'We have the vision, we have the funding and we have the determination for a step change'

The decisions that lie behind my Communities Plan have not been easy. At the heart of the plan is a vision for creating sustainable communities that put people first. Modern, vibrant communities that we can all be proud of. Communities that will stand the test of time.

There is real enthusiasm to press ahead. That is exactly what I am determined to do – press ahead to deliver.

Step change
In my statement to parliament last July, I talked about a step change in our policies. The Communities Plan really does signal a step change.

This investment delivers £22bn under the plan, a 38% increase over the next three years. That includes doubling investment in affordable housing to £5bn, including an extra £1bn for key-worker housing.

We have launched a major new programme to tackle low demand and abandonment spearheaded by nine pathfinder areas with a £500m fund over

the next three years.

This will help relieve some of the immediate pressures but, in the longer term, we must get serious about tackling the underlying housing shortage in London and the South-east. I will be working hard with local authorities to ensure we increase the supply of housing.

Yet we will need to do more than this, which is why I want to accelerate the growth areas. I am making £610m available over the next three years for the Thames Gateway and the other three growth areas to create new and expanded communities.

To achieve a step change in housing supply, we need to build homes more quickly, more efficiently and to higher standards. This means a drive towards modern methods of construction, and modern standards of design and sustainability. We've already increased the funding for the Housing Corporation to provide an extra 3000-4000 off-site homes this financial year. And we've now set them a target; from 2004/05, 25% of new homes they fund should be off-site manufacture.

This will require positive and proactive changes to the planning system, and I will be asking the Audit Commission to assess the performance of authorities in delivering the right sort of housing, in the right quantities and in the right places. I do intend to take action, including intervention when planning authorities do not deliver.

The local environment makes a huge difference to whether people feel their area is a place they want to live. We are providing an extra £200m for this, including an £89m liveability fund for parks and public spaces.

As the chancellor said in this week's budget, we want the regional development agencies to take a more proactive role in linking regeneration with housing. We want them to work with local authorities to establish Enterprise Areas in our most deprived wards.

Urban regeneration companies can make a real difference to people's quality of life – helping to build a successful future for their area. That's because they bring together local business, local government and the local community to kick-start regeneration and encourage business confidence and economic growth – creating places where people want to live and work.

We have 11 urban regeneration companies across the country, and this week we announced three new URCs, West Cumbria & Furness, Sandwell and Derby. This brings the total to 14 across the country.

I also want to ensure that programmes such as New Deal for Communities and neighbourhood renewal link much closer with the Communities Plan. I've visited many of these areas and been impressed, but they need security in their funding and this is why I have also announced this week a further £800m for the 88 neighbourhood renewal areas for the next two years. This is in addition to the £2bn we've already allocated to the 39 New Deal areas.

Housing and communities
I am determined that housing should not be the sole focus of what we do. That would risk repeating the mistakes of the past 30 years.

When we invest in housing, whether it is new social housing, renovation or privately built housing, we must do this in a way that creates places where people want to live – communities.

The delivery process has begun, the first two public private finance initiatives contracts have just been signed – one in London and the other in Manchester – which, combined, will see nearly 3000 council homes brought up to the decent homes standard within three years. We want to speed up the process for others and are starting to put in place the recommendations of the PSA Plus Review.

I also hope the proposals in our draft Housing Bill for licensing bad landlords will be welcomed in the low demand areas. In June, we will set up teams with local authorities to clamp down hard on abuses where we can.

Local authorities are also keen to get on with delivery. My department has received 25 expressions of interest for the 2003 transfer programme covering over 100,000 homes. Half of these are for partial transfers with authorities taking advantage of the new flexibilities we have introduced.

In total, we are investing £2bn for new arm's length management organisations over three years. There is already evidence that ALMOs are greatly impacting and improving the quality of life of communities and its residents.

Fifteen local authorities have expressed an interest in round three ALMOs and we will be consulting in the summer on how we can give the highest-performing ALMOs further freedoms and flexibilities within the prudential borrowing regime.

I have asked Baroness Dean to chair a new homeownership taskforce to look at how we can safeguard our social housing stock at the same time as helping people, particularly those on lower incomes, own their own home. Dean will be reporting back to me in the autumn.

Partnership
Another key theme underpinning the plan is partnership. Central government cannot achieve alone the agenda we have set out.

Low-demand pathfinders are a good example of partnerships. Local authorities and other key stakeholders have formed their own partnerships and are developing their own pathfinder plans to tackle low demand in their areas. There are nine pathfinder schemes altogether, which have been allocated an initial £500m to tackle low demand over the next three years.

This is not a race and each pathfinder may come up with a different solution. However, three are developing strategies and action plans and will be implementing them during 2003/04. The remaining six schemes should be agreed for action in spring next year. I also want to increase the pace of change in our growth areas: Milton Keynes and the South Midlands Area, Ashford, London Stansted and the Cambridge corridor and the Thames Gateway. Our focus is on creating sustainable communities and increasing housing supply.

By the end of the year, we plan to have at least shadow arrangements in place for two new urban development corporations in Thurrock and East London. These new agencies will work with local authorities, not against them.

Decentralising
While I was preparing the Communities Plan, I was struck by the different challenges affecting different regions. Indeed, I have seen for myself the problems of low demand in Lancashire and in my own constituency in Hull.

People in London and the South-east, for instance, find it hard to believe that homes can change hands for just a few thousand pounds in other parts of the country. And even within regions, there can be housing hotspots and areas of abandonment close by each other.

That is why it is no longer possible for the government to develop a single set of policies for the whole of England. More decisions and responsibility need to be taken at the regional and local level.

In the consultation document Your Region, Your Choice we set out our proposals for regional government. Those regions that choose to set up elected regional assemblies will take direct responsibility for many of the areas covered by the Communities Plan, for instance housing. This will allow regions to develop their own strategies and allocate their resources to support them.

We can secure some of the benefits of this approach without elected regional assemblies. So we are setting up regional housing boards to bring more flexibility and a regional perspective into the system.

Housing strategies will be developed alongside economic and planning strategies to ensure our investment in housing and jobs are properly planned and support each other.

In developing the Communities Plan we have brought together our policies for planning, housing and regeneration.

You can't transform communities overnight, but I'm determined to make changes. We've put the foundations down for the long term.

We have the vision, we have the funding and we have the determination for a step change. Not just in housing, but in design, liveability and in how we plan for sustainable growth – a new agenda, a new urbanism and a new approach to our thinking about where we live and how we live.