Tuesday, 12 July 2011

Speech on HMR in Parliament - unabridged version

Thank you Mr Gale, it’s a pleasure to serve under your chairmanship.

I'd like to congratulate the member for Liverpool Wavertree for securing this debate on what is a most important of debates to my constituents : the axing of HMR. HMR overall was a successful scheme though there were problems which I will come on to address.
Much shortened version delivered - video 
I want to address how the ending of this scheme affects my constituency Mr Gale. How it affects low demand areas? And some of the false statements put out by the minister and finally the issue around the governments £30m offer.

Where we are now.

Let’s be clear where we are now. We are facing a human misery. People were given assurances that the HMR red line around their neighbourhood would be a 15 year programme

Not one which would first of all encourage de-investment and then at the bottom of the regeneration trough be pulled, leaving streets abandoned in the worst cases looking like ghettos.


Charlie Briggs – no deficit denier

Criticism abounds of the governments ill considered decisions to axe HMR, even from the Governments own side the minster is taking flak .

Liberal Democrat leader of Burnley Council summed up the problem of oversupply and the government's decision when in an LGA article he wrote stating
The high proportion of older ‘back of street’ terraced housing, often in poor condition, has skewed the housing market. The HMR programme was established to tackle this problem. A return to economic growth for places like Burnley needs economic development activity to be supported by a better balanced housing market.
I am no deficit denier: a significantly reduced programme I could understand. Capital has been cut by about 70%, so I could understand a cut of HMR of this order. But to sweep it away is unacceptable.
Government claims this was just a Labour programme?

This type of regeneration once had cross party support. The minister himself was once a fan as was the Prime Minster who made unequivocal promises.

Back in 2006 the Prime Minister took the whole cabinet to visit to Liverpool. Whilst walking along a street of terraced houses he observed that
“Run down areas become a magnet for dumping and littering.”
And laid out his political ambition saying of regeneration that (and I quote)
“It's a huge task. I want the Conservative party to be the party of urban regeneration.”

“The aim is to make our cities better places for people to live in”
And in August 2008 the Prime Minster embarking on a tour of nine marginal seats in the north-west said;
 "I think there is a resurgence going on in Britain's northern cities. Conservative party policy will continue the good work of regenerating cities right across England, including northern cities." David Cameron 13 August 2008 Guardian
It is right that People feel badly let down. That the government and the Prime Minsiter have broken their promises.

Peter Latchford, former Chair of the Birmingham and Sandwell Pathfinder (Urban Living) said:
‘I am particularly concerned at the message sent to people living in complex and deprived areas when a programme like this is terminated so abruptly. In Birmingham and Sandwell, we showed that the best results come from involving local people; from investing in long term relationships of trust; from holding ourselves properly to account locally. There is no better way to disillusion such people, who have seen a succession of “interventions” come and go, than to pull the plug half way through the promised period.’
HMR was successful

HMR scheme made good progress in some of the most deprived areas according to the Audit Commission, Shelter and the Chairs of the former Pathfinder areas.

According to Shelter, the Housing and Homelessness Charity:
“The Housing Market Renewal pathfinders have brought much needed investment to parts of the North and Midlands experiencing low demand for housing and long term economic decline.”
The Audit Commission published a report on HMR in March this year.
The report’s findings showed
"that the decision to abolish the Housing Market Renewal programme was ill advised."
Audit Commission findings in brief

I want to remind the Minister of the report’s key findings:

£2.2bn invested in Housing Market Renewal (HMR) programme since 2002 with on average around £115 being spent per resident per year.

In Newcastle Gateshead £60 million of HMR funds, together with council and HCA contributions, is set to secure £400 million private investment and deliver more than 4,000 new homes.

The report estimates that by March 2011 the HMR programme will have:

• generated some £5.8 billion of economic activity across the economy
• created some 19,000 jobs in construction and related industries; and
• Helped maintain over 2,600 jobs in the construction industry each year.

Report also highlights that by its closure the scheme will have:

• refurbished more than 108,000 existing homes
• attracted private investment to complete over 15,000 new homes
• Readied substantial sites for future development through selective acquisition and clearance of up to 30,000 properties.

Audit Commission Summary

I want to put the brief Report Summary on record here Mr Gale.

