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Agenda item 3 is an evidence-taking session for our inquiry into the delivery of regeneration in Scotland. On Monday last week, committee members undertook two more community fact-finding visits as part of the inquiry. That brings to six the number of fact-finding visits that we have undertaken around Scotland during that work, and I estimate that we have now engaged directly with nearly 200 local community representatives since we began our inquiry in January.
Thank you very much. Clyde Gateway is keen to contribute to your inquiry. Over the past few sessions, you have heard from a number of witnesses who have represented Clyde Gateway, although you may not have realised it. Councillor Chris Thompson, our vice chair, was here recently. Brendan Rooney, from the Healthy n Happy Community Development Trust, and Jimmy McLellan, one of our community representatives, have also been here.
Thank you, Mr Manson. Please give our regards to everyone in your organisation, particularly wee Jimmy, who we thought was an amazing witness.
We were born into the storm. Clyde Gateway was created in 2008 so, from the very beginning, our tactics, strategy and operating plans were amended to take into account the poor market conditions. As you would expect, previous assumptions about values, joint ventures and the state of the private sector market were altered from day 1. The tactics that Clyde Gateway adopted at that time were to identify early projects to ensure that there were early wins, as it was going to be even more difficult to do that than it was before, and to get early action on the ground in the face of what we knew was a crisis. We also tried to have a number of market opportunities ready. At that time, it was difficult to guess which aspects of the market were going to come back or develop, so we put a range of opportunities out into the market.
You were born during the beginning of the downturn. Were your targets, therefore, initially much more realistic?
The targets were set in a business planning process over 2006 and 2007. You could easily question whether the targets were still realistic, given the changed economic circumstances. However, the key thing to remember about Clyde Gateway is that it is a 20-year commitment. Those targets will be met because the fundamentals are there. There is the room, the land and—when we have finished—the infrastructure to accommodate that level of investment and those outcomes. We feel that, over that 20-year period, it is right to stick to those targets and they are still realistic in our view.
Okay. We may come back to that.
We were born at a different time from our colleagues. Our initial business plan was for the period from 2003 to 2010, so we were on both sides of the fence and experienced both the good times and the deteriorating times. We refreshed our business plan in 2010 and very much took account of the wider circumstances. As a result, we pared back some of our targets for the creation of business space and certain jobs targets. For example, we had identified that, in the period to 2010, we would like to achieve something of the order of 14,400m2 of business space in our area. However, the reality was that by 2010 we had achieved 5,700m2 and we decided that, in the planned period from 2010 to 2016, we would only marginally increase the cumulative target to 15,550m2. We had initially hoped to achieve 420 construction jobs, but by 2010 we had achieved 65. Again we pared things back and the cumulative target for 2016 for construction-related jobs is now 139.
Having been born at the end of the last significant period of growth, we have significantly changed our business plan over the past few years; indeed, our submission contains a diagram that shows the number of iterations that we have been through. We have responded in a number of ways. First of all, we have of course taken account of the recession’s impact, particularly on commercial development and private sector investment. We have also taken account of the squeeze on public finances and have pared back some of the original ambitions in our business plan with regard to the level of funding that we could secure from the public sector, because we realise that such ambitions are not appropriate and that the funding is not available.
When PARC Craigmillar developed its business plan’s goals and objectives over 2003, 2004 and 2005, the economic circumstances were buoyant and the view was that, by 2007, 2008 or 2009, the whole enterprise would effectively be self-sufficient and proceeding on the basis of the profitability of the previous investment and normal bank lending to the private sector. However, by late 2008, there were very limited if any profits to be made from development and bank lending had disappeared, which meant that the two fundamental features of the second phase of PARC regeneration were not in place. From 2009 on, we were unable to pursue our original objectives at any pace and, by the end of 2009, the company was technically insolvent; its liabilities exceeded its assets; and, like many private sector development companies at the time, we were in survival mode with a question mark over whether survival was possible.
Before I move to questions from colleagues, I want to ask about the figures on the fifth page of the submission from Irvine Bay Regeneration Company. The submission suggests that £0.5 billion of gross value added has been secured so far. Can the other organisations give us an indication of where they are at in that regard? Mr Manson?
