UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 47 - i

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

OFFICE OF THE DEPUTY PRIME MINISTER: HOUSING, PLANNING, LOCAL GOVERNMENT AND THE REGIONS COMMITTEE

(URBAN AFFAIRS SUB-COMMITTEE)

Monday 26 January 2004

MR CHRIS OLDERSHAW, MR MIKE BURCHNALL, MS FRAN TOMS and MR PETER BABB

MR MARTIN BACON, MR EDDIE BOOTH and MR DAVE CHETWYN

MR TOM BLOXHAM, MR NIGEL HUGHES and MS SYLVIE PIERCE

Evidence heard in Public Questions 1 - 97

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Committee (Urban Affairs Sub-Committee)

on Monday 26 January 2004

Members present

Chris Mole, in the Chair

Mr Clive Betts

Mr David Clelland

Mr John Cummings

Christine Russell

________________

Witnesses: Mr Chris Oldershaw, formerly Project Director, The Grainger Town Partnership, Newcastle, now Executive Director of the TyneWear Partnership, Mr Mike Burchnall, Divisional Manager Planning and Public Protection, Regeneration Directorate, Liverpool City Council, Ms Fran Toms, Head of Cultural Strategy, and Mr Peter Babb, Head of Planning, Manchester City Council, examined.

Chairman: Good Afternoon and welcome to this first session of the Sub-Committee's inquiry into the role of historic buildings in urban regeneration. We have had an opportunity to look at the written evidence you have submitted. Do you feel the need to make any preliminary statements or would you be happy to go straight to questions? We can go straight to questions.

Q1 Christine Russell: This is a very easy question to all of your. All your cities, Newcastle, Liverpool and Manchester, suffered quite badly from industrial decline but I think all of them, over the last few years, have managed to achieve really successful regeneration schemes. Therefore the question is: what role have historic buildings played in those successful regeneration schemes in your three cities?

Mr Oldershaw: I think in many ways heritage and historic buildings have a crucial role to play in regeneration. They help to define the identity of cities and they also, certainly for Grainger Town, give economic and competitive advantages as well. Back in 1997, we had about one million square feet of open floor space; something like 47 per cent of our 240 listed buildings were at risk. We decided that we needed to protect the legacy of Richard Grainger and to concentrate on quality in terms of our urban regeneration. One of the biggest problems we faced was changing the negative perceptions of a lot of developers and property owners. It took a period of probably three to five years to change their perceptions. One of the greatest things in many ways that we did to change those perceptions was to look at international best practice, particularly through the work of (URBANE) to concentrate on quality, but also to look at a series of demonstration projects in the area. We looked at a high profile mixed-use scheme and concentrated on high quality, public role improvements. We worked through a series of partnerships within the area to ensure comprehensive regeneration within the six years of the project.

Mr Burchnall: I will keep this short so as not to repeat what has been said already. My aspect is really to think about what creates good urban regeneration and that is about creating an environment which meets the needs of local people, stakeholders and businesses. If you do that and then think about historic buildings, to most people, historic buildings do define the community, and therefore they are a vital element in terms of good regeneration. I would not pretend that is easy. Like Newcastle, we have a huge heritage of listed buildings and conservation areas. Some have been easier to deal with than others. In terms of major listed buildings and major schemes, those have been the catalyst in areas where there has not been funding and priority. Certainly historic buildings have been important but they have been much harder to deal with. Presumably we will get into that later.

Q2 Christine Russell: Before we move to Manchester, could I ask Mike Burchnall a further question? What role do you think Liverpool's historic fabric, if you like, played in helping you to win the City of Culture designation? How much did you play on it, in other words?

Mr Burchnall: The historic environment played an enormous part but in a subsidiary capacity in one sense. In terms of the criteria that any bidder had to meet in terms of Capital of Culture, both the European criteria and government criteria, heritage did not figure very highly because that is about place, the quality of the experience of a place and the culture of a place. If you then turn it round and look at Liverpool and ask about the quality of the experience in Liverpool, you cannot disassociate that from the heritage and therefore, in terms of the bid documentation, having that on the cover meant that we had a head-start over many other people who were actually bidding. A lot of the key projects within the bid itself, which we need to deliver by 2008, are linked to heritage.

Mr Babb: If you look at Manchester city centre, there is a large number of listed buildings and conservations areas. There are something like 450 listed buildings. If you think of the total proportion of buildings within the city centre, it is inevitable that the historic environment for listed buildings needs to bring those buildings back into use to play a fundamental role in regeneration. Take, for example, the cotton warehouses that were redeveloped for residential use, that kick-started a growing population in Manchester to what it is today with about 6,000 people living in the city centre as of the 2001 census. That is probably an underestimate. That kick-started new building in the city centre and added to the regeneration of the city centre by providing new uses. That gives a propensity for other listed buildings to be brought back into use and to care for the historic environment. Now, for example, when we are looking at master planning for parts of the city centre, we place a specific emphasis in terms of how we can look after the historic environment with new-build schemes as part of the massive planning process. Outside the city centre, there is a growing recognition of the value of the historic environment and buildings to the extent that in East Manchester the regeneration framework actually identified the Ashton canal corridor as a place where buildings could be brought back into active use so that they would contribute to the heritage of the area. In North Manchester the regeneration framework has been delivered and as part of that we have just recently declared three conservation areas. In fact that was last week. I think you can see the value of regeneration. That is in the Crumpsall area. That puts the value of conservation to the forefront in terms of looking at the sustainability of local communities because the imperative for looking at our historic environment is coming not just from the public sector but from the people themselves, who are part of the regeneration schemes and participation in that.

Q3 Christine Russell: In your heritage-led regeneration schemes, how effective did you find the statutory powers that you already had? Would you like stronger ones? What is missing?

Mr Babb: If I were to take the example of a heritage-led regeneration scheme, I would have to talk about Ancoats, an area which is part of a potential heritage site for the future. It was declared a conservation area back in 1986. There were big problems about how to go about securing that area for the future. There were various arson attacks on buildings; buildings had to be subject to statutory powers to try to make sure that they did not fall into further disrepair. It is a long convoluted process going through the powers that we have to bring about stability to those buildings, serving of notices and so forth and then through the inevitable CPO process. Fortunately for Ancoats, the North-West Development Agency actually became involved and used its powers to secure a huge area of Ancoats and that will pave the way for the critical mass that is necessary.

Q4 Christine Russell: Are you saying that the powers that you have as a local authority are not strong enough and effective enough and that they are far too complex?

Mr Babb: They are complex. As for the value of the powers of the development agency, it does not really have to go through a fully worked-up scheme for prosecuting the CPO. In fact, if we went through CPO processes elsewhere, basically there would have to be a fully worked-up scheme and the back-to-back arrangement with a developer to take over the site or the building.

Mr Burchnall: I think that is right in relation to that. One of the issues is that the NWDA powers of compulsory purchase are much easier to use and you do not have to go through all those processes. In terms of dealing with conservation areas and listed buildings, again, that is deemed not to be an appropriate tool in certain cases. We have been trying to use those powers in that area of Liverpool and, because of lack of support funding and because it is not as comprehensive an approach as Ancoats, we cannot use those powers; we are left with the planning powers, which I would agree are very difficult and convoluted to use.

Q5 Christine Russell: Will the measures outlined in the Planning and Compulsory Purchase Bill help you at all when you are talking about historic buildings?

Mr Burchnall: In all honesty, they will not. My own view, and I think it is a view shared by a number of people in Liverpool, is that owning a listed building or owning a building in a conservation area is a very important attribute. If local authorities are to be serious about conservation, then local authorities need to be given greater powers to acquire those buildings and to do that much more simply and easily.

Mr Oldershaw: There is a general point in relation to listed building consent, planning consent and COP powers. The issue for us has not been the actual process but the timescale in terms of making sure that we get those decisions through quickly, whether it is through the planning inspectorate or whether we get high priority with a local authority in terms of process and planning applications or with English Heritage. The timing is critical with time-limited regeneration projects like Grainger Town.

Mr Babb: In looking at CPO activity, there is a basic difficulty of the compensation being lined up with, if you like, the principle of a scheme and being heard at a public inquiry. In fact, a lot of people want to earn some reward for the land that has been taken from them. It is about compensation and not necessarily about the principle of the scheme, and yet the inquiry tends to focus on the principle of the scheme and the compensation is sorted out elsewhere. That really is a grey area that needs to be addressed.

Q6 Mr Cummings: When dealing with listed buildings and conservation areas, local planning authorities generally require full and detailed information as to what is proposed. Are your staff generally aware of the level of professional fees required to produce detailed information in support of the applications, and what flexibility can you offer to help reduce developer risk?

Mr Burchnall: In terms of colleagues knowing the costs involved, yes, I think people are very much aware of those costs. Dealing with the historic heritage of the city is vitally important. It is important that developers recognise that they need to invest up-front in relation to doing work on historic buildings. Having said that, there are mechanisms that we can use for reducing the risk and the cost to developers. A major city centre scheme which Liverpool is pursuing at the moment with Grosvenor, which I think are appearing as a witness later on, involves historic parts of the city and major new development. We have dealt with a process there which delivers detailed permission on certain parts of the site and outline permissions on the remainder but gives the Council and the Secretary of State the certainty needed in relation to those historic areas. We are very much aware of the risk that developers are involved in. We are looking at mechanisms to try and reduce those.