Audit Commission
“The HMR programme is making a difference to the communities it serves, with fewer empty houses, reduced crime, and more jobs and training opportunities, especially in those neighbourhoods that are more advanced in their programmes.”
It goes on to recognise that the Governments current proposals for £30m which essentially ‘evacuate residents’ which only seeks to remove the personal misery from broadcast and news media to assist the government politically.

The reality though is pointed out in the Audit Commission's final summary
“the emphasis must be on completing current key interventions; not least to ensure that promises made to communities are met and to reduce the risk of previous investments being undermined by leaving a legacy of uncompleted projects. At this stage there is a significant risk that neighbourhood regeneration projects stall, leaving communities living in a poor quality environment indefinitely.“
Why – two different reasons for ending HMR?

Since the CSR the minister has oscillated his argument between two separate and contradictory argument budget reductions and waste of money.

The Housing Minister told the House of Commons on the 10th June last year that
Grant Shapps “I have visited many of the housing market renewal areas, and we are passionate about ensuring that they can go ahead”
And on the 10th of October last years that
Grant Shapps: “ I have visited pathfinder schemes on many occasions, and some were very good and some had some problems. We will complete all the committed HMR schemes, “
I’d like ask minister How many of the Pathfinder areas did the Housing Minister actually visit before making decision to terminate scheme?

Why did he promise to complete all committed HMR schemes when he has no intention of doing so. I can say that with certainty in my constituency Hyndburn?

Will the minister clear up this train of miss information?

The Government has no exit strategy and blames waste for cancellation of the scheme?

The sudden withdrawal of funding has meant that Local Authorities have been unable to complete projects that were already underway.

The Government should have considered a phased withdrawal from the programme and the basis for managing the scheme should have been based not on the five reasons the Housing Minster has used so frequently and I want to dismiss all of them.

1. Deficit reduction which ignores the plight of these areas, the promises made, the economic arguments to continue and the investments made so far.
2. Future funding which I will come on to address, RGF, NHB and £30m transition fund.
3. Waste.
4. Top down targets
5. Conflating Oversupply & Undersupply

Political Control and Waste

There has been waste in HMR areas but I want to remind the minister that of the 5 areas he is providing additional funding, Hull, Liverpool and Stoke were Liberal democrat controlled, East Lancashire Liberal and Conservative controlled and Tees Valley no overall control.

In East Lancashire Hyndburn’s Conservative Council was handing out full market value payments, relocation grants and plus a cash hand out of £30,000 on top. It was undertaking group repair at £55,000 per property when the full value was barely that. Significantly too it never engaged with estate agents or architects on added value and redesigning of properties.

I am told in Liberal Democrat Pendle £1m was spent converting 8 houses in to 4, a figure that does not include acquisition.

One of the issues Mr Gale was the lack of Government intervention on Lib Dem and Tory Councils.

Top Down targets

Path finders were as the name implies, a housing programme where local authorities were told to ‘find a path’, there were no top down targets as the minister said he in reply to the Hon Member for Birkenhead on 20 Jan when he said

Some pathfinder schemes were successful; however, others attracted controversy due to an over-reliance on demolition, in part encouraged by top-down government targets.

An assertion he has made repeatedly

I’d like to ask the minister if he can name a single top down target imposed under the HMR programme?

I cannot and neither can anyone else including the minister because he has failed to provide a single meaningful example so far.

Waste and neglect has led to problems.

The demolition programme which the minster is keen to highlight as the major problem across HMR and which was the bulk of the programme cost was fine in my opinion excepting practices by my local Conservative Council.

But why was the Minister was politically silent or complementary on HMR in the run up to last years local elections – has resulted in schemes which could have gone further.

Hyndburn HMR unfunded including areas that fir tough new trasition fund criteria

Woodnook and Peel in Accrington unfunded.

I want to assert to the minister the scale of the problem.

The residents in the area were consulted in 2005 plans drawn up and presented with a level of detail that included houses to be demolished, trees to be planted.

The Conservative Council scrapped them as they went on a spend, spend, spend overdrive in West Accrington.

In 2010 they repeated the process covering some 90 terraced blocks with 15 houses per block on average. The member for Rossendale and Darwen was courteous enough to visit last month and recognised the true scale of the problem.