Sorry, let me make a slight correction. Actually, the amount secured is not that high, but we believe that our work can lead to that level of GVA. If the table in the submission is slightly confusing, I apologise.
How much GVA has been secured thus far?
We have secured £7 million thus far.
And how much public money has been invested?
The public money invested is £33 million.
So £33 million of public money has been invested, and thus far the GVA is £7 million.
Yes. We believe that the projects that we are working on will generate substantially more. At the moment, we are putting in place the infrastructure that will lead to the private sector investment, which will lead to the GVA. That is why the figures in the table show the amount that has been secured and the amount that will be secured on the back of the work that we have commenced. For example, the enterprise area will lead to very significant amounts of GVA and is already beginning to do so.
Okay. Mr Manson?
GVA predictions form part of the business planning process for Clyde Gateway. The expected GVA was part of the outcome from the expected investment. We use GVA predictions on a project-by-project basis to decide whether a project will provide good value going forward, but we have not calculated GVA outcomes cumulatively for our projects. We would be happy to do that, but we do not have such an indicator available at the moment.
The committee would be very interested in seeing that. Obviously, if you are doing that for individual projects, I imagine that it would be quite easy to add it all up. Mr Robertson?
Like Mr Manson, I do not have those figures immediately to hand. The intention was that the issue would be clarified towards the end of the business plan, which would have been 2016. After the up-front investment from the urban regeneration company and partners goes in and gets things moving, the private sector investment should be attracted in thereafter. That is when we believe the appropriate time is to measure GVA. Like Mr Manson, if the committee is looking for further details, I would be happy to look into that.
The committee most certainly is looking for further details. We would be grateful if you could pass that information on to the clerks.
Similarly, we have not been using GVA as a particular measure. Equivalent figures that we have suggest that, for £26 million of grant investment, we have levered in another £38 million of private sector finance.
Thank you very much.
Good morning, panel. I want to ask about community involvement. The joint submission from the west coast URCs notes:
Mr Adair, would you like to start?
You quoted from the submission from the west coast URCs, but obviously PARC Craigmillar is not included in that. We have supported the local neighbourhood partnership throughout the existence of PARC Craigmillar and we have effectively been supporting its role as a liaison with the community. We have contributed an average of £20,000 a year towards that. Our management team also contributed for a number of years by having a full-time community liaison officer.
We play a number of engagement and support roles within the community, and we have engaged in a number of specific projects. For example, we have worked with Kilwinning Community Sports Club for a number of years and have put in about £200,000, which has allowed the club to secure a £2 million investment for refurbishment of its training facilities and so on.
Curriculum for excellence.
Forgive me.
Clydebank Rebuilt obtained £196,000 for public consultation, which we took forward by establishing our own community-based group called the design forum. That has been an opportunity for community representatives to come forward and, importantly, for members of the public to attend what were, to all intents and purposes, public meetings at which they could meet Clydebank Rebuilt and understand our plans and proposals. It was important that they were able to meet our professional teams who were working on specific projects.
The community is at the heart of everything that Clyde Gateway does. A healthy community is vital to regeneration of the entire area, so the community is a key component of everything that we do. We are supporting some of the most deprived communities in Scotland; they are fragile communities that need support all the way through the process.
I want to explore your decision-making processes in the projects that you undertake. I will start by asking an obvious question, and a nodding-head answer will do, I suspect. Do you have more projects than you can do?
A yes or no will do.
I see that the answer is yes for all of you. That is money in the bank, in questioning terms.
I am happy to respond to that question. Yes—our projects are scored. They are ranked and our board makes a decision about what goes forward into the operating plan every year. We use our key performance indicators to rank them. Projects that have a major impact against our overall 20-year outcomes go forward.
It is rather awkward for me to answer the question directly because what Stewart Stevenson has suggested is a very quantitative approach to how projects are identified.
On the circumstances, if you are talking about the economic downturn, please say so. If other circumstances stopped the progression of projects, we would like to know that, too.
The problem was primarily the economic downturn.
