Raiding the RDAs

Social worker Robert Quinn has been a resident on Anfield Road for 16 years, an area more famous for the glory of Liverpool football club than the desirability of the neighbourhood. By the late nineties it had become a byword for crime and dereliction. “It was a really bad place to live,” he says. “My flat was broken into almost on a daily basis at one stage. People just handed the keys back to the housing associations or to the mortgage companies saying they could not take it anymore.” Now it looks like attempts to regenerate the area could be hit by a £300m raid on regeneration funding by prime minister Gordon Brown to pay for his recent housing rescue package. Quinn feels betrayed. “The area was starting to change,” he says. “We had the masterplan in place for turning around the whole area. If we don’t get funding, the dream of making this community sustainable will not be realised.”

The £1bn housing package announced last month includes £300m lifted out of the budgets of the nine regional development agencies (RDAs) – quangos charged with driving economic development in England, on schemes as diverse as the Olympic legacy and the redevelopment of central Sunderland.

The government argues that, at a time when public finances are tighter than they have been for a decade, reassigning these funds is essential, and a missing £300m will not bankrupt organisations with about £6bn to spend over the next three years.

However, those involved in urban renewal claim it will hit development hard, just when we can least afford it. And those trying to deliver redevelopment schemes with a limited amount of RDA cash are concerned over just where the axe will fall.

That it will have to fall somewhere is in little doubt. Richard Ellis, chair of the East of England Development Agency (Eeda), says the decision to cut his organisation’s £130m budget by £1.5m in 2009-10 and by £20m in 2010-11 will force Eeda to withdraw approval for some of the developments that were due to start in the region in 2010.

“It will have a significant impact on long-term projects,” says Ellis, citing Yarmouth Outer Harbour and Norwich’s Hethel Engineering Centre and Epic media centre as just some schemes where any subsequent development could be jeopardised.

“Schemes that were starting will have to be shelved, and those that won’t start will affect those who were designing and planning them.” This will have a knock-on effect on an already beleaguered industry, he adds.

“The decision is disappointing, to say the least,” says Steve Broomhead, chief executive of the North West Regional Development Agency (NWDA), of the £50m cut to the body’s £1.15bn budget for three years to 2011.

Warren Bradley, leader of Liverpool council, says the drop in the NWDA’s budget will threaten plans to revitalise Anfield, Everton, Kirkdale and Walton. “It is really frustrating as council leader, but more so for the people who live in those communities who can’t see a light at the end of the tunnel,” says Bradley.

One of these people is Frank Prendergast, project manager for the Anfield and Breckfield regeneration. He is concerned that cuts could spell delays for the scheme, which is already moving at a glacial pace. “The masterplan was supposed to create jobs and bring the area into the 21st century. We’ve not seen great developments so far,” he says.

Hundreds of homes in the area were to be replaced by new properties, but more than 800 remain vacant and boarded up and have become a focus for crime and destruction.

Prendergast says this is devastating for community morale. “I don’t know how people cope, when empty properties are being vandalised and set on fire,” he says. “If we don’t get investment, what will happen?”

Misdirection

On 2 September, Bryan Gray, chair of NWDA, wrote to John Hutton, secretary of state for business, about the budget raid. In the letter, he questioned why a housing support package should be funded from the RDAs’ budget, when housing was not part of their remit. He said long-term funding for economic development was the best way of “mitigating the effects of changing economic conditions”.

Brown’s plan was designed to tackle the housing crisis and restore his crumbling reputation. The plan included waiving stamp duty on homes that cost less than £175,000, moves to help people keep their homes and a £300m initiative to help first-time buyers. The government hopes these measures will encourage people to buy homes and, hence, kick-start the housing market.

But for Prendergast, there is no guarantee the inhabitants of Anfield and Breckfield will reap any of the benefits. “The principle of regeneration in our area was to help local people get onto the housing ladder,” he says. “At the moment this is not happening.”

Dominic Williams, director of Hewdon Consulting, says: “The amount of money involved is hardly enough to tickle the pimple on the backside of the housing market.” In contrast, he adds, the move will hamper the RDAs’ ability to deliver vital schemes.

Eeda’s Ellis says the effect of cutting the budgets of RDAs is much greater than it would be if the same amount was cut from the budget of a private sector project. In addition, he says that the funding may be misdirected. “We carefully target our regeneration money to areas in most need,” he says. He does not believe the government’s package of measures would account for this.

Short-term thinking

A communities department spokesperson says: “It is right that we deal with the immediate pressures in the housing market and help people who wish to buy homes.”

But, for many, the move is an example of a worrying trend in this economic climate – that is, short-term politically motivated measures, devised mainly to appease a disgruntled electorate, taking priority over longer-lasting interventions.

Jon Ladd, executive director of the Urban Land Institute, says: “In urgent times we have to focus on the short-term to a degree, but the overarching strategy should be long-term investment.” If the government continues to cast aside long-term projects in an attempt to win approval, then, Ladd says, “we might as well forget about the regeneration work we have been doing over the past 10 years”.