Q7 Mr Cummings: What flexibility can you offer to reduce developer risk?

Mr Burchnall: Developers look for certainty and through our development plans process and the lining up of funding to secure and aid development, we can reduce risk in those areas. One of the issues we have at the moment is that funding regeneration, funding the re-use of listed buildings, is very complex and there can be a cocktail of funding. A developer wants to have all that funding in place so that he reduces his risk at the outset. I am not sure that we have actually achieved that as yet because we look to put a cocktail of funding together. If one person who is providing funding falls out of that, then the scheme is at risk and the developer is at risk. If we can have more secure means of funding on a long-term, sustainable basis, that will certainly reduce the risk for developers.

Q8 Mr Cummings: Are you saying you can offer flexibility or that you cannot?

Mr Burchnall: I am saying that, as a local planning authority, we can. Heritage is a very complicated issue and involves many agencies. The local planning authority is not the funder of last resort normally in relation to regeneration schemes. In Liverpool, we rely on English Heritage and Heritage Lottery funding.

Q9 Mr Cummings: Can you or can you not offer flexibility to the developer?

Mr Burchnall: We can offer flexibility in terms of negotiating the scheme. I am trying to link that to the second part of your question, which was about reducing risk. We can encourage flexibility; reducing risk is the difficult part.

Mr Oldershaw: I have a general comment with regard to gap funding, which is the main source of funding we used Grainger Town. We would generally make a higher fee level for listed buildings, typically 2.5 per cent higher than for an unlisted building, when we are carrying out the development appraisal. In terms of trying to reduce abortive development costs, there is an imperative on behalf of the developer to come to an early meeting. We have a project executive and have discussions with heritage officers to make sure that they are designing a scheme which is likely to get planning permission. That is where much of the costs and the wastage of fees come in, by delaying until far too late in the day decisions being made. If there had been an early meeting with the planning authority and with the executive, as in Grainger Town, that would have avoided some of those extra costs.

Q10 Chairman: Are you confident that you have the resources and people available to make initial contact?

Mr Oldershaw: During the lifetime of the project, we had a dedicated heritage officer and the developers generally would come in without even appointments to see us on a regular basis. We would basically act as a one-stop shop and we would call in appropriate professionals to guide them through the process. That worked incredibly well.

Mr Babb: In terms of the development control process that we have operated in Manchester over a significant period of time, if we had not been flexible in dealing with the private sector developers, I do not think we would have the development on the ground that we have now. Most of this I think goes down to how we negotiate schemes, particularly with the involvement of English Heritage. It is incumbent on all the parties to give consistent and straight-forward advice of what might be acceptable and what might not. That clarity of view is important. That is why in Manchester we have built up a good network of architects and developers and we understand where each other is coming from. We find it easier to find a way forward with what are often very challenging schemes.

Q11 Mr Cummings: I address this question to Liverpool City Council. Obviously the City Council, in conjunction with DCMS, is strongly supporting a bid for World Heritage Status, a designation focusing on the historic city centre. By its nature - and we have been informed of this - the World Heritage Site status imposes greater regulation on the historic environment. Are you not then concerned that, if successful, you will actually discourage potential developers and other private-sector partners, who will fear more complicated procedures and a less flexible attitude on the part of your officers?

Mr Burchnall: Certainly, if we are successful in being a World Heritage Site, that is a material consideration in relation to planning applications. What we have sought to do, through the World Heritage Management Plan, which the Deputy Prime Minister has recently supported, is to put in an arrangement whereby it is very clear that because of the type of World Heritage Site we are, that site will change over time. You said that is in the city centre; it is the docklands area, the city area and the artistic area around William Brown Street. That is an area where development is taking place at the moment and will continue to take place. That will make sure that we get the highest quality development in there. We are very careful about the development that goes into the World Heritage Site. I am a little more relaxed in one sense because, in terms of Liverpool, developers want to be in Liverpool. With World Heritage and the Capital of Culture designation for 2008, again development is being encouraged in Liverpool. Therefore, that should not act as a disincentive. I hope it will act as an incentive, that people will want to develop in the city.

Q12 Mr Cummings: Can you perhaps tell the Committee how you have involved local people in your heritage-led regeneration?

Mr Burchnall: In terms of the community strategy Liverpool First, which was one of the pathfinders for the community strategy, that again used heritage as a main element of it. If I were critical of it, I would say that perhaps we have not developed it as much as we should in terms of community targets for heritage issues within the community strategy, but certainly the community was involved in that. In terms of developing major schemes, and the major scheme in the city centre, that has had a large amount of public consultation and direction. One of the things I would pick out is that a lot of the heritage we think about automatically is city centre based. As Chris Oldershaw said earlier, a lot of it committed outside the city centre in areas that are much harder to deal with and areas where heritage is important to local people and it defines the local community. As we move into a major area for the city, which is about housing market renewal, we need to try to retain those areas of heritage which are important and which the people, through the partnerships, are telling us are important and focus redevelopment on those areas that are clearly of lower quality. We are involving the community from the strategic sense, the scheme development sense, and into the local area.

Ms Toms: I would like to add that, just as in Liverpool, community regeneration is becoming more and more important within Manchester. The story of regeneration in our city centres has been well told and is well documented. The particular reasons why that has been successful have also been well documented. Our challenge in Manchester now, with many of our wards having the lowest deprivation status in the country, is to take the models of best practice within city centres to make sure that that benefit can be carried out within regeneration areas in the wider community. There is a number of ways in which that is now taking place in Manchester. One of the themes, picking up from what colleagues have said earlier, is partnership and regularly working together as agencies because that has made the difference. When you have a regeneration strategy which is area-focused and focused on a particular community, you tend to come to the best solutions for that area. By listening to local people, which we do more and more, we have noticed recently that the trend is towards a real understanding and sympathy for the historic environment, and in Manchester particularly not just the built environment. A project such as the Victoria Baths project clearly was based on an historic building but the number of people who voted for that project reinforced the message that the historic environment is very important but people's social history is too. Heritage and social history are closely aligned. Like Liverpool, that is embedded in both our community strategy and our cultural strategy. That is why Manchester is represented here by both cultural strategy and planning.

Q13 Mr Cummings: May I address the next question to the Grainger Town Partnership? Your evidence stresses the need for partnerships with the commercial sector. Can you tell the Committee how willing commercial partners are and their professional advisers to engage with the community and what mechanisms did you put in place to ensure that appropriate levels of engagement were achieved?

Mr Oldershaw: We have gone for a formal structure within Grainger Town. We set up a company limited by guarantee with 20 directors, including six from the private sector. We set up a business forum and a residents' forum to support that as well. Those met on a monthly basis and were able to go through all the board papers and to comment through the chairs of those meetings, who are also board directors, on strategy and also on implementation. We regularly had about 16 businesses meetings together going through the board papers. Those were representatives of all the various sectors within the Grainger Town community. We have also invested heavily in the skills base within both the business and the residents' forum. We have taken both of those groups to see examples of best practice in places like Liverpool and Manchester and also to Glasgow and Edinburgh. We even went over to Temple Bar. It is only by taking them to places like that where you can see examples of best practice that you raise their aspirations and start to develop a feeling of what is possible in terms of regeneration. That takes time. We built up a lot of confidence, commitment and trust in the area. Certainly, in the first couple of years it was very difficult to get people on board. That has held together very well over the six years of the project.

Q14 Christine Russell: May I perhaps follow on the same theme? One of the main criticisms of heritage regeneration is that it can lead to gentrification, spiralling house prices and booming commercial rents and, as a result, the indigenous community, if I can call them that, are displaced and small businesses are forced out. Do you feel that is a valid criticism? I know, for instance, that in the centres of Liverpool and Manchester you are now looking at one- and two-bed-roomed apartments that are selling for well over £140,000, way beyond the reach of most people in need of affordable housing. How do you counter those criticisms that what you are really doing is just putting the prices up and gentrifying the area?

Mr Oldershaw: The crucial point in many ways is to start out with a coherent strategy. We decided right from day one that we wanted a lot of choice in Grainger Town in terms of tenure and price within the area. Some of the early housing schemes were carried out by housing associations providing accommodation at market rents. That helped to create investment confidence in Grainger Town and, after about two years, we started to get some of the bigger private developers coming in and creating owner-occupied accommodation. We are now able to offer choice both in terms of tenure and price. The price range typically to buy is from £80,000 to £500,000 within Grainger Town. Rental levels start at about £60 to £80 per week. These are very accessible to the general public.

Mr Burchnall: If I use Liverpool as an example, in terms of one area, which is the Canning area, the Georgian area of Liverpool that in 1981 was in a very poor condition with many vacant properties, housing associations were instrumental in turning that area around with the support of English Heritage and the City Council. The housing associations themselves have faced problems in those areas and the private sector is now beginning to help out there. The city centre is a driver for economic activity. Without what is happening in the city centre at the moment, Liverpool would not be beginning to be as prosperous as it now is. I tend to think that, rather than offering opportunities within the city centre, the City Council needs to use the economic activity, the driver, to reinvest in the peripheral areas and make the opportunities available in those peripheral areas. Those are the areas where we have real housing problems at the moment.

