, new towns or otherwise.
62. They are different, so how can they be ageing at the same time?
(Mr NcNulty) Well, partly so and partly again because of some of the tail end stuff that I caught about specific design in other areas that were common to some of the new towns in their various ways. Saying that about urban centres generally is not in any way to diminish the specific difficulties that there are with new towns. Some of the new towns in some cases, as you say, their stock is deteriorating together and where English Partnerships or the Government can have a role to arrest that, I am sure it will happen, so there is that recognition, I think.
63. Does the Government recognise how much money it is going to have to put into this process itself?
(Mr NcNulty) Well, in a kind of tangential way because we are doing, and, as I understand, it is part of Stage Two of the Review, almost a root and branch assessment of every little thing that moves in terms of EP's ownership, but hopefully, and I think this is prevailing again in terms of what you were saying about strategic sites and non-strategic sites, hopefully within the context of if they are to dispose, to dispose in what context, for what advance in terms of strategy and everything else, and that must mean not simply in terms of land disposal, but in the broader context. You have heard already some of the examples of what EP are doing with some of the new towns and I take the point about the speed at which they do it and that may well be a feature of Stage Two of the Review as well. So can I come to you, or promise to write to you, with the bill for renovating, refurbishing and updating every single aspect of defect in every single new town? I suspect the answer is no. Are we going to be a lot further along the road to knowing exactly what is needed in the context of development in all these areas? Certainly, by the time of the end of Stage Two of the Review, we will be a lot further along that curve than we are at the moment and that is part of the real focus for it. I was saying to someone earlier that there is this really interesting tension where new towns want almost to be grown up, and that is not meant pejoratively, but they have matured and have come into the mainstream and want to be seen as all other urban centres, but with a stronger recognition of from whence they came in terms of history and the particular problems as well as advantages that that brings. I think that is a really interesting tension and we need to kind of be addressing both of those. When I say "all urban centres", I mean treat new towns as any other local authority in that context, but as with any other urban centre, treat them with full regard for their history, their development, with the level of stock, the state of the stock and all those elements as well, which I think are fair points.
64. Have you been able to come to any decision in terms of where there are strategic sites and how they will be defined?
(Mr NcNulty) I am dreadfully sorry because this all really sounds like sort of pleading the Fifth Amendment in America or something, but that is all ongoing now as part of Stage Two of the Review and that is literally ongoing as we speak. I think and hope the plan is for that to be done and signed off in every way by the end of the Recess, and I have not heard otherwise, but it really is part of that process and I am not party to that at this stage. With my ministerial colleagues, I guess I will be at the tail end of that when the Review reports, but it would be entirely wrong for me to speculate about that given that this process is unfolding.
65. In terms of your own position, how do you see you categorising strategic sites?
(Mr NcNulty) Well, in essence, and I know there are kind of two or three definitions, but, in essence, I would see strategic sites in terms of EP's holdings as those that may in the future assist the Government in the pursuit of its objective, be it housing, employment or any of the other areas that are outlined. I think that is a fair distinction. I think that is a useful distinction, but it is one which hopefully will be seen in all its glory when Stage Two reports.
66. You did indicate that we should be looking forward and not backward, but sometimes it is best to look backward to move forward, and it is very clear that if you do not start to invest in the assets, as they are assets at present, in the future these assets become liabilities and very clearly the evidence that we have and indeed what I see for myself on a daily basis in my constituency is that these assets are very quickly turning into liabilities and it is all down to the fact that they never got to the levels of populations that were predicted as being necessary to be able to bring about a complete community. Just exactly what would your opinion be as to what could be done to be able to overcome that obvious problem?
(Mr NcNulty) Well, I think you are exactly right in the sense that those who fail to learn the lessons of history are doomed to repeat them. I accept that entirely, and hopefully as part of the Review and the wider context of looking at new towns, those lessons will be learned. Just given the nature and disparity, although you can put them in, I guess, clusters around age and geographic locations and things like that, I suspect there are lessons, harsh lessons to be learned almost on a new-town-by-new-town basis. The key now in terms of going forward is for English Partnerships and development agencies and all the assorted partners to look at the new towns that are in difficulty on a case-by-case basis, literally history-by-history basis, and work out within their own localities how to take things forward to regenerate those areas. That is why in the broader context of our plans for urban regeneration anyway, but also in the specific locality, that is happening. You have heard some examples, Woodside, Telford and stuff like that, and Castlefields up in Runcorn, I think, where Halton Borough Council, RSLs and the housing corporation are all working together. Is it happening too slowly? That is always in some cases a fair charge, but is it happening and is there progress in the right direction? I think there certainly is.
67. Can I just take you to another aspect of this because there are differences between Scotland and England. I am not suggesting for a minute that in five weeks you will have been able to get yourself to Scotland to look at the differences
(Mr NcNulty) I nearly did, funnily enough.
68. Well, you are going to be looking at the comparators of what has happened in Scotland and what has happened in the rest of the United Kingdom, I presume.
(Mr NcNulty) Well, even though my brief is pretty well exclusively England, absolutely. It was kind of an aside, but I was very close to popping up to Dundee to see some very good work on a family enhancement-type programme, anti-social behaviour and all that sort of thing with one of my other departmental hats on, so I am more than happy to cross the border if it means visiting good practice and not reinventing the wheel, but to see how the Scots have made things work in ways that we might learn down here and I am sure there are plenty.
