At first glance the Budget, with the snappy regeneration-related title of ‘Building Britain’s Future’, seems to offer a lot of positives for the regeneration sector, with the Chancellor committing more money to jobs, green growth and housing. But all this is balanced by a greater demand for efficiency savings from local authorities and lower spending growth and, in the longer term, record levels of borrowing.
First the good news: £600million will be allocated to stimulate housing investment and to kick-start stalled housing developments or dormant sites with planning permission. £100million of this will be used to allow local authorities to ensure higher energy efficiency standards in social housing developments.
The Budget also saw the confirmation of Leeds and Manchester as pilot city-regions, which will give them greater powers to integrate planning, housing, transport, regeneration, employment and skills programmes and increasing their ability to drive sustainable growth and economic development.
Perhaps the most daring move is the £1.2billion that has been given to the Young Persons Guarantee Scheme, which aims to help alleviate the danger that the recession will lead to long-term unemployment by guaranteeing a job, training or work placement for all 18-24 year olds who are unemployed for 12 months. This is a staggering and unprecedented move which will see funding made available for local authorities and voluntary organisations to employ 100,000 young people in ‘socially useful activity’ with 50,000 more jobs on offer in areas of dense unemployment; 10% of these jobs are in the ‘green’ sector. More concrete details about this are eagerly awaited.
Meanwhile a further £260million will be made available for education and training including the expansion of the number of places at sixth-forms and colleges by 54,000 starting in September.
Also of interest is a £750 million Strategic Investment Fund to support advanced industrial projects of strategic importance, £250million of which is earmarked specifically for low carbon projects, helping to create sustainable jobs for the future.
The bad news is that, whilst the Chancellor believes that the economy will recover and begin growth at the end of this year and will grow by 3.5% by 2011, the IMF are more pessimistic, predicting that the UK economy will shrink by 4.1% this year and 0.4% in 2010.
Increased public borrowing, at a record level, combined with less growth in public sector spending and demands for increased cost-saving and efficiency will place further pressure on public sector finances. And whilst the investment to get the housing market moving again are welcome, they represent a drop in the ocean compared to the bail-out of the banks.
The problem, as ever, will be to ensure these initiatives meet the needs of people and places at the neighbourhood level. Renaisi is all about the neighbourhood but the danger is that the initiatives announced in the Budget will not benefit the neighbourhoods and the people that need it most. Take the measures to boost housing development for instance – care will need to be taken to ensure the funding does not simply allow private-sector house-builders to profit at the expense of creating affordable housing for local people. Similarly the Strategic Investment Fund for industry must be careful to ensure local people are connected to the jobs being created and have the opportunity to fully benefit from the investment.
Written by Russell Spencer, Renaisi Consultant