Q15 Christine Russell: That is not really a mixed community, is it, if you have the rich living in the city centre and the poor in the outskirts?

Mr Oldershaw: In terms of the closeness of our areas, they are actually very close. The inner areas are very close to the areas which have the biggest house prices at the moment. To try and mix the two would be quite difficult and might cause problems in terms of those areas which are regenerating at the moment. My feeling is that we should use the economic driver there to reinvest in those other areas, build back those communities, put in good schools, housing, shopping et cetera. A housing mix within the city centre is a difficult thing to achieve.

Mr Babb: In terms of the housing market within the city centre, that is rather different from the housing markets around. It is not really gentrification because people have not been living in the city centre for quite some time. It is basically people who have come in into converted cotton mills and new mill schemes and so forth. In the northern quarter area of the city centre, housing associations have been acting for many years and continue to do so. That is a grassroots type approach to regeneration. We are not looking for massive change. That will continue into the future. What we would like is for some of those activities to spill out into the suburbs where we have housing markets that are not in balance and have too much core housing. We need to look at a better mix of housing. That is why we are a pathfinder for housing market renewal. Not a short distance from the city centre you can find houses at very affordable prices, some would say too affordable prices, and people do not want those either. It is a question of trying to get the balance right.

Chairman: Christine Russell will take us straight on to local authority officer expertise and resources.

Q16 Christine Russell: One of the memoranda that we received was from Grosvenor Estates. I am very familiar with them as they operate in Chester, but they are also busily engaged in Liverpool I believe. In their memorandum, and I will quote it to you, they state: "inexperience/lack of resource of local authority planners leads to delays, lack of decision making and lack of imagination". How do you answer that?

Mr Burchnall: Is that Chester or Liverpool?

Q17 Christine Russell: I do not think they specify?

Mr Burchnall: I think generally they may have an issue with local authorities. Clearly a lot of local authorities are not geared up to the major development pressures which we are currently having, particularly in the north-west of England. I think we have struggled. We have redirected resources so that we have concentrated key individuals on major schemes. That is particularly true with Grosvenor. We increasingly rely on real partnerships. Our partnership with English Heritage has been vastly important to the city, where we have not had the resources or the skills in-house to push World Heritage to work on buildings at risk. We jointly funded posts with English Heritage to bring in that expertise. We are under considerable pressure as a planning authority. We have used the planning delivery grants to supplement those resources and to partner with the private sector to bring in those resources that we do not have. It is an issue and one that we are addressing. It is not an easy issue, and particularly in terms of the local authorities competing with the private sector, that can be difficult.

Q18 Christine Russell: May I ask you about your conservation officers, because those are the people who usually seem to be on the receiving end of the stick. The developers say that these guys, and the odd woman who is a conservation officer, have no idea about the local economy and the need to regenerate. Do you think there is a problem with the professional local authority conservation officer?

Mr Burchnall: I do not think there is. This depends on the way that you use conservation officers, and we use them as a partnership with development control officers so that the totality of the scheme, the economic importance, can be balanced against the conservation issues involved. As long as you use that partnership, then it is not a problem. You do need the expertise and the drive that comes from professional conservation officers, sometimes tempered with the reality of a department control officer.

Mr Oldershaw: I would like to make a general comment. Certainly from our experience in Grainger Town, we have experienced the City Council that is very positive in the sense that it has excellent conservation skills and also English Heritage. The area perhaps of weakness in many ways is the property professional side. Ideally both the City Council and also English Heritage ought to have access to property surveyors so that they can advise the local planning authority on the commercial realism because that inevitably is a process of negotiation between the local authorities and the developer. The local authorities would be assisted if they had professionals advising them on the commercial realism and economic viability of schemes, what is possible working with the grain of the listed buildings. There is certainly a gap there at the moment.

Q19 Christine Russell: And that is a gap that you have within the local authorities, is that what you are saying?

Mr Oldershaw: In Grainger Town we are very fortunate because we had a Conservation Heritage Officer with the executive team but also property professionals as well.

Q20 Christine Russell: Those were not local authority property professionals?

Mr Oldershaw: No, they were working from us, although they are employed by the City Council. They were advising us on whether a scheme stacks up, whether it is deliverable, given the conservation merits of the scheme. It was a very useful debate to have within the team to argue about how many elements we could retain, for example, of the listed building and those that it was possible to move if necessary to get the scheme off the ground. There was a balance that we managed to strike by having the best possible advice within the team.

Q21 Christine Russell: Do you have conservations officers within the real world in Manchester?

Mr Babb: I would turn that round and ask: what is the quality of the scheme that is coming forward? Frankly, we do not always see quality in schemes. You can have several pre-application discussions and give advice, good quality advice. I have an architect planner as my lead design conservation officer who really does know an awful lot about the commercial realities in which developers live. When an application is submitted, we still do not get the scheme that we thought we had negotiated pre-application stage. Maybe the penny has not dropped but we do get to the ridiculous extent that for some schemes the developer comes with lines on the design for the conservation officer to try to redesign the scheme for them, and then complains that he has not actually had time to do it for them. That puts an onus back on the development sector to make sure that its schemes come forward in a fit state. We hold up quite a lot of schemes because they do not have all the information when they come in when we are looking at schemes for listed buildings and conservation areas.

Q22 Christine Russell: Could you give us an example?

Mr Babb: I would rather not. I can think of several schemes, ones that I would not name and I would not want to disclose the name of the developer, but there are many and there are many developers who do not actually use registered architects, for example, or planning consultants to put together a statement under PPG15, for example. These things do not help in processing an application. If it takes longer to process an application, that is probably not surprising. We are stopping some of these applications going forward for processing until they are fit for those considerations to be given, and also fit for the consultation that has to be carried out with English Heritage and others.

Q23 Chairman: So your role model is one of good practice. Do you have experience more widely of your colleagues in other parts of local government or would you rather not pass judgement on them?

Mr Babb: For a city like Manchester, I think we are able to attract staff to do the job. In terms of design and conservation, we are quite fortunate. For some smaller authorities, it might be different and difficult to get staff of the right calibre needed to carry out the work that obviously is needed to inform the development sector about what is appropriate in terms of applications coming in.

Q24 Chairman: That is, let alone to be able to afford a properly specialist?

Mr Babb: Yes.

Mr Oldershaw: I wonder whether it may be feasible for either English Heritage, through their regional officers or through sub-regional partnerships, to provide a specialist service. Structural elements is another area which in many ways need more attention. If they are able to make a property professional available to local authorities within either the region or sub-region as a specialist resource, that could work well.

Q25 Mr Cummings: By its nature, heritage-led regeneration requires the cooperation of local authority staff across many departments and professional competencies. How has your authority achieved integration in these very difficult and different areas?

Ms Toms: From Manchester, the models of working practice that we have developed in Manchester are very much based on the fact that regeneration is at the heart of the City Council's strategies and therefore that approach to partnership comes from the root of every way that we work. More recently, because, as I was saying before, cultural strategy lies very much at the heart of our community strategy, we have been able to develop over the last few years a very close working relationship with the Heritage Lottery Fund. Now that they have a north-west base, they are substantially more influential in terms of their knowledge of the local area and particularly the relationship between our own planning authority and English Heritage in that context. By having a shared agenda, which is regeneration needing community regeneration, it is much easier to put into place those sorts of partnerships.

Q26 Mr Cummings: My question was basically aimed at local authorities. I understand that you are saying that perhaps the same level of cooperation does not exist in local authorities.

Mr Babb: Planning and cultural strategies both work within the regeneration division of the Chief Executive's Department. There was a conscious decision to get people together from those parts of the organisation delivering services so that we actually shared the same agenda, which is the same agenda for the whole of the City Council. In fact, we have corporate aims and objectives; we have a vision. That is really all about regenerating the city. Basically, most members of staff, especially senior ones, are absolutely on message about what we have to deliver.

Q27 Mr Cummings: You are all pulling in one direction?

Mr Babb: Yes.

Q28 Mr Cummings: Could I ask the Grainger Town Partnership to answer the next question? How easy was it for your own partnership to achieve a coordinated response from Newcastle City Council and Tyneside TEC, which is now the Learning and Skills Council, in areas that are not strictly confined to the regeneration of the physical environment?

Mr Oldershaw: I will answer that in two parts. Perhaps I could address the urban design first. We set up an urban design panel to vet all major applications for funding major schemes within Grainger Town. That involved the local authority, universities and local architectural practices, both heritage architects as well as contemporary architects. That was chaired by the North East Civic Trust. They went through all major schemes and provided specialist advice to the partnership. With regard to the Learning and Skills Council, that was actively involved through the partnership board that is one of the board members. We also had a training and employment access group, which they part-chaired. We are trying to ensure that the employment and training opportunities created by the regeneration work in Grainger Town were passed down the line so that long-term unemployed people, and young people in particular, could access some of the job and training opportunities. We set that up in the second year and continued it through to the end of the project. That has now been picked up by the City Council and has been introduced for the whole of the City of Newcastle. That process started in Grainger Town and it has now been picked up by the City as a whole.