69. I will tell my local press that you are coming to Cunninghame.
(Mr McNulty) You can tell them but do not give them a date.
70. Minister, can I ask you to speculate on when there will be progress on the transfer of these non-strategic sites to local authorities?
(Mr McNulty) I would hope as soon after the completion of the second stage review as is practicable.
71. You will not be drawn more precisely than that?
(Mr McNulty) I do not know what is in the second stage of the review or the quantum of strategic sites versus non-strategic sites, so it would be unfair to put
any firm timetable on it. Is there anything more to add to that?
(Mr Houston) No. The aim would be to effect the transfers as early as possible. I must point out that the conclusion of the first stage was that the transfers should be to the most appropriate body which might not in every case be the local authority.
72. Can you give us one or two for instances of people other than the local authority who might be appropriate?
(Mr Houston) In a purely theoretical way the Regional Development Agency could be a transferee. I just thought I ought to make that point to the Committee. I fully support the Minister, the aim is to do it as quickly as possible. The aim is to do it as quickly as possible but you will appreciate that these matters involving finance and legal issues do take time.
73. So how much progress are you making on drawing up what the level of liabilities will be and what balancing packages will go with the liabilities when you transfer to local authorities or these other third parties?
(Mr Houston) A lot of work is going on by English Partnerships, I understand, into looking at the exact nature and size of the liabilities and the assets.
74. Can I ask you about the transfer of planning powers to local authorities because that has already been agreed. Is it not a bit irrational? Why can you not just transfer the planning powers now to local authorities? Why has that got to be gradual?
(Mr McNulty) Because that would prejudge what is a strategic site and what is not a strategic site, so you cannot do that globally and overnight. That really is something that will emerge fairly swiftly after the second stage of the review. If you transfer planning powers now universally then you may beI do not know because, again, this is in the realms of speculationundermining the whole notion of why they are strategic sites in the first place.
75. If they are strategic and there is agreed action for it, the local authority is not going to refuse planning permission. There are lots of sites which Regional Development Agencies have at the moment that still require planning permission from the relevant local authority.
(Mr McNulty) That may well be the case but nonetheless it prejudges and presumes the outcome of the second stage of the review and I do not think that is appropriate.
76. Minister, as part of the review will you be looking at the possibility of ending the clawback arrangements? If it is not part of this review are you prepared to review that?
(Mr McNulty) I am not entirely sure if it is part of this review. I do not think it is, is it? These are largely Treasury driven things.
(Mr Houston) It is.
(Mr McNulty) It is? You answer it then.
(Mr Houston) The answer is yes.
(Mr McNulty) As I indicated earlier there will be, I am pretty sure, a will, where appropriate in exceptional circumstancesI suppose they will throw in phrases like thatto waive that clawback if that is part of the overall package in terms of an agreed way forward for a particular area. I am not saying by any means that is going to happen in nine out of ten cases but it is important to know that provision is there in exceptional cases.
77. As a matter of basic principle is there not a recognition in Government that the operation of clawback will be linked with the basic principle of best value because if you look at what is best for the site and how you might address it, you might find you cannot fund the regeneration that is necessary because the bit you sold off, the resources do not come back for regeneration, they go in the clawback. Is that not a real problem, that the best use is not being made of land in all cases because of that?
(Mr McNulty) As I say, that is part of the Review. If there are real exceptional circumstances like that, where the clawback is essentially the difference between a significant regeneration, refurbishment, modernisation project or whatever else happening or not, then it is something we will look at very, very seriously.
78. It might be that the authorities would say "we want to sell that site and buy that one" but they cannot do it even though there is a logic because, as I said the first time, it disappears in clawback. All of those sorts of arrangements are not possible in the current circumstances.
(Mr McNulty) I accept that and I think in the context of what I was saying earlier it may well be an evolutionary period, and the evolution ends with best value as opposed to best consideration or best price, I am not sure. Equally, these are not value free or cost free parcels of land that we are dealing with, they come with a degree of baggage in terms of finances and in some circumstances the clawback is appropriate. I do not know on a site by site basis where that starts and where that stops, that is part of the process that the Review is going through now. I would not say absolutely 100 per cent, which one senses is the view of the Committee, clawback is horrible and nasty and just gets in the way of things. In terms of the history of each of these on a site by site basis it may well be appropriate in terms of community assets that have been passed on and all those sorts of other elements in the history of each particular site. They might be appropriate. I would hope that we do get to a position post the second stage of the review when we are looking, as I know the Committee wants, very, very seriously, at how to go about the regeneration and all the other elements we are talking about, to look at those aspects when we are passing up projects, for particular projects to go forward with the regeneration of the new towns, that a review of clawback and how that fits in is part of the process. That is not to say it is going to be written off every time, I do not want to leave that impression, but it needs to be looked at.
79. You talked a few minutes ago about the new towns being grown up. Do you think they can be grown up organisations when they have all got the covenants that still exist around the place, there are things like the situation in Harlow where English Partnerships own the subsoil so they have to be consulted about things that they should not be consulted about? I think it was Hatfield who said that EP owns the ransom strips which means they have to be consulted. Are those not matters that ought to be dealt with and cleared off the decks?
(Mr McNulty) Longer term with the second stage of the Review and all that is going on now, I would hope so. I think English Partnerships have heard your message and will hopefully get back to you on it. I think that is right. They need to start from the premiseI do not know what the answer to this isare there absolutely compelling public policy reasons why English Partnerships own the subsoil?