Sustainable Communities Plan: Plan's success relies on two high profiles
Axis – 30 January 2004

East Lancashire and southern Cambridgeshire illustrate two sides of the government's approach to creating sustainable communities. Mark Smulian reports on the ongoing housing debate

Max Steinberg spent the last few weeks of 2003 putting the finishing touches to a prospectus that he hopes will net Elevate East Lancashire (EEL) a large slice of the £500 million on offer to the housing market renewal pathfinders. About 150 miles to the south, John Onslow spent the same period helping to decide how to put the £21 million growth area grant just awarded to Cambridgeshire towards a £2.2 billion infrastructure bill.

Not a lot unites east Lancashire and southern Cambridgeshire except that both have key roles in the Sustainable Communities Plan, the all-encompassing programme put in place by deputy prime minister John Prescott a year ago to create growth in struggling areas and channel it sustainably in booming ones. Although the plan contained polices on sustainable growth that are applicable generally it also outlined two high-profile programmes whose success or failure will be particularly obvious.

The housing market renewal pathfinders are designed to turn round areas where the demand for housing has collapsed so far that no commercial firm would contemplate building homes and most social housing can barely be given away. These cover some of the poorest areas of northern England and the Midlands (see box), which suffer intractable economic problems of industrial decline. Housing markets do not, after all, collapse of their own accord. They fail because local economies fail.

By contrast, the growth areas have been designated to deal with the problems of success in the South East where, far from collapsing, the housing market has been roaring ahead leaving unmet demand in its wake. To prevent a development free for all, Prescott designated four growth areas (see box) to accommodate the bulk of the new homes that the region will need, together with local employment and infrastructure.

Steinberg was formerly the Housing Corporation's regional director for the North West, and became chief executive of EEL in August. He rates the problems of east Lancashire as 'some of the most challenging I've seen in my career'. His task is certainly daunting. There are some 80,000 homes suffering from low demand, equivalent to 47 per cent of the total stock, and half of private sector homes are unfit. Vacancy rates hit 20 per cent in some areas.

Steinberg's submission to the ODPM proposes a three-year programme to start to tackle market renewal, within a 15-year vision, by building on the area's strengths. 'One thing that is going to be a major issue is design quality,' he says. 'The local environment of the Pennines provides a beautiful backdrop and the surroundings could be a big bonus. There are stone buildings that are very attractive, and we want to make the environment a feature to attract investment.'

Steinberg is convinced that he cannot tackle housing market failure without taking on the area's underlying weak economy, which has had knock-on effects in poor education and health records. He says: 'I believe our economic emphasis is right. The housing market failure is a consequence of wider market failure. Simply concentrating on housing would not tackle it.'

EEL commissioned consultancy PwC to report on the area's economic prospects.

The resultant report found some 'interesting green shoots with some digital industries'. But the area's industrial decline has gone on over decades, and many of those with get up and go have got up and gone.

'We see the town centres as the new hearts of a revived east Lancashire," says Steinberg. 'There has been a flight to outer suburbs and villages and if you look at development in the area 95 per cent of it has been along the M65 and not in the towns. We are trying to stop that by providing an attractive mix of housing in the centres.' Although Steinberg expects to demolish some of the over-abundant two-bedroom terraces, he stresses that demolition is not in itself the key to progress, nor likely to be widespread.

In addition to their economic problems, many east Lancashire towns were the scenes of riots in 2001 and have seen racial tension since. Inquiry reports cited competitive bidding between neighbourhoods for regeneration funding as a contributory factor, causing resentment because of a perception that one group or another was unfairly favoured.

Steinberg is careful not to become drawn into this argument. He says: 'We will be working in areas that are seen as both Asian and white, but I don't want to look at areas in those terms as that is a road to nowhere. We invest in communities, full stop.'

It has to be said that there is little unfit housing or racial tension in the area between Cambridge and Stansted Airport, where John Onslow, assistant director of environment and transport at Cambridgeshire County Council is responsible for managing growth in a key section of the M11 corridor. The rest lies in Essex.

Onslow says the Sustainable Communities Plan largely only formalised what was happening anyway, with high growth pressures in the corridor leading to plans for the bulk of the county's growth to take place within a 15-mile radius of Cambridge. The county had to increase its housing growth targets by 40 per cent. 'Growth is driven by the imperatives of the local economy and its high tech and research industries,' he explains.

Provisional confirmation has come of £21 million of growth area grant, which is welcome but a long way short of the £2.2 billion that Cambridgeshire thinks is needed. About half of that sum is for transport infrastructure, including upgrades to the A14 and rail services. The remainder is utilities, education and affordable housing.

'The Sustainable Communities Plan emphasises the need for an effective delivery vehicle mechanism, so we have set up the Cambridge Infrastructure Partnership with the districts and other key stakeholders without which it would have been more difficult for the county to create an effective plan,' says Onslow.

Cambridgeshire plans to accommodate the demand for new houses in two ways. The first is a new town of 10,000 homes just outside Cambridge at Northstowe, a former military airfield. The rest will come through extensions to Cambridge and the county's various market towns.

'Growth has been a very difficult public issue in Cambridgeshire because the city is surrounded by green belt which is a valuable local resource,' says Onslow. 'Extensive consultation led to a structure plan agreed by all parties, because I think people have realised that the economy of the area needs homes that are in easy reach of jobs. There have been people commuting long distances to Cambridge, which is not sustainable.'

As things stand the sub-region is to grow by 47,000 homes by 2016, and the county council feels that is the limit. Onslow says: 'If future plans for growth were to be above that we would be very concerned about it. The 40 per cent increase is a challenge we have taken up, but that is enough.'

Action to tackle both low and high demand was in hand before the Sustainable Communities Plan, so has Prescott's grand project really made much difference?

Chris Brown, chief executive of Igloo Regeneration, likens the plan to the apocryphal curate's egg.

'There are some positive things like the focus of attention on the Thames Gateway, although it will take a long time to get the urban development corporations up and running,' he says. 'But there are some negatives, like a lot of losers because the pathfinders mean that other areas in need are not getting funding.'

Despite this reservation, Brown supports the pathfinders' emphasis on wider issues than housing and has been 'very impressed by some of what is going on in, for example, Manchester and Stoke, where it is clear that unless regeneration includes the economy and community it almost does not matter what you do with the housing'.

He believes that the plan's emphasis on building in the South East growth area 'means that English Partnerships has taken its eye off the regeneration ball in other parts of the country, because they are led by government policy'.

Brown thinks the plan's premise that growth pressures in the South East must be accommodated is probably deliverable in the sense that land is available, but is mistaken in its conception.

'If you had a lot of machines and one was working at full capacity and the others were not, you would not think it sensible to do even more on the busy one,' he says. 'We need to pay more attention to the North and Midlands. There is absolutely no evidence that investment would go abroad rather than elsewhere in the UK if growth in the South East were limited. It is nonsense.'

It will take many years, extending long beyond Prescott's likely term of office, before the success or otherwise of the Sustainable Communities Plan can be judged.