Q29 Chairman: I think there is generally widespread agreement in the heritage community about the need to do something to reduce VAT on works to listed buildings. Are there any other fiscal measures which, in your opinion, might assist with the regeneration of the historic environment and make it more attractive to the private sector?

Mr Burchnall: To echo a point I made earlier, fiscal business is about funding. As for the complexities and the cocktail of funding that has to be put together to support major historic regeneration projects, we are indebted to a number of agencies for the funding which goes into schemes, but securing those can be difficult and doing so on a long-term basis can be difficult. The key is to get sustainable, long-term funding for heritage projects. That is getting better but there are still gaps. We have examples of projects where we have had promises of funding based on getting five or six different sectors of funding to contribute; if one pulls out, the project is delayed or has to be abandoned. That is still a big issue in terms of funding heritage projects.

Mr Oldershaw: One of the biggest difficulties we have faced in recent years is the withdrawal of gap funding in December 2000. We need greater clarity about the new grant regime. Certainly in terms of Grainger Town, we would not have got any of the schemes off the ground back in 1997 without gap funding. Although values have improved a lot since then, there is still a need, in terms of the costs of heritage and of listed building conversations, to provide a degree of public support. Greater clarity on gap funding would help tremendously in that area.

Mr Babb: In Manchester we have quite a number of locally significant buildings, not listed, not in conservation areas, which are under threat because demolition does not require consent from the planning authority, as you are probably all aware. To bring demolition under planning control would be rather a good thing, rather than what we have to do at the moment, which is to look at a programme of conservation area designations and to protect some of these buildings that are very important for local communities, but we do not have any power over their demolition. We would rather have a proactive approach than a reactive approach.

Q30 Chairman: That is not a fiscal measure but it has a financial impact on the developer?

Mr Babb: Basically, it would mean that we could negotiate. If a developer wanted to demolish a building, there would have to be negotiation, if we had the jurisdiction. We do not have the jurisdiction at the moment. In Manchester, over a period of time, we have had buildings of local significance which have been bulldozed overnight. We have no locus to become involved, apart from when a development scheme comes forward for the now vacant site. Those buildings often can be very important for local communities. We are now looking at a programme of conservation area designations to try and protect those areas that we think are more vulnerable. We have looked at the idea of local lists. We do not think that local lists afford any benefit whatsoever as many of these buildings are not listed because they are not in conservation areas.

Q31 Christine Russell: This follows up on what you have mentioned, the cocktail of funding and the complexities in the present system. You seem to be saying that you want to see a restoration of a gap scheme or a scheme similar to gap. May I press you, in the light of your experiences in your three cities? Are there any good things that you have managed to achieve in Newcastle, Liverpool or Manchester, good practices that you could share with the Committee and with each other? Do you have any ideas, other than the two issues that have just come forward, to improve the present system?

Mr Burchnall: The one thing that I would draw to the Committee's attention is the partnership we have with English Heritage. English Heritage and the City have perhaps not had the best relationship over the years. We have realised that in terms not just of protecting listed buildings but of looking at heritage and culture generally within the City, we need to form an alliance with English Heritage and develop a programme with them. This is called the HELP project; it would be HELP in Liverpool. That has a number of elements in it and it has been very important in bringing English Heritage to the City, bringing national figures to the City, and selling heritage to them. That then has a knock-on effect in terms of the local community and the press, et cetera. It is a high profile partnership arrangement, and there are partnerships with CABE and the private sector as well. The partnership with English Heritage I would flag as being very significant

Q32 Christine Russell: May I ask you a final question about the review of listing that is going on at the moment? What are you looking to come out of that review from a local authority point of view? It could be a useful and helpful outcome of that review that DCMS is presently conducting.

Mr Babb: In any provisional listing or looking at listing, the local authority should be consulted for their views before any buildings are listed, otherwise you can end up with buildings that we would say probably should not be listed. Difficulties would be created for their re-use in future. An example of that was the CIS tower within Manchester, which neither CIS nor the City Council really wished to see listed. In terms of going through looking at various maintenance alterations, it is giving us a bit of a headache, and the CIS one too, as to whether LBCs are needed or not. We need a degree of understanding and a sensible way forward.

Q33 Christine Russell: Is there no consultation at the moment?

Mr Babb: My understanding is that there has not been consultation in the past. Whether that is changing or not as part of this new regime, I am not sure. Maybe other witnesses will be able to tell you.

Chairman: May I thank you very much for your evidence and taking the time to come today.

Witnesses: Mr Martin Bacon, Chief Executive, Civic Trust, Mr Eddie Booth, Chairman, and Mr Dave Chetwyn, Consultations Secretary, Institute of Historic Buildings Conservation, examined.

Chairman: Good afternoon and welcome. We have had your written contribution. Do you feel the need to make any further statements before we move to questions? You do not.

Q34 Mr Cummings: I address this question to both sets of witnesses. What contribution do historic buildings make to urban regeneration and what, in your view, are the ideal conditions for this contribution to be maximised?

Mr Chetwyn: If we look really at all cities and towns around the United Kingdom, we have seen increasingly in the historic environment and urban design a concentration on the quality of the public realm and a fundamental element of delivering not only regeneration but much higher value regeneration. We have seen three very good examples of that but there are numerous other cities and towns as well. It is particularly important to note that often in these areas there are more specialist developers operating now who are specifically targeting historic buildings and specifically targeting these areas as part of their product and marketing approach. Where this has occurred, we have seen design and conservation operating as a catalyst for quite radical transformation, often turning round areas that no-one would invest in to quite high value areas and areas where a lot of people move in to live, to work and to spend recreational time. There are also very significant economic development outputs from the built heritage. I have some research that was done in the USA by (O'Donovan D Rype Keamer). I can put this in as supplementary evidence later. Some of the findings of this research, and this is by an economist rather than someone who works in the conservation sector, states that investment in building rehabilitation as opposed to general industrial investment delivers far higher incomes, a lot more jobs on average, in terms of heritage-based tourism and money spent particularly in historic environment attractions, which is matched by vast amounts of expenditure in the wider economy. The example he gives is in Toronto where heritage visitors spend $3 on an historic site itself, and that is matched by $97 elsewhere in the local economies. The historic environment has a crucial role to play in small business incubation. The historic environment is very wide. These are often very small buildings in industrial areas that are sometimes tucked away as part of the traditional industrial core. The historic environment particularly supports small businesses, businesses that employ fewer than 20 people. That is especially important for businesses in growing sectors of the economy: hi-tech industries and things of that nature.

Chairman: We would like you to leave a copy of that with the clerks.

Q35 Mr Clelland: You made a comment that the number of jobs generated tends to be higher on this sort of site rather than on new-build. Are you talking about jobs generated in the actual redevelopment or jobs generated afterwards in the businesses which follow? Obviously, in terms of redevelopment, you can see why there would be more jobs in that than in new construction.

Mr Chetwyn: I think these are jobs delivered by the investments. There could be elements of both but I would have to research that.

Mr Bacon: On the first part of the question, the Civic Trust takes that as a given, that successful regeneration does require really carefully attention to the historic environment. By that I mean not just buildings but also the spaces. If you look at a number of the publications that have come out over the last five to six years from BURA, English Heritage, Business in the Community and Civic Trust awards, you can see that that is a given. We are really talking about the degree to which we can make that work more successfully for local communities and for the private sector and how we can build on that record of success. As regards the ideal conditions, it is important that all the people involved in regeneration, say in a place like East Birmingham, understand what they are dealing with and that they undertake the proper surveys of what is there. So often one finds that the temptation is to dive in because of some economic problem and not really understand what you are dealing with. Secondly, what is required is openness and a debate about what is there, what can be afforded, what is needed, and a commitment to excellence, as we heard from the previous witnesses, and a recognition too that development has to pay for itself at the end of the day. There is that crucial balance between what can be kept and what can be afforded. That has to be discussed in a very open way between the development industry, the local planning authority and local people.

Q36 Chairman: Is there not a conflict with what developers are prepared and indeed able commercially to put on the table?

Mr Bacon: There may be sometimes, yes, and that is why things like gap funding and other financial regimes can help over that short to medium term time span. There is no doubt that in the view of the Civic Trust if you look at the sustainability of our urban areas, we ought to be making as much use as we can of existing buildings and their fabric. We cannot go on for ever digging up our countryside for bright new minerals and everything else. There is no doubt about it that if we can do it that way, it is more sustainable. It may be an issue of timescale for the development industry.

Q37 Mr Cummings: This question is to IHBC. You state in your written evidence: "It is often the areas that most need to use urban design and historic buildings as effective regeneration tools that consider them as peripheral and low priority. Thus regeneration opportunities are being missed through simple lack of awareness and low levels of urban and economic literacy." I represent an area of very high deprivation and I know that statement is both arrogant and insulting to people who give their lives, with limited resources, to try to improve the environment and buildings in the area they represent. Facing deprivation is a real problem. People are expending their efforts and limited resources on more pressing issues than the historic environment, such as health, education, reduction of crime and poor quality housing. Would you like to tell the Committee why you made that statement, which is certainly going to upset, indeed infuriate, many people who are working for the community in areas I represent?