I echo some of Ian Manson’s comments. We probably go through a three-stage process. We have not mapped it out that way, but when we undertake a fundamental review of the business plan we go through a full ranking and prioritisation process that looks at finance, outputs, risks, deliverability and environmental considerations. That gives us a long list of projects which we then passport into our annual operating plan. When we go through the operating plan we look at affordability, deliverability and the projects that we think will deliver the biggest impact and the best return.
There is no single approach that PARC Craigmillar has used; our approach has varied, depending on the phase of the overall regeneration and on the project.
You mentioned two new schools. How were they paid for?
They were paid for using a combination of Government grant and our own profitability.
Did the City of Edinburgh Council not pay for the schools?
It contributed £1 million towards a school; it also contributed the land. The vast majority—probably 95 per cent—of the land in Craigmillar is owned by the City of Edinburgh Council.
Who do they belong to now?
Some of the land belongs to the City of Edinburgh Council, but much has moved into private ownership—
I am asking about the schools.
The school is owned by the City of Edinburgh Council.
Instead of paying for the two new schools by traditional means, the City of Edinburgh Council got you to get various grants and so on, so its mainstream budgets have been bypassed. In other communities in Edinburgh it would be the norm for the council to build and pay for a new school. Is it fair to say that?
Yes, although in a strict analysis the council would probably add that it had to invest to clear the site and is still contributing the remaining land to regeneration of the area—
Therefore, it could be said that your organisation’s ability to get money from other bodies has saved the City of Edinburgh Council from using mainstream resource to build two new schools for communities in Edinburgh.
That could be said, yes.
As I expected, each of the witnesses has suggested that there are not only financial but societal considerations and returns. I think that the committee will welcome that, because we do not simply regard the issue through a financial prism.
Very briefly, gentlemen.
Strictly speaking, the answer to the question is no; there would not be just one named person. A project might have somebody who is responsible for the physical delivery, who would probably be expected to be responsible for the financial aspects, and another individual within the organisation might seek to work with the community on delivery. A range of individuals might be involved. Ultimately, though, the organisation’s board of directors would take overall responsibility for the project.
Just before we move on, would you be absolutely clear that the board sees its responsibility as being to deliver all the benefits? By the way, I absolutely accept that in individual projects there will be things that turn out not to be deliverable, although there should be a process that makes it clear what is being discarded and accepted.
I am confident that the board recognises its role and responsibilities.
Yes, but does it do so specifically in the way that I asked about?
Yes.
Right. That is fine.
We assign a dedicated project manager to each project, who is responsible for the life cycle of the project. We also have—
Can I just stop you there? That goes precisely to the nub of what I am asking. In a sense, a project differs from a responsibility in that it has a beginning, a middle and an end. A responsibility has a beginning and it endures. My experience of projects is that we get to the end and the project manager leaves the project. However, it is over the next 20 years, as Clyde Gateway suggested, that the benefits will be delivered. So, my real question is: how does the benefits cycle work?
Okay. There are probably two answers to that. First, different people might be responsible for a project at different times, so we tend to have a project development manager, who will work up the project and perhaps do the deal, put in place all the components and then procure whatever development route we will go through. We also now have an in-house project manager who does really detailed stuff in terms of project control and scope control, and looks at the range of activities that are associated with the project. In addition, we have monitoring and evaluation, so we have a monitoring report and an evaluation report. We then report back to the board on where we are with individual projects in terms not only of the delivery phase, but of the outputs.
That leaves me unclear. Whose job is on the line if the benefits that were included in the decision-making process are not delivered?
It would be my job on the line.
That is fine.
Mr Robertson?
I concur with my colleague’s view, so I have nothing to add.
Mr Stevenson has put his finger on the added value that comes from having a focused organisation that lives or dies by its record of success. The point of my organisation is that it has to produce the goods in terms of the outcome, so we are structured so that each project has a project manager who sees it all the way through.
Mr Manson, you said in response to the convener that you have not had to revise your targets in the light of the financial crash. Your key performance indicators suggest that you are broadly on track to reach your targets. Is that a fair reflection?
We are satisfied with the indicators on land remediation and job creation, but we are slightly frustrated on commercial development and house building—we would like to be further ahead on that.
I note that qualification but, in comparison with the experience elsewhere, you are closer to your targets than other regeneration companies are. Unlike other members, I have not had the chance to visit the gateway. Why are you closer to your targets? Did you learn from experience because you started later than other companies, for example?