Of these 90 blocks in the red line areas who believed their area would be regenerated the Council following the CSR cuts and axing of HMR has scaled back the plans to just 5 blocks.

In many of the other blocks occupancy rates are between 30% and 80%.
In the DCLG press release on 9 March this year the Minister stated that
“This coalition government is committed to helping vulnerable people and will not stand by when residents are stranded in derelict neighbourhoods though no fault of their own”
Conflating Oversupply and Undersupply


The minister trots out as one of his reasons that there is a shortage of housing in the UK.
The housing market renewal programme was responsible for demolishing a large number of homes-so many that there are fewer affordable homes after the 13 years of the previous Government than there were when they got into power in 1997. (Citation: HC Deb, 17 January 2011, c535)
And
but the pathfinder schemes-the housing market renewal that destroyed homes and neighbourhoods. It was partly responsible for our ending up with fewer homes than we started with after 17 years.
Hansard source (Citation: HC Deb, 25 January 2011, c49WH)
Can I suggest that conflating the South east and the North West is imaginary and very unhelpful as it belittles the truth. There are more houses than people in significant parts of the North.

Is the minister not aware that Liverpool had a population of 1million and now it is nearer 450,000. That East Lancashire has seen a fall in population.

Is he that lost from his brief that he is not aware that there are 750,000 empty properties and most of these are in the North? Homes people do not want, the Private sector does not want, that hard pressed Councils may want but have no money.

Is he really suggesting to cure low demand that people from the South East move to the North and if so is this official government policy and what is he doing about it.

If not then I suggest he refrains from suggesting there are more people than houses for it embarrasses his current own position.

Additional funding is grossly insufficient

Additional funding is grossly insufficient. East Lancashire alone needs way in excess in £20m to complete current liabilities. The previous Conservative Council had committed to a further £2.4m of unfunded CPO commitments in West Accrington which will swallow up any new resources.

In East Accrington there is barely any left to expand the scheme even though several blocks qualify for tier 2 funding of less than 50% occupancy.

We have 90 blocks where promises exist. Where two plans and two maps have been distributed to the public. We are doing 5 blocks.

This new money means we may be able to do two more.

I can think of at least another 4 blocks with less than 50% occupancy but we are a small district council facing formula grant reductions from £11m to £6m.

Is the minister aware of this and what is he doing to ensure Lancashire County Council which consumes 72% of Council tax is contributing?

Anything for funding

Such is the desperation of the District Council to do something - they are prepared to say whatever it takes to the government to get any crumbs that may help these people.

The reality is they know they are abandoning residents because they are simply shorn of government funding and the private sector does not want to know.

They know the minister has placed a transfer of ownership of the problem to the District Councils and they are being forced to accept that and I stress these words – knowing full well they are leaving streets with low occupancy, less than 50% that do meet government criteria and neighbouring streets that are degenerating and little can be done.-

I would urge the minster to follow his colleague, and keep a personal promise to me to visit Woodnook. Since that promise I would like to go on record and say the minster has been silent on that promise.

The Council has no money following the outgoing Conservative Council are even saying that the new Council should not be spending another penny on HMR and not bidding to the Government.

The Prime Minster’s comments about his party ring hollow as we stand here today, both locally and nationally.

5 excluded Pathfinders


The additional funding of £30m for the 5 worst affected areas is grossly insufficient to meet the needs of these areas. Furthermore, the remaining HMR areas will receive no funding whatsoever.

Abigail Davies, assistant director of policy and practice at the Chartered Institute of Housing, said:
'The problem that Grant Shapp's has identified is a real one and £30m will be useful to help individuals who are still living in these areas waiting for regeneration. But this is not enough to replace the millions of pounds that was cut from the Housing Market Renewal programme in the comprehensive spending review. Areas with large scale economic problems need government intervention alongside local participation.'
John McGuire, former Chair of Oldham and Rochdale Pathfinder (Partners in Action), remarked upon the ‘unfairness of the proposed additional funding’ and the ‘failed promises to local residents on a grand scale’. He added that ‘boarded up housing [continues] to blight these areas’.

Mike Gahagan, former Chair of Transform South Yorkshire Pathfinder, said:
‘the sudden termination in HMR funding has left many families in distressed surroundings’.
An issue I have not touched on but the selection of the 5 areas seems discriminatory -

On what assessment was the decision to select these 5 areas made?