Mr Chetwyn: I wrote those words. I live in an area that suffers from considerable deprivation. I was born in that area and have worked in it the whole of my life and care very much what happens to the area. The reason I wrote those words is that many cities have managed to use design and heritage regeneration to deliver a wide range of economic benefits, better paid jobs, more choice of employment, more choice of cultural facilities, better housing and improved self-image for the city. That is extremely important. The areas that are suffering most from deprivation really need to take these issues most seriously but often, because they have not dealt with the kind of developers that regenerated the cities we have heard about, they just have not developed the experience yet. This is really about transferring best practice and knowledge of what is possible.

Q38 Mr Cummings: I live in a deprived area. You have said that these people are not aware. I find this absolutely astounding.

Mr Chetwyn: May I finish my answer? It is really about raising aspirations. In Stoke on Trent we have made great efforts to import an awareness of how design and heritage are being used to attract higher value investment. It is not just investment but moving away from the very understandable "investment at any cost" point of view to looking at better quality investment and investment that is going to deliver higher paid jobs and more choice and opportunities for local people. I passionately believe in that.

Mr Cummings: I am afraid we must disagree on that.

Q39 Christine Russell: May I ask my first question to Martin Bacon and to the Civic Trust? I would like to hear your views on what role you feel local communities have in delivering conservation-led regeneration and whether or not you feel that local communities are getting a stronger voice. To quote your evidence, you have said that the public have a feeling of powerlessness.

Mr Bacon: I think it is true to say that, whether they are civic societies or not, there are many local groups right across the country that love their historic environment and do a range of very small-scale projects right up to quite large ones. I understand that you have been to Norwich. You will have seen the wonderful state of that city centre, and that is very much due to the role that the Norwich Society has played over the years since the 1920s. Indeed it celebrated its 80^th birthday recently. They were there pushing forward things like pedestrianisation, painting schemes, shop-front controls and restoration of unfashionable buildings in the 1920s and 1930s, which are now quite fashionable and so on. They have played a major role. There are other civic societies that go in for smaller sorts of projects, such as in East Retford where they are working with the local council to restore a landmark building, a church in their area. Desborough Civic Society will be using a disused shoe factory in the foreseeable future for a heritage centre. Cromford Mill in the East Midlands, and you may know it, was a series of industrial mills which were taken over by a civic society and now provide jobs for 100 people. At Burslem Port, which I visited in the Stoke area this summer, a whole series of community groups came up with a plan for the canal which comes off the Severn-Trent Canal. They have produced a regeneration plan for heritage and jobs and everything else, which is now attracting support from the local council and from the RDA. Local communities are very much involved. Your question is about whether or not they feel powerless. There is a tremendous amount going on. Keeping pace with all of that and the various agencies involved bewilders people from time to time. The development industry and the public sector do not undertake public consultation very well. They often do not research enough about who is in an area and, secondly, what techniques to use to involve them. Many people think about calling a public meeting and wait to see how that goes but that is not really the best thing to do. The reason why some people feel powerless and fed up with the whole process is because they invest a lot of their personal time in these things and then nothing happens or, if something does happen, they do not hear about it and they are not kept informed. There is a lot to be learnt there by all sides. From the point of view of the civic societies and the local groups, they need to understand how the money machine works and how things can and cannot be afforded. There is a real dialogue to be had between the three sectors. It is not just us saying, "They do not know how to consult". There is learning to be done in the community sector as well.

Q40 Christine Russell: In general, what you are saying is that there is a willingness on the part of local authorities to go out and consult with local communities

Mr Bacon: Yes, I think so

Q41 Christine Russell: It is jut that the consultation process is not being run very competently, it is not very well organised

Mr Bacon: I think sometimes it seems as just an add on

Q42 Christine Russell: Can I ask both of you the question that I put to the three cities who have just given evidence, which is how you would comment on this argument that, so often, heritage-led regeneration seems to lead to gentrification, rising house prices and small businesses being forced out of the area. Do you feel that that is a problem and, if it is, how should we tackle it?

Mr Bacon: I think that the gentlemen from Newcastle and Manchester had the answer. If you just see urban regeneration as a physical thing and not a social economic thing as well, then you are going to get that result We have moved on a lot since the sixties when we just drew lines around conservation areas and we gave grants and so on - we have moved a long way since then - and one talks to housing authorities and housing associations and there is a collective partnership as to how you can bring all those agencies in to get the best balance that is considered right for that area It is not the problem of a care for heritage buildings that pushes the prices up, it is the housing market because the whole issue of intervention in the housing market is possible for a whole range of mechanisms that are not being applied in that particular area. So, we should not kick the horse that is delivering the benefit

Mr Booth: Can I add that you could make the same argument for new development. It is not the heritage factor necessarily that is driving the argument that you have put. In Docklands, for instance, both new world development, similar effects. So, it is not just to do with heritage regeneration. The other factor is perhaps that creating value is what it is all about and how you deal with value is another issue, and whether you create value and make compensatory gestures elsewhere or whatever - there are ways and means I am sure, but we are interested in creating value

Q43 Christine Russell: So, what you are saying is that where the local authority has a determination to create an inclusive development where there are important historic buildings, that can actually happen if they are determined from the outset but that they are going to have affordable houses, affordable workspaces, etc

Mr Booth: I believe so, yes.

Mr Chetwyn: Could I add as well that much of the built heritage is not in these high-profile areas we have heard of. There is much that just is the fabric of everyday life. I work with a number of residents and a number of small businesses and medium-size businesses, community/amenity groups etc and it is just the everyday buildings. It is part of the fabric of our cities. So, there, the value thing tends to come in where you get a concentration of inner city regeneration and where you get a new housing market. That can be good as well particularly again coming from a city that has suffered from suppressed land values, that city living market and trying to raise values as part of a city, that is actually an essential part of regeneration and attracting the right kind of employment and opportunities into the area You need some of that but much of heritage regeneration is small scale and more scattered.

Q44 Christine Russell: So, you would totally rebut the argument that is sometimes made that it is just a kind of rather precious group of people who care about our historic environment. You say that, in your experience and in the work you do, people do care and do want to protect.

Mr Chetwyn: Yes, absolutely and that includes businesses as well

Q45 Christine Russell: Can I ask you about your members because some of the submissions that we received in fact were rather critical - I put it kindly like that - of the calibre of local authority conservation officers.

Mr Booth: I have heard a lot of third-hand anecdote on this kind of thing and I can tell you that no complaint has ever been addressed directly to the Institute. That quite surprises me but I am ready to investigate any complaints.

Q46 Christine Russell: The complaints we have are that there is a lack of awareness of the real world and you want to preserve everything at all costs - those are the main criticisms - and that you are standing in the way of good redevelopment schemes.

Mr Booth: We have a problem that there is a very low level of recruitment for conservation officers. We, in partnership with English Heritage, did a survey of local authorities conservation provision in 2002/03 and, yes, 85 per cent of local authorities had some expertise but, in five per cent of those authorities, that expertise is fractional, ie less than one person. So, under-resourcing is a huge problem. If I were to tell you that the City of Chichester has no conservation officer, you would probably be as scandalised as I am. We have a resource problem.

Q47 Christine Russell: Is that because young people are just not attracted into the profession because it is such lousy wages?

Mr Booth: Quite possibly, yes.

Q48 Christine Russell: Rather than the status.

Mr Booth: You might say that the whole of town planning is suffering to some extent from lack of charisma perhaps compared with other opportunities in life. I certainly have not pushed my daughter into it. Yes, you could say that.

Mr Chetwyn: If I could add that there are a number of conservation officers and a number of planners involved in conservation who are actually involved in regeneration. The team I work for, which deals with design and conservation, is actually part of the Directorate of Regeneration in the Community. Much of what we do is proactive work, putting together funding packages, helping local developers, local businesses and people like that to actually take their schemes and projects forward. I think we should not get the view that conservation officers are purely about a policing role. There is also that proactive side. That needs real realism and real awareness of what local markets will take. Also, on the other side, on the development control side, it depends on the developer. You get very, very aware developers, very good developers; they come forward with the right professional teams, and it is often not really a problem going through the planning process. You get someone who is employing kitchen table designs, the sort of cheap sort of design firm, and you do run into difficulties there and inevitably the planning process there is to make sure that people take account of the external impacts of their development including other businesses and other developers. Some people are not going to like that ever, I think.

Q49 Christine Russell: So, we should view conservation officers as cherished endangered species rather than obstacles to development in historical areas?

Mr Chetwyn: Well, I just think that they are often more proactive and the sort of tank-top wearing stereotype often does not have a lot to do with reality.

Q50 Christine Russell: Could I just get a view from the Civic Trust on local authority conservation officers. I know that you work with them very closely.

Mr Bacon: I think they are very hard-pressed individuals, by and large, and that they are doing a pretty good job in a pretty bad environment.