We learned from the other pathfinder companies and we used our experience in regeneration over many years.
My final questions are more general. Your comment about taking a commonsense approach is interesting. Such projects have 10 to 20-year lifespans. In the past few years, we have had the economic crash. Will future approaches to such schemes be revised as a result, to take greater account of ups and downs in the economy?
We have reflected the opportunity that we have with the enterprise area, which has a huge capacity. We have a one-off opportunity to exploit that, so we have shifted our activity heavily to focus on it.
Does anyone want to pick up on Richard Baker’s point?
Without stating the obvious, regeneration areas are very difficult to operate in. Factors such as site conditions and the current economic circumstances in which we find ourselves have an effect. I am clear that our job as a URC is to crack on. Our work is about building confidence, making our places attractive and competitive, and getting them to the start line so that developers and investors will—when they come out to play again—very much be looking at areas such as Clydebank and the other regeneration sites.
Before we move on to Mr Wilson’s questions, I have a question for Mr Manson.
Yes—I apologise if I have not emphasised that sufficiently. The games village is a significant part of our housing target. The Emirates arena is, in business development terms, the local leisure facility that people can enjoy and use after work, and the refurbishment of Dalmarnock station has also been heavily helped by the Commonwealth games.
If the Commonwealth games investments had not come into play, where would that have put you with regard to the targets that you originally set yourself?
We would have fundamentally reviewed the targets. If the M74 had not been funded and the Commonwealth games had not been won, it is a moot point whether Clyde Gateway would have even been formed.
That is very useful, Mr Manson. We may well call on you to provide some of the information that we received on our visit with regard to the legacy in housing and so on. The clerks may write to you so that we can furnish new members of the committee with that information.
If you have left me any questions to ask, convener. You asked three questions in particular that I had written down and wanted to ask. [Laughter.]
Great minds think alike—although we will not move on to the second part of that saying.
Good morning, gentlemen. I will follow on from the convener’s question about the schools that were built in Craigmillar—or the plans to build two schools—and the current ownership of those schools. I note that Mr Adair said that 95 per cent of the land belonged to the local authority, so the schools would therefore be returned to the City of Edinburgh Council. Was there any discussion about transferring the schools to community ownership and using them as community hubs, rather than, once they have been built, simply transferring them back to the council?
I was not employed by PARC Craigmillar during the early stages of those decisions, so I do not know whether there were discussions of that nature. My understanding is that that was not part of early discussions, although I might be wrong.
I raise the question because Mr Manson said that he expects all the assets that are developed through the URC to become community-owned assets. I ask Mr Manson to define what he means by “community-owned assets”. Is it similar to what happened in Craigmillar, in that the assets that are created through the public funding that has been ploughed into the URCs will be transferred to the successor local authorities, which in Mr Manson’s case would be South Lanarkshire Council and Glasgow City Council?
That simple transfer is not possible. We are an urban regeneration company with charitable status, and any successor body has to have the same objectives. Therefore, it would not be possible to split up the portfolio in a simple way unless the successor bodies can demonstrate a continued intention to redevelop the area. There is a new situation in front of us, and it is one that I find quite exciting.
To clarify, you say that the successor organisation would need to have the same commitment to redevelop the area. Surely the objective of the URC is to have the area redeveloped in a 20-year timespan so, based on your current plans, there should be no need for further redevelopment of the area. Therefore, any successor organisation would not have the same objective of redeveloping the area, because it should have been redeveloped.
Areas change, and vacant and derelict land will be created in future. In the east end of Glasgow, there will always be further change. Perhaps “redevelop” is too strong a word, but any successor organisation would have to have the specific interests of the area at heart. I suggested that assets that are created by Clyde Gateway could be transferred in that way. The key is the attitude of the partners—Scottish Enterprise, South Lanarkshire Council and Glasgow City Council—which would have to decide how they want to proceed.
That response goes to the heart of the issue about what we mean by regeneration of an area. You talk about major infrastructure works being carried out by the URC. Should that work not be carried out by agencies other than the URC, such as local authorities and Scottish Water?