The areas not receiving additional funding still require assistance. What is he doing to address this?

Lack of clarity/misleading - 

Regional Growth Fund

Residents in these areas believe not only have they been let down by the Prime Minister and this government, but that they have cruelly and deliberately misled.
The Minster has repeatedly told the House of Commons, local authorities and residents that HMR would be replaced by the New Homes Bonus and the Regional Growth fund.

In a circular within DCLG Shapps wrote, on 20th October 2010, at the time of the CSR: 
“ To support growth we will give Local Authorities the freedom to borrow against tax revenues and will also provide access to a Regional Growth Fund to fund capital projects which could support housing growth and market renewal schemes.”
And in a reponse to myself on 11 Nov last year Mr Gale the minister said
Grant Shapps: We will complete all the committed HMR schemes, and we will then roll the funding up into the regional development fund to continue the good work. [27th October 2010, Vol 517, c.5mc]
And to the honourable member for Burnley in June last year he stated
"Those areas covered by recently announced local enterprise partnerships will be able to bid for funding from the regional growth fund for capital projects. The Government will continue to work with local authorities to enable the delivery of housing and regeneration which have the support of the local community."
The Minister in the Lords (Baroness Hanham) also stated :
it will be for local authorities to decide whether to continue with their housing market renewal partnerships and to bid for funding which would allow them to take forward market renewal projects in their areas. This could include the £1.4 billion regional growth fund ....... as well as new incentive schemes such as the £1 billion new homes bonus. [HL4956]
However, appearing before the CLG Select Committee in the Commons on Monday (27th June) Lord Heseltine, Chair of the Independent Approval Panel for the Regional Growth fund contradicted that setting out the governments position on RGF:
“The regional growth fund is not in any way a replacement for the housing market renewal funding…. There is no way in which we are doing housing renewal… housing is not high on our list because it does not create long term jobs.
The minister has clearly given false hope and I hope he has the contrition to accept his misleading comments to parliament and the public and to apologise to those he and his government has misled.

I am sure the words .
“We will complete all the committed HMR schemes, and we will then roll the funding up into the regional development fund to continue the good work.” will haunt the minister.
New Homes Bonus

But it is not jsut the Regional Growth Fund where the minster has misled the public.

I intercepted a Conservative leaflet to be distributed to the people of Woodnook last autumn which said the New Homes Bonus would be used to replace HMR for the 90 blocks of some 1300 homes in the current phase that are now not to receive HMR following the axing of HMR funding.

The minister has repeatedly confirmed that the New Homes Bonus will supplant HMR.

Yet figures distributed by the House of Commons Library show that my constituency Hyndburn received just £62,000. Is the minister aware that the average prices for acquisition in West Accrington is £77,000 and in east Accrington £45,000.

Is he now not embarrassed by his comments that NHB will assist HMR areas when we find out that the New Homes Bonus will allow the local authority to just buy one house. And the minster says we can roll up this up over 6 years. That’s 25 houses by 2016 or one of the longer blocks out of the 90 promised.

East Lancashire has some of the worst housing the country and yet the 5 HMR LA’s are recipients of the lowest new Homes Bonus payments in the UK. All 5 feature in bottom 27 out of 350 authorities and receive less that 90p per head.

Ranked from the bottom - LA by NHB payment
10 Ribble Valley - £62k
12 Hyndburn - £62k – 78 pence per head
16 Burnley - £70k
25 Pendle - £101
26 Rossendale - £102k
27 Blackburn - £110k

Compare Hyndburn’s 78p per head of population NHB payment with that of leafy Conservative Uttlesford who receive £9.30 per head or leafy Conservative Tewkesbury £6.47 per head.

How is that fair?

How is that consistent with the ministers extravagant claims?

And with more properties than people it is no good the minister saying we will be rewarded for filling empty homes.

How?