Q51 Christine Russell: Why do you say that? Do you say that because they are not valued by local authorities?

Mr Bacon: Because they are suffering from the lack of forward thinking that is in the planning system. We run our planning systems in this country on the basis of development control rather than the local planned forward plans and that is what thrust the development industry who see opportunities for investment and change in the planning system is not up to date. So, what happens is that they come in with their proposals and often the conservation officer is the last one between them and a duty to look after the historic environment. So, they get lumbered with the whole problem. I think that sometimes they are unfairly challenged in that respect. In a former existence, I spent nine years as a city town director at Canterbury City Council and I can you that my conservation officers actually got the private sector out of a lot of holes of buildings that they had actually purchased without doing the proper survey work. So, there is another story to be told on this as well.

Q52 Mr Clelland: Can I go back to something Mr Bacon said a few moments ago when he was referring to community groups and I think I heard him right when he said that they do not how the money machine works.

Mr Bacon: Yes.

Q53 Mr Clelland: Also, in evidence, the Civic Trust have said, "Many local groups are anxious to save and restore historic buildings but cannot compete with professional, financial and development interests." Mr Bacon, could you perhaps say how community groups could play a greater part with the benefit of additional funding and how such funding could be made more accessible to community groups.

Mr Bacon: There is a range of funds for community and groups like the Civic Trust and civic societies. English Heritage and the Heritage Lottery Fund provide some funding for voluntary community groups and both recognise in their funding the value of volunteers as value in kind in assessing grant claims. English Heritage's funding sources are very, very limited, very limited indeed, and one is hard pressed to get hold of them at the local level. The Heritage Lottery Fund is very project orientated, so you have to have a project in order to get the money for the infrastructure. It seems to me that what we could be looking at is more sustained further funding for certain voluntary groups in areas where we know through the development planning process or through RDA work or something that there is going to be a 15/20 year project of regeneration of some size and those groups could be supported in their infrastructure in order that they can make the considerable contribution that they can make through their knowledge and their understanding of how services join up at particular local level.

Q54 Mr Clelland: Where will that sustained funding come from?

Mr Bacon: I think it has to come from the public and private agencies involved in development. One would be surprised at what civic society and voluntary groups exist on in their budgets. I have been to the AGM and some of these bodies have £2,000 a year and they run the whole of their advocacy service and the work they do on that, so we are talking about very small sums of money. I just think that it needs a willingness of people to say, "Right, we do think you are valued, we do think that you have something to say. Can we get round a table and share with you our constraints as a developer from the funding regimes that are affecting us from the city in order that you understand our constraints as well as we understand yours" and then get that dialogue going forward. I think it is very important and that not enough of that takes place.

Q55 Chairman: Mr Bacon, you refer in your evidence to the Shimizu judgment where it is possible to very much take the middle of the building out and just keep the façade. If a building is unlisted and it has townscape value, why is façadism wrong in that circumstance?

Mr Bacon: I will ask my colleagues on my right-hand side to deal with that if I may, Chairman, because we have talked about this before and they know more about this judgment in practice than I do.

Mr Booth: I would say that Shimizu is not just about coring out an historic building, it is about the definition of what is partial demolition and that does not just mean behind a retained façade. Façadism, to answer your question, is the problem because, if a building is worth keeping, it is worth keeping for its meaning: the front informs the back and the back informs the front, so to speak. Our concern is more about the erosion of character of conservation areas and the lack of control over that, and Shimizu takes away one of the planks that was available to local authorities in controlling partial demolition.

Q56 Chairman: If you want to preserve the identity that the façade contributes and enable the interior to be applied for modern usage, whether that be disabled access or air-conditioning for new technology or whatever, then surely the inside is more important in what it can be applied to now than its historical value.

Mr Booth: Certainly if the interior were hugely important, then perhaps the building would be listed and a whole set of other considerations would apply. We are interested in flexibility in the reuse of buildings, particularly those that are not listed but make a contribution to the character of a conservation area, but I come back to the point that it is not just this coring out that Shimizu addressed.

Q57 Chairman: So, you do not see this as an excessively preservationist perspective?

Mr Booth: To resist Shimizu?

Q58 Chairman: Yes.

Mr Booth: No, I do not.

Mr Chetwyn: I think that a half-demolished building in the middle of an area can do a lot to harm confidence in that area. This basically allows a lot of damage to the external townscape to be done. I think that is why it is important to address Shimizu.

Q59 Christine Russell: Mr Bacon, I have just been pondering further on your reply to my earlier question. You made what I thought was a very interesting comment about the lack of forward thinking in local authority planning departments. My question to you is, do you feel that the measures contained in the new Planning and Compulsory Purchase Bill will have any influence whatsoever perhaps on changing attitudes and priorities in local authority planning departments?

Mr Bacon: Speaking bluntly, no. I think the issue, as here, is about resources, skills and working together. The Trust's view is that the current planning system has been made to work better with extra skills and resources. We do not need the changes that are going through.

Q60 Christine Russell: So, the resources are needed to, I assume, employ more planners.

Mr Bacon: That is right and also raise the status ---

Q61 Christine Russell: How would this improve the skills?

Mr Bacon: Basically, we have lost a lot of the strategic planners; they have gone out of the profession because we have just become essentially a development control planning system.

Q62 Christine Russell: Where they have gone to?

Mr Bacon: They have retired or they have gone to work for regeneration agencies or housing associations or, as in my case, they left to become a chief executive of a local authority. They became so fed up with working in the planning system that any other job would do, actually.

Q63 Chairman: Mr Bacon, you referred to the use of section 106 resources to permit public realm improvements. We understand that the relevant circular already permits this. Was there something perhaps briefly that you had in mind that we had not understood?

Mr Bacon: No, not really but I do think it is very important in regeneration areas to have a strategy for the whole of the public realm in which these buildings are fixed, so that in fact you can then allocate to particular buildings the contribution you actually want up at the head before these buildings are bought in the marketplace and so on and so forth. So, again, getting back to the point that was made from the big cities, certainty is what the development industry likes and I think that if you have a very up-front public realm strategy costed out, then developers know what they are going to pay and usually, once they know what they are going to pay, they have the certainty and they cough up.

Chairman: Thank you, that is helpful. Can I thank you all for your evidence this afternoon.

Memoranda submitted by Urban Splash, Grosvenor Ltd

Witnesses: Mr Tom Bloxham MBE, Chairman, Urban Splash; Mr Nigel Hughes, Planning and Estate Director, Grosvenor Ltd, and Ms Sylvie Pierce, Managing Director, Capital and Provident Regeneration, examined.

Q64 Chairman: Good afternoon. Would you be so kind as to state your names for the record, please.

Mr Hughes: I am Nigel Hughes, Planning and Estate Director for Grosvenor Ltd.

Ms Pierce: Sylvie Pierce, Managing Director of Capital and Provident Regeneration.

Mr Bloxham: Tom Bloxham, Chairman of Urban Splash.

Q65 Chairman: We have had your written submissions; do any of you feel the need to make any further statements before we move to questions?

Ms Pierce: No, thank you.

Q66 Christine Russell: Can I ask a very simple and straightforward question which is, what do you value as developers from heritage projects? How important are they to you? What are the problems in achieving regeneration that involves listed buildings or historic buildings?

Mr Bloxham: The value of it is simply about the quality of the buildings and what attracts us as developers to historic buildings of whatever age is that we believe there is something in them of great quality, no matter how old they are, and that it is therefore worth trying to save them. Very often, they are looked upon as not having some quality. Clearly, in places like Oxford and Cambridge, we are very familiar with what we see as the historic environment and everybody likes it. In other towns and cities, the mills in Oldham are much less widely appreciated but they are still very, very important. The problems with it are not a general desire from the local authority to see them put back into use and almost universally you get cooperation and you get a desire to see them come back into use, but the actual practical workings of the process through it can be extremely problematic, time consuming and expensive.

Ms Pierce: Historic buildings are often in the heart of regeneration areas. I work only in London, so my experience is only London based and we specialise in regeneration in public sector partnerships, so a lot of the buildings we work on are originally in public sector ownership and in economically deprived areas. So, those buildings are very loved in the community. I think it is actually fascinating how much local people do feel ownership of old schools, old libraries, old town halls, things that are part of their heritage. I think, if sensitively done and with a good architect, you can come up with wonderful reuses of those buildings and what it is about is actually bringing these buildings that have had one use in a community, giving it new uses that have a resonance with the local community but also make money for everybody, or at least hit the bottom line for everybody. Many of the problems have been spoken about but I would list them as a sort of, in my view, very old-fashioned antagonism between the public and the private sector which I think is a real pity. I came from the public sector into the private sector and, if I had known then what I know now, if you know what I mean, I would have done it all rather differently! I think that that is a real problem and I think that is a lot to do with competence on the public sector side. I think there are problems in relation to the way in which local authority planners sometimes, and conservation officers, deal with developers. I think a lot of developers are, if you will forgive me saying so, rather conservative in their approach. They see historic buildings as a problem, a problem because you cannot manage costs so easily, a problem because they think they will have problems with English Heritage or with the local conservation officer, and I think that, as an industry, we have not always been smart about the way that we have interacted with local people or, if you like, given full weight to the kind of values that the public sector bring and have tended to focus on criticisms of public sector rather than, if you like, trying to bring the good things about the private sector out which, in my view, are very good risk management and decision making and kind of aligning that with what seem to me to be public sector values which are about valuing the local community and understanding the local community. If you could bring those together, maybe you would have something that was better than the sum of the parts.

