Radical regeneration reform needed

A new parliamentary report is calling for a radical overhaul of regeneration policy to tackle investment in deprived areas.

Research has shown that investment in run-down communities can be more profitable than investing in well-off areas, but preconceptions over crime and inadequate infrastructure put developers off investing.

The All Party Urban Development Group's report Business Matters, argues that these 'unsexy' areas have been overshadowed by the government's enterprise-led regeneration initiatives which the report concludes do not offer a quick-fix for tackling deprivation.

The report backs calls from the property and retail industries for property owners to contribute to Business Improvement Districts (BIDs) – an initiative that sees business owners pay a levy on top of their business rates to pay for amenities such as extra street cleaning, security and marketing, above and beyond what the council provides.

BIDs have, so far, been most successful at making good areas better, but in deprived areas BIDs are less successful because of occupiers' tight margins and the lack of provision in the existing BIDs financial structure for property owners to pay.

Business Matters argues that making property owners pay a BIDS levy would secure the long-term future for many regeneration schemes in deprived areas by guaranteeing funding. It would also address the issues which businesses are most concerned about that lie outside the remit of local government regeneration departments.

The report offers several wide-ranging recommendations, calling for:

the establishment of a property owner levy for Business Improvement Districts,

deprived areas to be recognised and prioritised in planning policy and,

recognition of the importance of providing public transport access to areas where jobs are concentrated.

Businesss Matters questions the commonly held view that one of the key causes of deprivation stems from a lack of jobs and finds that the relationship between business location and deprivation is not as straightforward as some might think.

The report argues that some deprived areas such as Brighton and Preston have above-average rates of business activity, and some deprived areas with low business activity do not necessarily need more businesses such as Lewisham which is close to areas with good employment opportunities.

The real problems lie with misconceptions and poor information about the opportunities and returns available in deprived areas, poor business environment and infrastructure, and the fragmentation of land ownership which makes it difficult for developers to "parcel up"; and the need for the public sector to shoulder some of the risk of investment and development in deprived areas.

Clive Betts MP, Chair of the All Party Urban Development Group, said: "Business Matters couldn't have come at a better time. With a new government committed to revitalising deprived areas, we have an excellent opportunity to review existing policy; examine what has worked and look at those areas that need to be improved. Our report sets out in very clear terms what the Government's priorities should be for streamlining and improving regeneration policy so that it is holistic and targeted."

Julie Grail Director ,Chief Executive & Co-founder of British BIDs, at the evidence session in Parliament on 20 March 2007 said: "Whilst we have an occupier levy in place, we will see BIDS coming in good areas, making them better, and the answer is to look at opportunities where we can have an owner levy in tandem with the occupier levy in a number of places."