The government has set up urban development corporations to tackle deprivation in Britain’s cities. If that sounds familiar, it’s because Labour has stolen the idea from its old archenemy – Tory grandee Michael Heseltine. And as we discover he’s far from pleased about it …
Michael Heseltine has occasionally been referred to as the father of the regeneration movement. Although still powerfully built, the 70-year-old has aged considerably in the six-and-a-half years since he was dumped out of political office. Perhaps he would be better described as the grandfather of regeneration.

Sitting in his office at Haymarket Publishing, Heseltine admits that he is unaware of several recent changes in regeneration policy, such as the proposed statutory enlargement of Urban Development Corporation boards from 13 members to 17. Rather, he enjoys recounting stories of the political battles he endured in the 1980s and early 1990s to lay the foundations of what he describes as the “revolution” in regeneration.

A quarter of a century since Heseltine entered Thatcher’s first cabinet in 1979 as secretary of state at the Department of the Environment, it is timely to reassess the impact of his regeneration work. That same year he drove through legislation setting up Urban Development Corporations in two key areas: London Docklands and Liverpool. Despite objections from cabinet colleagues, Heseltine felt that it was the only way to resuscitate two historic but dying areas, and his revolution was born.

Today the revolution’s influence lives on – the Labour government has decided to revive the UDCs to fulfil its own regeneration ambitions. But although Heseltine’s policies marked a turning point, can they be described a complete success? Indeed, rather than regarding Heseltine’s UDCs as a blueprint for the next generation of schemes, should policymakers be casting a critical eye over past projects to avoid repeating his mistakes?

Doing Docklands

In 1981 Heseltine set up the London Docklands Development focusing on a neglected area, 8.5 square miles in size, in east London. He bats away suggestions that pockets of Docklands remain deprived, despite the advances made by his UDC: “I haven’t made a detailed study of every last part of it. I do know that the process of unlocking the land of east London has been an extraordinary achievement and that it’s still happening on a very large scale.”

This response in unlikely to satisfy residents of areas such as Poplar. Despite the work of the London Docklands Development Corporation in the 1980s and 1990s, Poplar remains squalid, and envious about the shiny offices and the rich kids of neighbouring Canary Wharf. In 1991, Heseltine attended a £100,000 champagne party to celebrate the 10-year anniversary of the LDDC. Nearby, a less glamorous reception was staged, protesting at how a decade of grants had built new office blocks but failed to improve the lot of local people.

Heseltine is unrepentant: “That was the sort of thing one was up against. Whatever we did, all the changes we made were resisted by the left of politics. There was root-and-branch opposition to what we were doing, from the local authorities – all of which were Labour controlled – and from many of the organised tenants groups that were also of the left.”

The rival party was attended by Sister Christine Frost, the leader of tenants group South Poplar & Limehouse Action for Secure Housing (SPLASH). She is disdainful of Heseltine for allegedly dismissing these areas as “the last layer of dust” on east London.

Heseltine counters that while people like Frost may feel aggrieved, enough people did benefit to justify the LDDC: “What was the alternative? Well, one alternative was to let it fester, in which case, the largely publicly housed communities died, their children left, employers left. Anybody who had ambitions to move on in life left and that perpetuated, accelerated, accentuated the problems these areas had in the first place.”

Rather hopelessly and blankly, I said: ‘All right, we’ll leave out the other two sites.’ It was wrong

In a moment of candour, Heseltine admits that he did have it within his power to reinvigorate two other communities in the Docklands area, but declined to do so. The effects of that split-second decision can still be felt today. He took five parcels of land on the north bank of the Thames as the regeneration area, and was set to include Lewisham and Greenwich to the south. But he was persuaded otherwise, and the two areas still suffer from urban decay to this day – although the Millennium Dome development has boosted Greenwich to an extent, with 10,000 new homes earmarked for the site.

“I don’t come out of this story very well,” says Heseltine, sounding for the first time less fluent, “and it was the wrong decision, but it was such a battle to get this through. My department at official level was totally opposed to what I was doing. Somebody came to me one day and said: ‘Secretary of state, isn’t the north [side of the Thames] big enough? You’ve got 6000 acres.’ And

rather hopelessly and blankly, I said: ‘All right, we’ll leave out the other two sites.’ It was wrong.”

A boost to Liverpool

Heseltine’s other vision in the early 1980s was the regeneration of Liverpool. He could not believe that the dereliction in Merseyside docks could exist just a stone’s throw away from a major city centre. In his mind regeneration was the only way to stimulate the economy, and so he set up the Merseyside Development Corporation.

Today, the city outwardly is doing well, with a recent Office for National Statistics survey showing its economy has outgrown those of Leeds and Birmingham. But the the Liverpool UDC did not address some underlying problems. In fact, in 1993 the situation was bad enough for the European Union to step in and make Liverpool the first city in mainland Britain to receive Objective 1 regeneration funding.

In a strange twist of logic, Heseltine argues that the Objective 1 funding was a sign of the UDC’s success: “That indicated there was a new sense of confidence, a generation of people who had leadership capacity and opportunity, and were fighting back by getting that status. Liverpool was on its way by the early 1990s, the turnaround started in the very early 1980s,” he says.

Heseltine also claims success for his Garden Festival scheme, which attracted 3 million visitors in 1984. Borrowing an idea from the Continent, Heseltine’s plan was to hold a festival on 600 acres of polluted land on the banks of the Mersey. Following large-scale decontamination and a festival encouraging civic pride, the area would be regenerated, with housing and industry attracted to the area. Two decades after the festival, the site still lies derelict – several schemes having fallen through, due to planning problems or poor business cases. The area has been nominated by CABE in a contest to find the UK’s most wasted spaces.