Mr Hughes: I think we value the challenge that Grosvenor specialises in, the inner city area and perhaps more well known in London which is where I have done the work rather than in Liverpool, but it is a challenge. We see it very much as a community rather than just as the buildings. The problems have already been covered but it is the uncertainty particularly in terms of the risk, the type of the building, the future use and the planning issues. There are lots of problems but we enjoy it.

Q67 Christine Russell: In your submission, you were really questioning the viability of some of the schemes. Have Grosvenor rejected any schemes recently on the grounds that they are just not viable because there are far too many historic buildings that need to be maintained as part of the scheme?

Mr Hughes: Historic buildings, by their nature, are more expensive to deal with. I cannot think of anywhere where we have said, "No, we won't deal with it", but it is always a long struggle to get the right things for it and for the approved alterations to make that building a viable proposition.

Q68 Christine Russell: Tom, can I ask you to elaborate a little on words in your submission where you describe some developers as carefree, even criminal in their approach to listed buildings. Why do you say that?

Mr Bloxham: There are numerous examples of buildings mysteriously exploding when they cannot get planning permission for them and even more numerous examples of people owning listed buildings and simply leaving them, either taking the slates off the roof or leaving them to actually deteriorate and very rarely does anything ever happen about these.

Q69 Christine Russell: In your experience, do you feel that local authorities should perhaps be a little more responsive to the needs of listed buildings and actually use what powers they do have to try to safeguard them?

Mr Bloxham: Absolutely and, what is more, be much more proactive. We have been in situations where we have taken on ... Can I take for example in Ancoats(?) where we are the first developers to come in to take on a very important series of old historic mills. We were delayed for months, even years, arguing about the mortar mix, what it should be in the mortar, while, next door, buildings are falling down and nothing happens to people who own them.

Q70 Christine Russell: Who were you having that dialogue with?

Mr Bloxham: Again, with a listed building, conservation officers, listed building consents, the reality of the matter is that where you have buildings, particularly buildings of interest and importance, you almost get an auction, in our experience, between different conservation bodies who are all being consulted with and offering their advice in a very well-meaning way. The Victorian Society, the Georgian Society and local history associations - many of these people simply want to see no change to buildings and want to see buildings restored to exactly as they were even now or when they were first built.

Q71 Mr Cummings: Perhaps you could advise the Committee as to how important the availability of grant aid or fiscal incentives to developers is in order to take their interest towards redevelopment and improvement of historic buildings?

Mr Bloxham: I have two things to say in answer to that question. One is that it is not a level playing field; it is by and large quicker, cheaper, easy and certainly much more certain to build a new build than to convert a difficult old building. Most of the buildings that we consider to be a risk, more importantly, have actually lain empty for a long time and there is no beneficial occupation of them for a variety of different reasons. Almost by definition then, if there were an easy solution, someone would have done it before. They are lying now empty and, quite often, if you want something to happen with these buildings and if, as a nation, we believe they are worth keeping, we have to level our playing field and have some form of fiscal incentives to encourage developers to redevelop the more difficult buildings.

Q72 Chairman: Can I ask the other witnesses to add something only if they feel they need to add something new to that.

Ms Pierce: Obviously, it depends on land values in the area and I think the way in which you work with local people and local planners. I suspect that, in London, it is easier because, even in places like Hackney where I do a lot of work and Lambeth, land values are relatively high. We have not had any grant aid in any of our schemes, although I would add that sometimes the public sector partners have then gone separately and got some grant aid for themselves to help whatever venture they wanted to put in the building. It seems to me that we have kind of set the stage that has enabled them to do that because they have a building that they can then use, but we have done it all as private members.

Mr Hughes: I think it is probably a question of disincentives as much as incentives on the fiscal side. Our concern is section 106 agreements, possible planning tariffs and other obligations that are part of the package.

Q73 Mr Cummings: Urban Splash states in their evidence that VAT should be recoverable for refurbishment and improvement work to historic buildings and that some other fiscal incentives should be introduced, and you give the example that capital allowance should be used to encourage reuse of historic buildings. What other fiscal incentives do you have in mind?

Mr Bloxham: I am sure that a lot of people cleverer than I could say them but, some form of capital allowances, rates reductions, help in doing the externals, ease through the planning process and maybe there should be a presumption that the whole process should be quicker with historic buildings. I think a whole series of different measures could be used to encourage developers to bring forward historic buildings.

Q74 Mr Clelland: I think it would be helpful to the Committee if the witnesses were to put on record their description of the financial risks associated with work done on historic buildings and in conservation areas.

Mr Hughes: The principal financial risk is in terms of the cost of dealing with a listed building or historic building, the uncertainties that you only find once you start to do the building work. The other risks are in terms of the amount of money you have to put up front for the planning negotiations. One of the local authorities that we deal with, you now have to pay for a pre-planning application meeting before you then start to pay for the planning application itself and the amount of information that is required at the planning application stage involves a myriad of consultants that you would not necessarily always employ. Where historic buildings are concerned, also we have had a requirement to do detailed planning application for those historic buildings as part of the master-planning and again it is additional expense but also you are perhaps tying yourselves to something which you may want to reconsider at a later stage once you have completed your master-planning exercise.

Ms Pierce: I would agree with all that. I would also add that one borough we are working with does not have pre-application meetings at all. So, if you are dealing with a listed building and you have to put in a detailed planning application, they do not give you any meetings, so you are working completely in the dark and at risk. There is also the issue of planning use because, especially if you are working in buildings that have been in the public sector, they usually have a B1 use and therefore not being able to speak to the planners is pretty difficult. The last thing I would add is that one of the things I have talked about in my evidence is, if you like, the split between conservation officers and English Heritage and we have certainly had experience of having very good support from English Heritage but much less good support from a local conservation officer.

Mr Bloxham: It will always cost more than you think and take longer than you think with an old building - you can rely on that one - and then just the bureaucracy and the amount of detail and plans which you have to go through to actually get the consents.

Q75 Chairman: What scale are we talking about? What is the size of this risk against the overall cost of the project?

Mr Bloxham: For us, if we are doing a £10 million projects if it is in a conservation area or a listed building, it will cost us probably hundreds of thousands of pounds, certainly tens, extra in fees and probably delay the process by six to 12 months.

Q76 Chairman: What is the difference in delay comparative to a new build? Was that the difference in the costs that you were describing?

Mr Bloxham: Yes, the difference in the costs.

Q77 Mr Clelland: I suppose that another complication in this area on historic sites is the different regulatory regimes: conservation areas, listed buildings, scheduled monuments and other archaeological features. How does the existence of several regimes affect regeneration projects in which you have been involved?

Mr Bloxham: It certainly does not make them more easier and more helpful. I suppose that, in a way, we get and I will not say jaundiced about it because a historic environment is very, very important, so let us keep all this in perspective, but we know that we have to get an architectural survey done, you are going to have claims for new construction because you are going to have researchers in there photographing and digging up buildings and, with almost all the buildings, you do photographic records. The thing that we find most difficult is this hierarchical almost auction that goes on. When you are putting consent through with different interested parties; they are all very well intentioned but they are all putting pressure on the conservation officer to actually accept their point and you need a very strong conservation officer who actually says, "No, this is what is important about the building. We must keep this. The other parts are actually not vital and, for the sake of redevelopment and saving the building, let's give on those but keep that one."

Ms Pierce: I would agree with that and I would just like to give an example. We are doing a scheme in a London borough which is a mixture of new build and refurbishment of a listed building. We try to be proactive and go and talk to as many of the bodies that are involved as possible. We could not speak to the conservation officer because he does not do pre-application meetings, but we did talk to the Civic Society, local organisations and English Heritage and we received fantastic support and we chose what we thought were really exciting architects. We did all that work and then found that there was a kind of dispute in the heart of the borough because actually the conservation officer had a completely different view, and it did not matter how many letters of support we had because, in the end, we put a lot of money into working with people we thought were giving good professional advice on heritage only to fall when we finally got to speak to the planners. So, you can do your very best but actually, because the regimes do not coalesce, you only have to upset one person who has quite a lot of power and it can undo all your good work.

Q78 Chairman: Are you happy with those answers, Mr Hughes?

Mr Hughes: Yes, I am happy with those.

Mr Clelland: I did not hear any simply solutions to it.

Q79 Christine Russell: Can I follow that up a bit more because, Tom, you have been very critical of - I am not quite sure how to describe them - the purist amenity groups who you feel get in the way of regenerating historic schemes and, Sylvie, you have just told us of your experiences with a local authority and its conservation officer. Can I ask all three of you about your experiences with English Heritage. In the main, do you find officers from English Heritage a help or a hindrance?

