In a better-ordered world, Kitson, or somebody like him, would be building homes to accommodate the extra workers who could easily find work there or in nearby Swindon, where joblessness at the last count was under 2%. But he is not, because, as he puts it pithily, "housing policy is regional policy". And we don't have much by way of the latter. Bits, yes, but as professor Brian Robson, a Manchester University geographer, says, we must not confuse policy for the regions, assemblies and all, with policies to address the disparity in development between regions and the housing anomalies which go along with that. Housing market renewal, Robson says, while effective enough within its limits, is part of a wider "incoherence".
Down the old coaching road from Devizes, in Andover, less than 1% of the official workforce is jobless. The figure is just over 1% in Basingstoke, and so on around the well-known "hot spots" in the South-east, such as Crawley and Guildford. But those are areas where housing supply is severely constrained by planning and prices. At no obvious point do the policies pursued by the Office of the Deputy Prime Minister and the Housing Corporation – let alone the Treasury or DTI – on housing growth, productivity and regional growth come together.
"There is a need to bring greater territoriality into policymaking." That was one of the conclusions of the Urban Summit last autumn, meaning greater recognition of inequalities between different parts of the country and the need to do something about them. Everyone connected with social housing can recite the mantra: oversupply in the North, deficiency in the South, connected inescapably with differences in job prospects and life chances. At some point, it is what the economists call a "zero-sum" game. For somebody to win, another area has to lose, or at least face some constraint. As Anne Power, professor of social policy at the London School of Economics, puts it: if the government pumps money into housing in the South-east, Birmingham will be the loser. Power is also the chair of the independent commission into Birmingham housing. She notes that while plans are afoot to expand Milton Keynes at a cost of about £40,000 a dwelling, a hundred miles up the motorway in the West Midlands there is more stock than applicants and money is desperately needed for renewals and repair.
Of course there are hot spots in the North, such as York, Windermere and Aberdeen, and cool spots on the south coast in dilapidated resorts like Hastings. But the overall picture is clear. Disparities between London and the South-east in terms of GDP per head have been widening. If England is indexed at 100, the North-east is worth 75% but London is worth nearly 130%. The average house in London costs £148,000 more than its eqivalent in the North-east – prices in Yorkshire and Humberside are 48% of the South-east's. Average house prices are eight times annual pay in the South-east, five times annual pay in Yorkshire.
Investment in the wrong places
All that is well known – but, to the increasingly vocal regional lobby, the killer fact is that the government is sustaining and even encouraging these disparities.
Take the proposals for the future of higher education, published this week after arduous discussions between the prime minister, education secretary Charles Clarke and chancellor Gordon Brown. Like housing, says professor Robson, higher education policy is closely bound up with the regions. He argues the government should back expansion in the North-west and North-east, at universities like Newcastle and Manchester, if necessary at the expense of Imperial or University Colleges in London or Oxford and Cambridge.
On a per-head basis, public spending on research and development does not unduly benefit the South-east, which actually gets £6 less than the North-east and only £5 more than the North-west. It is London where such spending is worth £208 a year against £167 in Yorkshire. That is within government's capacity to change, Professor Robson says. But change is not happening.
Transport is a factor too. Transport secretary Alastair Darling is thinking high-flying thoughts about airports, notes John Adams, regional specialist at left-wing think tank the Institute for Public Policy Research, "but I doubt he will be stopping the construction of a fifth terminal at Heathrow in order to expand capacity at Manchester."
New Labour, Adams goes on, has given the English regions development agencies, and elected assemblies are on the cards. But, Adams adds, there is little here of specific benefit to the less well-off areas. In addition, the North-east and North-west face a drastic decline in financial assistance from the European Union after 2006. Thanks to EU enlargement, the structural funds that now benefit the poorer areas of western Europe are bound to be re-apportioned.
To Richard Kitson in Devizes, and to his colleagues in South-eastern social housing, the absence of regional development policy delivers the worst of both worlds. As successive reports from the Joseph Rowntree Foundation have argued, governments are reluctant to pressure owners in growth areas into releasing land by liberalising the planning regime. That leaves a growing gap between households and places to live.
Neither is the government doing much to redirect growth to where land, housing and labour supplies are adequate. This is the thrust of the Council for the Protection of Rural England's criticism. To save the green fields of Wiltshire, CPRE policy director Neil Sinden talks of the need for "an overarching national planning framework", applied by the Treasury and the ODPM for the sake of "better balance". He cites the decision made a year ago to re-site a major government physics laboratory from Daresbury in Cheshire to Oxford, taking with it the potential spin-off in jobs and development.
But can governments push and pull growth in this age of globalisation? The national planning favoured by the CPRE looks to some like a version of socialism, which most of the organisation's affluent rural members might find somewhat incompatible with their own political beliefs. It certainly has no place in New Labour's thoughts.
One reason for the absence of active regional policy is the widespread belief that when it was tried before, it failed. Harold Wilson's Labour government strictly controlled London office development and began dispersing civil service jobs to sites in Newport, East Kilbride, Bootle and Newcastle. Even so, disparities were hardly dented.
During its sojourn in the political wilderness, Labour took on the conventional wisdom which says jobs are created "endogenously" by spin-offs from existing concerns and by local enterprise and innovation – not thanks to inward investment. "The challenge for government is not to deny this winners' circle but to expand it," according to official doctrine. New Labour abandoned "trying to identify regional winners or subsidise businesses that are failing". Its policy is supposedly about enterprise skills and scientific excellence.
But experts are sceptical. There are venture capital funds in place and special extra for some of the regional development agencies "but what they have not had the courage to do is set up alternative foci to the growth areas and countermagnets," says Professor Robson. "I am not sure the Treasury's position on regional development is robust," says John Adams of the IPPR with admirable diplomacy.
Yet recently there have been signs of a new interest in government action for the sake of "re-equilibration", notably from Ed Balls, the chancellor's top economic adviser. His apparent conversion may have something to do with the fact that his wife, Yvette Cooper, is MP for Pontefract, squarely in Yorkshire and Humberside, and that Balls is rumoured to be interested in becoming the Labour candidate for the adjoining seat of Normanton, which could do with some regional assistance.
So far, Balls and the chancellor have emphasised the ways in which the northern regions could help themselves; the rhetoric surrounding regional assemblies has identified them as a mechanism for self help in skills and local enterprise. But sooner or later the government will have to confront the Devizes question, which is the same as the London question and is about actively discouraging growth in these areas of housing stress. That may have been indicated last week when Gordon Brown said he would not put taxpayers' money into bringing the 2012 Olympics to London – though if London council taxpayers wanted their money spent on the project, that was a different story.
Professor Robson identifies the Thames Gateway as the supreme test of Labour's willingness to take regional development seriously. And he is pessimistic on whether the forthcoming Communities Plan from ODPM will make the picture any clearer. "Two lines of policy have been jostling uneasily in Whitehall of late," he says – renewal in the North on the one hand and accommodating growth in the South on the other. It is, he repeats, a zero-sum game: pulling investment into the East End of London does affect Liverpool's prospects, and growth into the South condemns the North to further decline.
Source
Housing Today
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