Greater Manchester Centre for Voluntary Organisation

Report: Half of physical regeneration projects have underperformed

Regeneration strategies that attempted to boost cities by building new housing in deprived areas failed because they were not able to counter market forces that were pushing people away from those places.

Research by think-tank the Centre for Cities says that, over the past ten years, the Government’s approach to city regeneration – which has focussed on stimulating economic growth by clearing up dereliction and building more housing and offices in its place – has largely failed to turn around local economies or the lives of residents.

Among the report's main claims:

- almost half of large-scale physical regeneration projects in England over the past decade underperformed
- the average underperforming project generated 40 per cent fewer jobs than anticipated when the scheme was first planned
- vacant housing in these areas has often remained empty, while office space is often difficult to let

According to the report, such office space is difficult to let because many projects have been battling against long-term economic forces such as industrial decline and suburbanisation that have caused population and job opportunities in many urban areas to shrink.

Such a "going for growth" philosophy is therefore unrealistic in many cities across the country and a new strategy is "urgently" needed, the report says.

It argues that a more productive approach would be to build parks and improve green space in low-demand areas, or turn derelict, tiny terraces into larger homes rather than knocking them down and building one-bed flats.

The report says: "Against a backdrop of low demand in some city-regions and/or neighbourhoods, policy makers should question why the public sector has been targeting an increase in the supply of housing and commercial property in these areas – especially given that the available evidence suggests that these interventions have not had a transformative impact on the economic outcomes achieved by people living in these areas."

The report calls on the coalition Government to introduce a "transformation fund" in the next spending review to help cities introduce projects that improve the quality of life in neighbourhoods undergoing industrial and population decline.

It also urges the Government to find new money to enable the previous Labour administration’s Housing Market Renewal Pathfinder programme to be completed.

Centre for Cities chief executive Alexandra Jones said: "The coalition is encouraging all urban areas to 'go for growth' through incentives like the New Homes Bonus [to encourage local authorities to build more social housing]. However, the neighbourhoods grappling with industrial decline and the impacts of recession and cuts need to stabilise first.

"Shifting plans from building a science park to creating a public park in these places is not about giving up on growth. It’s about improving the area for local residents. Ambition and innovation from city leadership are the key ingredients."