While it would seem that Liverpool’s UDC failed to come up with an after-use for the site, Heseltine defends the scheme. He claims that the event was so successful that nobody wanted to replace the Garden Festival: “The initial hostility towards the Garden Festival gave way to such a feeling of pride and affection for it and what it stood for, that there was no will to go ahead with the second stage, which was its development.”

The government has copied, in the urban development and regeneration field, what they previously resisted so bitterly

The return of UDCs

Heseltine sounds bitter when he argues the Labour government simply stole his ideas for regeneration and claimed them as its own: “The government has copied, in the urban development and regeneration field, what they previously resisted so bitterly. Practically every scheme we introduced they resisted, changed the name and got on with it,” he says. Repeating himself, Heseltine begins to sound like a child who has had his toys confiscated: “Of course, they would argue that it is different, because they had to rename them in order to give the impression they were their ideas; but they were all

my ideas.”

The government has reintroduced UDCs as part of its drive to regenerate the Thames Gateway to the east of London – the largest brownfield site in Europe. It is, indeed, a notion that Labour previously rejected. But deputy prime minister John Prescott has modified the idea to avoid the problems associated with the Heseltine version.

Heseltine’s UDCs were accused of creating a democratic deficit, as they not only took planning powers away from local councils but also limited the councils’ representation on the UDC boards. This angered community leaders and led to many to protest against the UDCs. The Prescott version will see expanded boards, with greater local

authority representation. These UDCs will refer many of the planning decisions back to the councils. It is hoped that the creation of a broader partnership will prevent confrontation.

Heseltine denies there was such a deficit, as councils had some representation on the boards, yet he freely admits his major aim was to sideline what he saw as socialist local authorities in east London. “I had no worries at all [about a democratic deficit], because I’d seen what those political regimes had done, which was to create some of the greatest areas of desperation in a capital anywhere in the world,” he says.

The man once dubbed “Tarzan” may have aged, but he is still as aggressive as ever, and eagerly seizes the opportunity to make a dig at his successor. Asked if he has any advice for Prescott to help him convince Tony Blair to put regeneration at the heart of government policy – as Heseltine succeeded in doing with Thatcher – his eyes gleam.

“I’m not sure how John Prescott could persuade Tony Blair, and I’d be rather frightened if he could, because his views would take us back to the dark ages,” he


The granddaddy of regeneration

  • 1979 Enters the first Thatcher cabinet as secretary of state for the Department of the Environment. Takes the concept of Urban Development Corporations for east London and Liverpool to the prime minister.

  • 1981 London Docklands Development Corporation set up under Nigel Broackes, the then-chairman of contractor Trafalgar House, Liverpool UDC set up under Leslie Young, the then-chairman of J Bibby and Sons.

  • 1984 Heseltine opens a Garden Festival in Liverpool, used to clean up some of the worst of Merseyside’s waterfront wasteland.

  • 1990 Returns to the Department of the Environment in John Major’s government.

  • 1991 Proposes that 575,000 homes be built in the area today known as the Thames Gateway. Two years later his successor, Michael Howard, scales down the plan to 182,000. Heseltine says that “Michael slightly slowed” the development of the area.

  • July 1991 Heseltine launches the City Challenge Fund, asking deprived urban areas to make competitive bids for central government money. Eleven winners were announced, including a project to regenerate the notorious Hulme Estate in Manchester under Amec chairman Sir Alan Cockshaw.

  • 1993 Now President of the Board of Trade, Heseltine and environment secretary John Gummer launch development agency English Partnerships.

Merseybeat: Heseltine’s Liverpool vision

In 1981, the Merseyside Development Corporation became Britain’s first urban development corporation. It was concentrated on the docklands area, 85% of which was derelict. Liverpool was a city in decay: between 1971 and 1981, 31 of the city’s 33 wards showed a net population loss.

Three years later it became the location of the National Garden Festival, an event that cleaned up much of the land’s toxic land and attracted 3 million visitors. However, the hoped for mass development that the festival was supposed to generate never transpired: 750 homes were built in the area as a result.

In 1998 the Financial Times wrote: “While the festival was only a five-year project, it was believed that it could provide a permanent monument to urban regeneration. But today the site is run down, with rusting fences and overgrown with weeds.” And unemployment was double the national average.

The MDC existed until March 1998. Among its achievements were the creation of 19,000 jobs and the attraction of £660m of private and public sector investment. Despite being one of the UK’s most prominent cities, however, it still has a per capita income below the national average.

East-end boy: What Heseltine did in Docklands

Set up in 1981 under the Local Government, Planning and Land Act of the previous year, the London Docklands Development Corporation spanned 8.5 square miles in east London, on the north bank of the Thames. This area was largely derelict, and between 1978 and 1983 more than 12,000 jobs were lost.

The board, which was made up of council representatives and private sector figures, took over planning powers from local boroughs and had the resources to build new infrastructure. It had compulsory purchase powers to bring derelict land back in to use.

In the 17 years it ran, between 1981 and 1998 the LDDC attracted £1.86bn in public sector investment and £7.7bn in private sector money. Much of the latter was a result of the Canary Wharf development, an alternative location to the City for major banks, lawyers and other commercial operations.

However, the areas surrounding the LDDC remain areas of high unemployment and low wealth. Some argue that poorer communities within the old LDDC area have simply been displaced by more affluent people. The LDDC website admits: “Opinions varied about how well the corporation succeeded in its regeneration task.”