Inner Cities

HL Deb 09 December 1981 vol 425 cc1355-61

3.47 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin)

My Lords, with the leave of the House, I should like to repeat a Statement being made in another place by my right honourable friend the Secretary of State for the Environment. The Statement reads as follows:

"The Government recognise that no single announcement can be the measure of the inner city and urban problem, but it is important to take those decisions we can as soon as practical.

"Next week my right honourable friend the Minister for Local Government and Environmental Services will chair a major conference for the European Campaign for Urban Renaissance, which will seek further ways of encouraging the voluntary sector in the inner cities.

"I have now to take important decisions about the allocation of my departmental resources to the urban areas and inner cities next year. Public expenditure is in many cases essential. But it is not, and of itself cannot be, the whole answer. As important is the need to open a range of opportunities for private involvement and investment. This will add significantly to the public resources in urban areas and will widen the choice in many fields for those living and investing there.

"The urban areas, and particularly the inner cities, have a concentration of unemployment and a deterioration of environment that argues for a particular stimulus for the construction industry and capital programmes.

"It is against this background that I have reached certain conclusions about the allocation of my departmental programmes for next year.

"First, the Government believe that the derelict land programme should play a bigger role in urban policy. Derelict land reclaimed at public expense can lead to development by the private sector that adds very substantial private expenditure to the basic public expenditure. At the moment very little reclaimed land is developed. Next year I intend to increase the derelict land programme from £40 million to £45 million.

"In allocating the uncommitted part of the programme I shall have particular regard to bids from local authorities, in conjunction with the construction industry, indicating the use to which the reclaimed land is to be put.

"I shall look especially favourably on those joint public/private sector schemes drawn from the land registers that offer the greatest private sector enhancement for every pound of public expenditure. I shall particularly look to schemes that lead to housing, industrial, commercial, sporting and recreational opportunities. I shall invite representatives of the local authorities and the construction industry to meet me next week to establish the procedures whereby I receive special bids for joint schemes by the end of January.

"Second, we will enable the two urban development corporations of London and Merseyside to undertake substantially more projects in 1982–83 than in the present year. I expect to authorise some £50 million worth of schemes compared with the £15 million they expect to spend on works this year. The House will realise that this, too, will attract much greater sums of private investment to enhance the effort that the public sector is making.

"Finally, Mr. Speaker, we have taken an important decision about resources for the urban programme in 1982–83.

"The local authorities in partnership and programme areas were asked to draw up programmes on a basis which would have implied a total of £215 million for the urban programme as a whole. I am glad to say that we have been able to improve substantially on this figure and will increase the total available by up to £55 million to some £270 million including a special provision of £5 million additional stimulus to low-cost home ownership.

"Mr. Speaker, my announcements today must be seen in the context of an urban problem that will demand our continuing attention. They do not represent a whole response, but they make an important contribution."

My Lords, that concludes the Statement.

Baroness Birk

My Lords, may I first thank the Minister for repeating the Statement made by his right honourable friend in another place. My first impression is that it is rather more a short paper for a seminar than a statement of the Government's strong intentions; more a catalogue of good intentions than of any urgent action. In fact, it is rather a pity that, on the second page, the word "urgent" was changed to "basic". Obviously, the word "urgent" was meant to come in somewhere, but it seems to have got lost.

I am delighted that the Minister for Local Government and Environmental Services will be chairing, a major conference for the European Campaign for Urban Renaissance which will seek further ways of encouraging the voluntary sector in the inner cities". With the greatest respect, I do not think that, in view of the critical condition in which we are and in which the inner cities are, this is going to play more than a very subsidiary part. Last year, the Secretary of State announced an increased allocation for the urban programme, but on examination it transpired that after deducting the specific allocation for the two urban development corporations the partnership authorities were in fact faring worse than they had done in the previous year.

Since, as I think I have indicated, there seems to be a certain fogginess about this Statement, I hope the Minister will bear with me if I put to him a number of specific questions. While, obviously, we are pleased that the Government have now decided to increase the amount they were thinking—and I should like the noble Lord to explain that phrase—of allocating for 1982–83, can he enlighten us further as to what this means? Using the same price base, will the partnership in fact do better than it did in 1981–82? Is he in fact using the same price base? If not, will he let us know what price base is being used? Will the Minister confirm that the inner areas will no longer be penalised by hold-backs on spending?—because, as I am sure he is aware, they are still being strangled by something in the region of £44.7 million of holdback penalties for overspending in areas where spending is essential. In fact, I hope that this catch-22 situation will come to an end.

What is the relevance, further, of the £215 million for the UDCs this year? Is this because the London Dockland UDC has only just been authorised and has really not had time to spend very much money at all? Is the £15 million that proportion of the £66 million, authorised by the Secretary of State in his Statement on 9th February of this year, that it has been possible to spend'?

As to derelict land expenditure, there is not a very great increase from £40 million to £45 million, considering the enormous amount of derelict land that exists. Not only is it economically unviable while it is not being put into use, but it affects the whole ambiance and the whole look and the whole quality of life of these areas when you see these great stretches of derelict land. I think that local authorities are going to feel very disappointed about that. Also, grant-aided derelict land expenditure still counts against local authority expenditure under the financial constraints, and I wonder whether the Minister can say anything further on that. Local authorities may indeed have problems, and many do, which they would like to resolve, but derelict land has to take its place in the list of priorities.