Is he making the ridiculous argument that people should leave delightful Tewkesbury and Uttlesford where they want to live and where there is high demand and move to Woodnook where there is little or demand?
Charlie Briggs Lib Dem Ledwer Burnley: The new homes bonus is the foundation of government housing policy. However, I doubt this policy will be as effective at incentivising housing growth in areas that can easily generate new homes but suffer from acute nimbyism. It does not work for us, either – a place that wants housing growth but needs to build the market before the private sector can take the strain.
Most organisations have made the same point and it is about time the minster faced up to facts
Only 10% of RICS members responding to their consultation felt the NHB would be successful in increasing the number of new homes in the market. 40% of respondents believed it would have no effect at all and 50% a negative effect or don't know.

Why with a declining population would we Hyndburn Council want to build more houses and create further over supply. This in an argument based on madness.
People in East Lancashire and other HMR areas have been misled. There is no RGF and there is no NHB. This is a minister on the run evading, a government that is accepting of misery and a misfortune.

Crime Hotspots and Human Misery

Families remain trapped in deserted streets where projects have been abandoned. These areas attract crime with several having experienced arson attacks making it very dangerous for those still living there.

Stuart Whyte, former Chair of Gateway, Hull and East Riding of Yorkshire Pathfinder said:
‘Residents have been left amidst rows of empty and boarded up properties – often the only remaining resident in a terrace.’
‘The areas have increasingly become a magnet for crime and anti-social behaviour. These residents are already very vulnerable; living in these areas for an extended period is likely to have a major impact on their health and well-being.’

Loss of funding also has ‘the potential to spread blight and undermine the value of all the regeneration and investment to date.’

‘Beyond this human misery the sudden withdrawal of funding has a major impact on the willingness of the private sector to invest in the areas.’
Mike Gahagan, former Chair of Transform South Yorkshire Pathfinder, said:
‘the sudden termination in HMR funding has left many families in distressed surroundings’.
He added:
‘I cannot see why the award is limited only to the five Pathfinders…you cannot simply draw a line under five and say that the remainder do not have a problem or that Government's responsibility is somehow less to the families in the other areas…even the tenth rated Pathfinder will be one of the most deprived areas in the country.’
‘Personally, I would not have a problem with the most needy areas taking a higher percentage of the £30m. I cannot, however, see the logic in arguing that some should receive nothing.’

If for no other reason we have a human obligation to our fellow citizens to complete these schemes.

Summary

Mr Gale I want to sum up by saying the government have an obligation and forcing local councils to accept liability is not going to make the problem go away, particularly for lower tier District Councils.

In surmising I thought Charlie Briggs was accurate in his assessment;
Cllr Charlie Briggs Lib Dem leader of Burnley Council: £30 million remains insufficient to meet the areas needs we need a policy and funding that gives us a bridge to Mr Shapps’ new world.

We are in touching distance of a revitalised housing market. It will be disgraceful if the government now pulls the rug on us and, more importantly, our communities.
The government is nowhere on regeneration.

Its own document on regeneration - ‘Regeneration to Enable Growth’ is just an embarrassing 3 pages long followed by cut and paste tables.

Is that the Governments position on regen, 3 pages?

When David Cameron visited Liverpool he put Lord Heseltime in charge of regeneration stating.
“I am delighted to be here and announce the setting up of a Cities Task Force which Heseltine has agreed to chair. He has a great record in helping with urban regeneration and is a great friend of Liverpool's.”
Questioned at last weeks DCLG Select Committee he had this to say on Regeneration
“There is a white paper about it all. It is “Going for Growth” or something”
It is clear the Government have abandoned regeneration and abandoned HMR. When those the Prime Minister has place responsible in know so little you know this Government doesn’t care enough to want to resolve the real problems.

Perhaps the minister has recognised that he has conveyed confusion and miss information and has eventually come back around the nub of the issue that this problem is not going to go away

I note in closing that the minster last Tuesday announced his department is working on a new regeneration fund.

I would urge to mindful and note the failures of the New Homes Bonus and Regional Growth Fund with regard to low demand HMR areas and that he avoids misleading the public further.

It would be helpful Mr Gale if the minister could clarify his answer to the DCLG on HMR in which he says he has a scheme in mind where local communities can access further sums of local money through a local process which will enable regeneration

It is important the minster tells embattles communities how much this is?

Will it be in existing HMR areas?

Will it be part of a strategic or public/private business plan?

Crucially in my constituency, will it be more than the embarrassing £62,000 the minister has provided in the NHB fiasco.

And I close my remarks there Mr Gale.