Mr Hughes: We have a good relationship with English Heritage and we have carried out a number of joint studies with them. One of them was comparing the value of historic buildings with new buildings which was done about ten years ago, and it was partly as a result of that that English Heritage employed an investment adviser to cover what was covered in one of the previous sessions in terms of the professional property advice which we felt that Heritage, in particular, at that time lacked and which I think Westminster and other local authorities still perhaps lack.

Q80 Christine Russell: Have you experienced awkward situations where perhaps English Heritage have agreed with your plans but then the local authority has said, "But we don't like them"? Have you experienced differences of opinion between them?

Mr Hughes: There have been differences of opinion but it is more often a difference of opinion between the officers and the members and the councillors. Very often, we will get the officers on board because it complies with them but we have problems with the members.

Q81 Christine Russell: Who are reflecting the views of local people?

Mr Hughes: Not necessarily. They might be reflecting their own views.

Ms Pierce: My experience with English Heritage has been very positive and, as I have said, less positive at the local authority level and my observation would be that English Heritage has changed and has embraced much more, if you like, the kind of end product - how do we use our historic heritage to kind of bring it to new uses and to maybe blend it with modern architecture mixed with particularly Victorian and Edwardian architecture? I think they have become quite bold and brave about that. I suspect that is to do with confidence and professionalism. If I were to be generous towards conservation officers, I do think that they are often very isolated, they are not well supported internally, they do not appear to get a lot of professional development and they are not kind of loved and cared for, and they are part of planning and planners have been kind of beaten up over the years. So, what you get is a sort of obsession with the old because at least that is something you can hold on to.

Q82 Christine Russell: And they are ultra-conservative in their views?

Ms Pierce: In my experience they are, yes.

Mr Bloxham: I think the answer is that English Heritage is improving dramatically and I think particularly at high level - it is very good now and they embrace change. I think they are handicapped by two things: the whole listing system - if the building is listed, the whole building is listed and you cannot change anything by statute at all. Secondly, a number of people have worked in English Heritage for a long time and, like any organisation, it takes time for that change to filter through.

Q83 Christine Russell: Have you ever experienced a conflict of views between regional officers of English Heritage with national policy pursued by English Heritage?

Mr Bloxham: The more usual conflict is between junior officers and more senior officers and a purely conservation-led approach. I think that we have to be very careful with buildings. If I owned a Turner picture or a great work of art, I can do what I want with it: I can throw it away, I can bin it. It is always uniquely with buildings that actually, by statute, you cannot alter your own property. I think that again, as a nation, if there are buildings that are so important - and we have many buildings that should not be touched - we also have an obligation as a nation to look after those and protect those and I think it is unfair and dishonest to say, "Actually, you cannot touch this building at all by statute, yet you still have to look after it and cannot make a use of it." We have to be very clear as a nation whether we are going to pay for keeping it as a museum piece or find new uses for it.

Chairman: I do not think that is unique in public policy, but there we are.

Q84 Mr Clelland: What are the attitudes of the big institutional funders like pension schemes to heritage-led regeneration projects?

Mr Hughes: Our silence probably says it all! I cannot really comment on that one, I am afraid.

Mr Bloxham: My own experience is that people have always used finance as a reason why things do not happen. My experience in a number of different businesses is that actually finance has never been an issue and I think that, if you have a good scheme which stacks up, the financial institutions do not care an iota whether it is a brand-new building or whether it is a historic building, they simply need to see demonstration of the returns and all they are interested in are the financial returns.

Q85 Chairman: So you will not get property funds shying away from historic buildings because of the cost of maintaining the windows compared with putting sealed units in?

Mr Bloxham: No, it is not that simple. We are funded by major financial institutions and I think the right product is out there if funding can be found for it.

Q86 Mr Cummings: This question is for Capital and Provident Regeneration. In your evidence, you stress your commitment to the use of leading architectural practices. Can you tell the Committee what commercial benefits the use of such practices has brought.

Ms Pierce: Can I talk about general benefits as well as commercial benefits?

Q87 Mr Cummings: Yes.

Ms Pierce: I think that historic buildings often need a real skill in thinking about bringing them into modern usage. A number of the buildings that we are doing have multiple uses in them because we work in partnership with the public sector. I found the skills of an outstanding architect to be absolutely indispensable. We are just finishing a building in Hackney which I think is really beautiful and it has a multitude of uses in it and, if we had not had those architects, we would have probably ended up with a very insensitive development. In commercial terms, what, if you like, the leading architects are often very good at is getting a lot of uses out of a building, so they are able to work with the grain of the building to produce something really outstanding.

Q88 Mr Cummings: And the commercial benefits?

Ms Pierce: Part of my point is that, by being able to get a lot of uses out of the building, you are probably going to be able to make the building work commercially because certainly a lot of our buildings have very high footfall going into them and you have to be able to make all the servicing work, you have to make all the access ... Just the fire strategies in these buildings is absolutely mind numbing. So, I think having an architect who can really deliver complex design has worked very well for us.

Q89 Mr Cummings: Have you every heard of the so-called trophy architects who might be engaged to secure planning permission in sensitive locations who are then dropped in favour of design and build contractors?

Ms Pierce: I have heard of that but I would like to absolutely assure you that we never do that.

Q90 Mr Cummings: I am not suggesting that you do. What I am saying is, is there a danger that the so-called trophy architects might be engaged in many projects and what might be the consequences of this practice? What can local authorities and local governments do to prevent it?

Ms Pierce: I think that is very difficult, is it not?

Q91 Mr Cummings: I really do not know. I was a coalminer! I am not an architect or a builder.

Ms Pierce: I was a chief executive of a local authority. I think that if you engage an architect simply to get a planning consent ... Clearly, there is nothing that the local authority can do about it because they have given their planning consent and then you bring in a tenth-rate architect to finish the scheme. If you were, as I am, in partnership with the public sector, they would never work with you again. Your reputation is as good as your last scheme. So, to do that for me would be to really shoot myself in the foot.

Q92 Chairman: So, the risk is to the trophy in putting his or her reputation on the line.

Ms Pierce: Absolutely. It seems to me that a partnership is about being very honest and about building trust and part of that is about saying, "This is the architect we are bringing in. You are going to get a fantastic building and we will see that to completion." Otherwise, they are not going to work with me again.

Q93 Mr Cummings: Do the other two witnesses have any comments to make?

Mr Hughes: There are developers who use trophy architects and I would say that we are not one either.

Q94 Mr Cummings: Can you tell us anyone who is?

Mr Bloxham: It depends if you mean, by using trophy architects, using good architects or famous architects and I think absolutely and that you have really hit the crux of the problem. If you want to save the built environment, it is all about having quality design, quality architects and quality buildings. You can stop people changing the architects half-way through by very, very carefully planning permissions which do not allow any changes without going back and clearly, if someone comes back in and does not change a single thing, then you do not mind them changing architects but, by definition, they make have the intention of sacking the trophy architect to water down the scheme. So, that can be done if the planning authority thinks about it and prejudges it. Much more importantly, I think, is the whole planning process. The planning process does not give sufficient regard to good design, in my opinion. The planning process is still based on use classes which was very appropriate 100 years ago with smokestack industries. Now, what difference does it make if a building is a hotel or an office or residential, and most of the antisocial issues can be dealt with and environmental health pollution and much, much more emphasis should be put on design and, again, good designers should be able to get planning permission more easily.

Q95 Chairman: Does that not contradict what you said earlier about it being the freedom of the individual owner to do what they want with a building?

Mr Bloxham: No. With regard to the freedom to do whatever they went, when you actually go through the planning process, if you have two different planning schemes, one with a better design and one with a worst design, the one with the better design should get planning permission more easily than the one with the worst design.

Q96 Christine Russell: I was going to ask you a question about that. I was going to ask you whether, in your view and in your practical experience, planning officers - and I suppose one should say planning authorities because it is members as well as officers - are just too inflexible about the reuse of historic buildings. It would be interesting to know from your own experiences whether you have had an important historic building and you have had a vision that this could be used for a new purpose but the planners have said, "Oh, no, it has to be converted or reused as this" and how you got round it.

Mr Bloxham: It is not so much the change of use per se, I think that only comes an issue in parts of London where economic use has become residential. The issue is more like, we believe that, to be able to let a building, we need to have a big atrium going through there so that there is a stunning entrance space, whereas typically old mills were for workers who were treated very badly and did not have any big stunning space. So, it is these sorts of material changes inside a building and then having an argument over those. The quality of the design comes unfortunately very low down and is much harder and you need more confident planners and more confident planning authorities to be able to say, "Yes, we will give them this one because it is a good design" and it is much easier to say, "Actually, no, it is a listed building and you cannot change anything, but you are changing this and this", and so it is difficult.

Q97 Christine Russell: I was just looking at Grosvenor to see if they have encountered problems with trying to get change of use for historic buildings.

Mr Hughes: Yes, we have and also in terms of bringing buildings up to standard, for instance strengthening floors within a listed building to take off as floor loadings. We have had a "no" to that which severely limits what a building can be used for.

Chairman: Thank you for your excellent contributions and for taking the time to come and give evidence.