In the Statement, the Secretary of State refers to the fact that he will, look especially favourably on those joint public/private sector schemes drawn from the land registers that offer the greatest private sector enhancement for every pound of public expenditure". Local authorities are well aware of the land that they hold, in spite of the land registers, but there is little sign of private sector initiation in the current depression. I wonder whether the Minister can enlighten us as to what he expects to emerge between now and the end of January, which I think is the date mentioned in the Statement.

Finally, it seems to me—and I would hope that the Minister can prove to me that this is wrong—that the inner areas have in fact come off no better in real terms, and possibly even worse in real terms, than they did last year. With the experience of the riots, we know—we know even apart from that, but that, I think, has concentrated minds considerably on this problem—that a very large capital investment needs to be made, both in money and in a workforce, which really would give a lift to life in the inner areas and provide much-needed employment.

Lord Evans of Claughton

My Lords, from these Benches may I, too, thank the noble Lord the Minister for repeating this Statement. It is a Statement which one must obviously broadly welcome, in the same way as the people on Merseyside very much welcomed the presence of his right honourable friend the Secretary of State in Liverpool on an extended basis. I very much welcome the extension, small as it is, to the derelict land programme, and the involvement of the construction industry, which in many parts of the country is at present in desperate straits. Anything that can be done to create employment in that area must be welcomed. I wonder whether the noble Lord the Minister will try to ensure that youth groups, community councils and ethnic minority groups are involved as far as possible in any extension of the work that is brought about as a result of these initiatives.

Will the noble Lord the Minister accept that, like the noble Baroness, while I feel it would be churlish not to welcome the Statement, one's welcome is tinged slightly by one's concern that the increased expenditure referred to is more apparent than real in view of the clawback provisions that local authorities have been suffering. For instance, in the City of Liverpool alone the noble Lord's department has clawed back £20 million in the last year for alleged over-expenditure. Will the noble Lord the Minister confirm that in fact, so far as the partnership budget increase is concerned, the hard-pressed ratepayers will still have to find a quarter of that payment; and would he be able, perhaps, to reassure your Lordships' House that in months to come there will not be further reductions in capital expenditure? In the last five years the reductions in capital expenditure in the City of Liverpool alone have meant a loss of 11,000 jobs. So, while welcoming the Statement repeated by the noble Lord the Minister, one hopes that he can reassure us about the reservations I have mentioned.

4 p.m.

Lord Bellwin

My Lords, I must say that I was more pleased to hear what the noble Lord, Lord Evans, said in response to the Statement than what was said by the noble Baroness, Lady Birk. I do not know what one has to do to make a Statement which will please the noble Baroness. We cannot win them all. It is all right so long as we win some. She said it was more a catalogue of good intentions than of action. Those who will be receiving the extra £50 million I hope may feel that it was more action than a statement of intention. There is this additional money. I should have thought it would have been well received by everyone. I can tell the noble Baroness from my own experience—and I chair all the 15 programme authorities and four out of the six partnership authorities—that they will welcome the extra resources and will consider them more action than intention.

How the allocations will be made is yet to be decided. The noble Baroness referred to the inner areas being penalised by hold-back for overspending. I know that she will acknowledge that in the current year it was decided, in fact, that their contribution to the programme and the partnerships will not count in any calculation for hold-hack or clawback or any of the other names we use. She made a fair point when referring to the matter of the UDCs and some of the money underspent in the first year. I have not got the exact numbers. But clearly, it makes sense to move money around to where it can be used. There will be many programmes even at this time which will benefit from that switchround.

She said that the derelict land increase from £40 million to £45 million was not much and that some local authorities will be disappointed. In fact, the scheme as applied hitherto was such that the local authoritiy associations decided to include the derelict land within the total of the dispensation of the allocation under Block V. We are intending from now onwards to ex- clude it; so that the total money available for derelict land clearance will be able to be taken up in a way that was not always so in the past. The noble Baroness will welcome that. She said that in real terms the inner areas would be no better than they were last year. I cannot give the figures because the allocations have not been made, but it is not unreasonable to say that they will be better off than they were last year. I am satisfied they will be so.

On the final point, the land register, the noble Baroness probably does not know that the first 35 land registers showed over 22,000 acres of under-used land, half of that with development potential. About 400 acres of that has already been disposed of and some 4,000 acres are on the market currently and when we come to make all the authorities land register authorities, as it is now intended to do, it will throw up a great deal more land on to the market and will have the effects, hopefully, that we all want to see. Not least will be that of benefiting the authorities themselves, not only in their having work to carry out should it be their land—and it is not only local authority land that we are talking about but I am speaking of local authorities today—but they will also have capital which they can use to supplement capital receipts.

The noble Lord, Lord Evans, asked if the intention was to involve the ethnic community and other groups. I gladly confirm that that is so. In the Statement, I referred to sporting and recreational matters because we believe that is very important; and it goes on to leisure and so on. My answer is, Yes, very much so.

