Last month's northern update to the Communities Plan – Making It Happen The Northern Way – iced the cake for the North-west. By announcing two growth corridors running from Liverpool to Hull and Sheffield to Newcastle, deputy prime minister John Prescott shifted the focus for the North from managing decline to pushing for growth. The exact remit of the growth corridors is not yet clear – a taskforce led by the three Northern regional development agencies will report back this spring with details – but the focus will be on using the big cities as economic drivers.
This means the North-west faces some tough choices. Not every town and city can have a booming economy or be named European Capital of Culture; parts of East Lancashire and Cumbria will inevitably have to accept a backstage role and councils, associations and housing market renewal pathfinders must work together.
The rocky corridor to success
Brendan Nevin, architect of the housing market renewal initiative and now director of the North Staffordshire pathfinder, is the man who came up with the idea of the growth corridors. Even he admits that the challenge is "going to be exceptionally difficult". He goes on: "We've got to get a level of coordination and make really difficult strategic decisions about the pathfinder areas and their functions in the new northern economy. There is huge potential for growth but also huge potential for conflict."
Nevin has identified two main axes of growth within the North-west corridors: from Preston through Warrington to Crewe, and from Liverpool to Manchester. "East Lancashire and Cumbria are totally outside that," says Nevin, "and I don't see how they can fight it. They can integrate into it but they can't stop it and we may have to redefine what some areas are there for – we could be looking at far more residential uses."
Elevate, the East Lancashire housing market renewal pathfinder, has accepted that several of its towns could function as dormitories for other parts of the sub-region and even for neighbouring Manchester and Salford (HT 28 November 2003, page 25) – so its thinking is broadly in tune with the wider regional agenda. Max Steinberg, chief executive of Elevate East Lancashire, says: "We are fully confident of the government's commitment to East Lancashire as part of a thriving North-west region. Our economy has long been linked to the larger economies of neighbouring urban areas and we believe it will continue to be so."
Cumbria has come up with its own ways to tackle low demand (see "A Tale of Two Counties", left) but there could be problems if it is left out in the cold after the comprehensive spending review in July.
Nevin believes there needs to be far greater formal coordination between the region's four pathfinders (see "Pathfinders to Enlightenment", right). He warns: "They had to put their prospectuses in separately and no one can be certain they're not in conflict."
Over the next two years, as the strategies are reviewed and refined, the pathfinders can expect to work more closely with each other and other bodies such as the North-west Development Agency.
It’s going to be difficult. We’ve got to get coordination and make really difficult decisions. There is huge potential for conflict
Brendan Nevin, North Staffordshire Pathfinder
Nevin is also oncerned that the three Northern regional development agencies are working up plans for the growth corridors (HT 6 February, page 8). "You need something much more sophisticated," he argues. "There has to be some serious and quick thinking – it could be a Cabinet committee that could follow things through at the highest level, like Misc 22 [the committee in charge of the Thames Gateway]." But a spokesman for One North East, the RDA that is leading the work, was quick to reassure doubters, saying: "The government has committed to this project at the very highest level and has appointed senior civil servants to work with the RDAs on this plan – and the RDAs have an impressive track record in working together."
It is essential that the partnership approach envisaged for the pathfinders filters down to registered social landlords in the market renewal areas. As swathes of housing are demolished, smaller housing associations could find themselves unable to go on unless they form partnerships or merge with larger landlords. "Hopefully, they won't have to fold," says one senior source at an RSL. "But they will have to accept new ways of working."
In Liverpool alone, 28,000 RSL-managed homes fall within the pathfinder boundaries. And housing associations within the Merseyside and Manchester-Salford pathfinders have already agreed plans to share out the work and consolidate their holds on various neighbourhoods (HT 27 June 2003, page 11). "We will definitely be seeing a lot more of this," says the RSL source. "Area offices will be the most affected and could end up closing."
RSLs could also find themselves hit with big bills when the pathfinders earmark stock for demolition. It's still not clear who will pick up the tab, but one model currently doing the rounds proposes that RSLs, councils and pathfinders each pay for one-third of the value of the homes that are knocked down. This doesn't work for Kim Penfold, director of strategy and information at Harvest Housing. "How are we going to pay off our loans if we're only keeping a proportion of the money from the compulsory purchase of the house?" he asks.
Then there is the thorny issue of grant recycling – when an association has been paid social housing grant to build a home, it has to pay the money back when the home is purchased. RSLs could be hit in the pocket twice, and behind the scenes some are beginning to mutter, though they are reluctant to express their doubts publicly. "There's a view in some housing association quarters that there should be changes to the recycled capital grant policy," admits a source at the Housing Corporation. "There are issues for the public purse on both sides of the argument and there is no clear-cut answer. The ODPM will have to take a view. We have suggested some sort of formal case is put together by several associations and then we'll see what we can do."