The starting point for creating URCs was to make things happen where things were not happening and to achieve targets and outcomes that were not being achieved otherwise. You can take one of two approaches to that: either you persuade every agency, every organisation and every private sector funder to change its own approach and priorities and to invest in what should happen in an area, or you create a dedicated body to achieve that aim one way or another.
That last point brings me on to the issue of match funding. I thank the URCs for the evidence that they have provided for this session, but I have to say that, when I look at the investment that has been made in areas, I see very little private sector investment, and where there is any such investment—or indeed any such anticipated investment—it has been made predominantly in house building.
Again, there are several ways of approaching the question. First, our two major housing schemes—as they might be badged—are in fact mixed development schemes. We make it very clear that we are not trying to create new housing estates and that we want a mixed development with a mixture of employment and housing opportunities. We are trying to change the housing market, but we are also looking at how we might tie in leisure opportunities such as the marina in Ardrossan and create more business space on the back of this enhanced environment. In short, these are not just housing schemes; we know that we need to look at a wider canvas than that.
One of the initial prompts in this session was about why my organisation came into existence. When several large employers in the Clydebank business park left the area, we had to focus on the need for economic infrastructure. That has been our particular priority and, in response, we have developed the kind of office space—particularly small office space and small workshops—that investors and developers would not necessarily pick up because it is not necessarily financially attractive.
We have an example of a sustainable house-building industry. Much of the kit is now made off site and, in our area, we have 50 Clyde Gateway residents working in a housing manufacturing plant. That is a green job because it ensures that the highest environmental standards can be met; it is a warm and comfortable job compared with being on a site; and, as long as the company does well, it is a long-term, sustainable job. We can, therefore, provide an example that challenges the house-building example that Mr Wilson gave.
I am looking at some of the figures. In the opening paragraph of the Irvine Bay Regeneration Company’s written submission, which is part of the performance summary, we are told:
I would like very brief answers, please, gentlemen.
Nothing in life is guaranteed. What you look at is what is in front of you. On the specific sites that we have remediated, where we have been able to attract developers and companies, the leverage is very high. Private funding is coming from institutional sources, such as Aviva, the BT pension fund and other sources, so it is possible to get such investment.
I mentioned that in all our areas we deal with very difficult sites, so there is a requirement for front loading, which will mean that there is a very high profile of public spending.
Pump-priming investment has to go in at the start of the process. We believe and are optimistic that returns will come. We are beginning to see an uplift in the level of inquiries that we get, particularly on the back of the enterprise area. If we can convert some of those inquiries into investment in jobs, the investment will arrive and returns will come, but it is a long-term process. We are dealing with deep-seated generational problems in areas where the decline has been going on for decades and we are trying to turn the situation round. We put in place the infrastructure, prepare the sites, prepare the land and put in place some of the business opportunities. We believe that we are putting our communities in the best possible position to take advantage of any economic upturn.
In the past three or four years, there has been very little private sector investment even in the centre of Edinburgh, which is clearly not in a regeneration area—only one commercial office block has been built on spec in central Edinburgh. To expect that there would have been private sector investment in a regeneration area such as Craigmillar would therefore be unreasonable, yet we are now reasonably able to expect that there will be private sector investment in retail developments in Craigmillar. As the economy in general improves, I therefore believe that the investment that has been put into the Craigmillar area will, over a number of years—it will take significantly longer than we originally envisaged—attract a significant level of private sector investment for the good of a sustainable community.
My question is for Mr Manson, Mr Robertson and Mr Wiggins. Your submission states that your business plan puts the emphasis on attracting private investment. What are you doing to keep the initial private sector jobs that you attract and to ensure that they last? My experience is that often such private sector jobs come and go. Are you doing anything to sustain them and retain them?
The private sector jobs that have come are good ones in oil and gas, and in construction. My judgment is that those are key sectors that will continue to grow, and I think that that is also Scotland’s judgment.
When the tenants in our industrial and office properties first come in, and on an on-going basis, as a matter of course, we ensure that they are aware of the services of our partner agencies. That may be the business gateway service or the economic development team at West Dunbartonshire Council or, particularly for fast-growing companies, there may be support available from Scottish Enterprise with regard to account management. It is very much the case that we speak to them when they come in to reinforce that there may be a range of business support mechanisms, including support in taking on local people.