The noble Lord then asked whether I would assure him that there would be no further reductions in capital expenditure. He quoted Liverpool. I would remind him that capital expenditure by local government over many years has reduced quite dramatically and that has been one of the reasons why local government has been able to contain its overall spending within the parameters set by central Government of any colour—but at what a price. At the end of the day that price has been the lack of investment it was required to have. That is why we hope that, if we can get a reduction in current spending, which is the cause of so much of the trouble, we can get some beneficial capital expenditure within the parameters we are now setting down plus the scope that local authorities have to use capital receipts. There are some fascinating figures beginning to come forward to show the extent of the capital receipts local authorities are accumulating and which can be applied henceforth by them to do many things they want to do.

Baroness Birk

My Lords, one of the questions that I asked dealt with the price basis. It is important for us to know on what price basis the increase referred to in paragraph 3F has been made.

Lord Bellwin

My Lords, we are talking here of constant prices.

Lord Kennet

My Lords, I welcome the apparent drift of this Statement. It does not consist of a U-turn but I suppose if you climb to a great height and look down upon it you would be able to see some change, as with the curvature of the earth. I have one question about it. I think the noble Lord said that it was at constant prices so that inflation is not to be knocked off the increase. We have therefore an increase of 35 per cent. in next year's promised expenditure over last year's. I note from the Secretary of State's remarks that twice he spoke of the allocation, of my departmental resources and again of allocation, of my departmental programmes". This means that it is a departmental switch and not new money in the Treasury sense. Can the Government confirm or deny that? If it is a strictly intradepartmental switch, can the House be informed how much money has been cut off what other heads in order to make it possible?—because one should not praise increased expenditure without knowing what decreased expenditure has been incurred elsewhere.

Lord Bellwin

My Lords, as far as a U-turn goes, I do not think that is relevant to what we are talking about. One always seeks to use resources as best one can and, because we have decided we should make allocations in this way, I do not in any way consider that a U-turn—not that a U-turn necessarily has to be of itself something one should never do despite whatever happens. That is a personal view.

The noble Lord is partly right about where the money comes from. There is an element of additional expenditure and there is an element of moving expenditure around. I have not got the details here today. There is some movement from the new towns. As I said, there is an element of under-spending on the UDCs. It is another application of resources in line with the priorities. No one in this House is saying that the inner city areas should not have a priority. We are trying to do that.

Lord Ferrier

My Lords, while appreciating the extent to which by-passing of heavy traffic contributes to the improvement of city centres, can my noble friend say to what extent the Secretary of State for Scotland goes along with him in the proposals outlined in his Statement?

Lord Bellwin

My Lords, I understand that the Secretary of State for Scotland is fully in the picture as to what we are doing as detailed in this Statement; but this Statement applies to England and not to Scotland.

Lord Davies of Leek

My Lords, may I ask the noble Lord if any consideration is being given to city centres that may, not in the normal sense of a city, have to deal with mine subsidence as well as dereliction? This is a problem in cities and towns in South Wales and in Stoke on Trent, where mining subsidence, on top of the ordinary problems of a city centre, affects the area. I consider that places like that should have special attention.

Lord Bellwin

My Lords, the noble Lord is quite right to refer to what is a very great problem for some areas. I have been round many of them, not just in Wales but places like Walsall, parts of Manchester and so on. It is a very real problem. But we have to deal with those on their own as they arise and try to look specifically at ways to be helpful where we can be in dealing with what really are very big problems.

Baroness Jeger

My Lords, the noble Lord, in reply to my noble friend Lady Birk, referred to something called "constant prices". Can he explain to a simple housewife what is a constant price nowadays?

Lord Bellwin

My Lords, I suspect that the noble Baroness is slightly pulling my leg here in that she wants me to say that there is very little that is constant. If that is so, then I accept that leg pulling in very good grace.

Lord Underhill

My Lords, the Minister said in the course of an earlier reply that one of the problems is the large-scale cut-down in capital development by local authorities. He said that this could be dealt with if the authorities would deal with the decrease in their current expenditure. Can he tell me what the problem is likely to be if there are capital development schemes which leave the local authority—because it is cutting down current expenditure—in a position that it cannot run them or have the staff to look after them?

Lord Bellwin

My Lords, the noble Lord is talking of two separate matters. In my response to the point that he made, I was trying to make a generalisation because I felt that was how the original question was put to me on the whole area of current spending and capital spending. The figure I gave—I said some 65 per cent. reduction for capital spending in recent years—is absolutely relevant, too. The point of current expenditure is that that is about how many people you employ and what programmes you put forward on a day-to-day basis, whereas the capital programme is something that need not necessarily involve that. It does to some extent, but not in maintenance. With respect, the two matters are separate although they come together at the end in total spending.

Baroness White

My Lords, the noble Lord mentioned Scotland, but am I to take it that the Secretary of State for Wales will be making some different arrangements in the Principality?

Lord Bellwin

My Lords, I am sorry that I am not able to answer the noble Baroness as to that. I will get the information for her.