Councils in the North-west have an even bigger mountain to climb than do RSLs. Many are still struggling to meet basic targets such as the decent homes standard. Preston, Salford and Liverpool alone will need a dowry of at least £100m between them to be able to transfer stock and meet the target and hope the chancellor will help out in July's spending review (HT 20 February, page 11). In Manchester, where £18m is needed to fund a transfer on the Hattersley estate, the council is working hard to come up with a local solution. "We're looking at freeing up some of the land value to cross-subsidise," says Steve Rumbelow, director of housing.
Councils also have to cope with areas of low demand that have fallen off the national radar, paying for programmes of refurbishment and clearance out of their overstretched budgets. In Garston, Liverpool, there are 5000 homes outside the pathfinder that need to be demolished. Liverpool council is now carrying out area-by-area stock options appraisals.
The regional housing board also hopes the comprehensive spending review will provide cash to tackle low demand that falls outside the pathfinders. Rather than having yet more pathfinders, the board wants to administer any new money itself. "The preference in this region is for something a bit more flexible," one member says.
A tale of two counties
It would be easy to forget Cumbria when working out strategies for the North-west as the county doesn’t quite fit in with the rest of the region Areas of low demand to rival the back streets of Burnley sit cheek-by-jowl with some of the highest house prices in Britain. Yet despite its paradoxical problems, Cumbria has not received any special funding or status and falls outside the growth corridors proposed for the North. It has had to work out its own solutions, with the ODPM and the Housing Corporation watching closely. On the polarised county’s west coast, Allerdale, Copeland and Barrow have formed a market renewal partnership that aims to follow in the pathfinders’ footsteps with large-scale clearance and remodelling of the housing market. A member of the North-west regional housing board, who did not wish to be named, says: “West Cumbria has been working very hard to put together an action plan that could start with existing resources and then be used as a basis to lobby for more.” On the other side of the county, the popularity of the Lake District National Park has pushed prices sky high, and the sub-regional housing group is working on new models of affordable housing. For example, Eden Housing Association is running a pilot programme in which private sector employers provide land where homes for their employees can be built. “There are big challenges but we feel quite upbeat,” says Tony Bramley, managing director of Carlisle Housing Association and chair of the sub-regional housing group. “It would be fair to say that when we embarked on the North-west regional agenda we were concerned about being sidelined but our work over the past three years has seen us become an integral part of the region. We feel that we do have a voice at the table.”North-west: the stats
Cash for culture
Going up: the new housing hope
House prices in the North-west pathfinder areas have rocketed and the level of right-to-buy sales has overtaken the South-east for the first time (HT 20 February, page 9; 30 January, page 7). This could be bad news for the pathfinders, who will have to find more money to buy up homes for demolition, and councils, which will struggle to meet housing need as their stock dwindles. “It’s a complex picture,” says Brendan Nevin, director of the North Staffordshire pathfinder. “We suspect there’s a bit of speculation going on, which will push up the cost of clearance. We’ll be keeping a very close eye on it.” However, the price rises do also reflect a new-found confidence in the North that has seen investors, speculators and ordinary residents willing to invest in property that had once been considered worthless.Pathfinders to enlightenment
Who’s who
Director of the Government Office for the North-west, Barnes also chairs the regional housing board. A Mancunian, he was formerly chief executive of Thurrock council in Essex, where his most notable achievement was the creation of a unitary council in 1998. John Carleton
Previously unknown in the housing world but familiar to sport fans, this former England rugby player took over from Max Steinberg as director of investment for the Housing Corporation’s North region in August 2003. Max Steinberg
One of housing’s most colourful characters, the charismatic Steinberg left the Housing Corporation to take up a post as chief executive of Elevate East Lancashire. Known across the region as a “fixer”, his office is scattered with mementoes of his friends in high places. Flo Clucas
This Liberal Democrat councillor took over Liverpool’s housing service in December 2002. She has ambitious plans for the Capital of Culture 2008 and is determined to crack down on antisocial behaviour in the city. Eammon Boylan
Deputy chief executive at Manchester council, Boylan also led the development of the Manchester Salford pathfinder. Ian Perry
Chief executive of Manchester-based Harvest Housing Association, which has more than 14,000 homes. He also heads the consortium working on the country’s first housing PFI project, Plymouth Grove in Manchester. Tom Manion
Scouser Manion is chief executive of Salford-based Irwell Valley Housing Association. He’s best known as the architect of Gold Service, a tenant incentive scheme that has been taken on by other landlords across the country – but also for taking his RSL out of the Housing Corporation for two years because he felt the body was biased towards the South. Steve Broomhead
Chief executive of the North-west Development Agency. Formerly chief executive of Warrington council, Broomhead’s earlier jobs include principal of Warrington Collegiate Institute and principal of a Durham college.
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