A lot of the investment that we have received so far has been from good-quality local companies that have a long-standing relationship with the area and an on-going relationship with the communities and the people whom they employ, so we are confident that they will be there for the duration. We also work very closely with North Ayrshire Council and Scottish Enterprise to ensure that there is aftercare and that the business support mechanisms are in place.
Good morning, gentlemen. I have a couple of questions. On page 4 of the joint submission, regarding Riverside Inverclyde, there is a reference to an MSP being an ambassador for the Ocean Youth Trust. For the record, I am that MSP.
That comment came from the other URCs. I was not involved in writing that comment and I am not quite sure what my colleagues meant by it.
I will have to refresh myself on that point. We have common targets in as much as we all look at leverage, jobs and space regenerated and so on. There is some commonality in the types of KPIs that we have.
I will read a small part of that paragraph. It states:
We report on 34 different indicators through our management and evaluation report. It probably is the case that a smaller subset of that would be more usefully interpreted in respect of URCs. For example, in our submission we have pulled out four or five key indicators rather than the full 34, which tends to confuse matters a bit. There are a number of key indicators that we would all accept are appropriate.
Would you all measure yourselves against all 34?
We report on 34, but there are more—
There are 34 that you would report on to the Government.
There are more within the monitoring and evaluation framework, but we do not hit all the targets. The targets in the monitoring and evaluation framework cover a whole range of activities. We do not cover them all, but we report on 34—
I think there may be some confusion there.
I want to be clear about one point. KPIs are not targets and targets are not KPIs, are they?
They are not the same. Performance indicators show what progress is being made towards a target.
That is fine—the information was just presented in a way that suggested something else.
Mr Robertson can return to Mr McMillan’s question.
To be honest, Patrick Wiggins has covered the answer that I would have given.
I would welcome common definitions. Even GVA, which has been mentioned, can be calculated in a number of ways. If we are to compare leverage and the amount of land remediated across Scotland, we need to be much clearer about the common definitions.
Phrases such as
You could probably go on for hours on that topic, gentlemen, but I ask for brief answers, please.
The expectations have been demanding, but they are not too great.
It is not just URCs that are resourced to address such problems; we must work in partnership. That is why we feel that community planning partnerships are critical, because they ensure that all the public agencies that work in an area focus on key deliverables to address the deep-seated problems of deprivation. That is not just for us on our own.
Is that the case for every URC?
I cannot speak for others, but I know that all the URCs routinely work in partnership with their local partners. They can say for themselves what form that takes.
There are no two ways about it—in the current environment, we are standard bearers for the regeneration of our area. It is undoubted that close connections with partner agencies are needed. It is important that we have ambitions and that we are demanding of ourselves and our partners, but external factors can kick in, such as an economic downturn. A subtlety concerns how organisations such as us are reviewed in a way that takes account of factors that we might not always have direct control over. However, the reality is that we are thrusting and demanding about getting a job done that has been left for many decades and needs to be completed.
First and foremost, Clyde Gateway is a partnership. We lead on the targets and ensure that they are addressed, but they cannot be achieved without major investment from Scottish Water, without the support of the two councils in the area and the utilities, and without support from the Scottish Environment Protection Agency on flood prevention and decontamination.
Mr Manson spoke about remediation costs. It would be useful to hear how much each URC has invested to deal with that and to get to a position in which it can encourage investment.
I ask for very brief answers, gentlemen.
Every URC is different and faces a different set of issues. The defining issue in the east end of Glasgow and in Shawfield in South Lanarkshire is ground conditions, so the bulk of our public funding has gone into bringing sites up to a state from which they can be developed. About £70 million or £80 million has gone under the ground to fix the problems of the past. Without that, nothing would have happened.
It would be useful to have the specifics in writing to the clerks.
I am unable to give you a specific figure. However, for our primary site—Queen’s Quay—the decontamination, site preparation and major civil engineering cost about £8.5 million out of a total redevelopment cost of £60 million. That proportion is often reflected in our other locations.
Again, it would be good if you could get details to the clerks.
Our decontamination costs are less because we have avoided some of the worst contaminated areas in our patch. The costs tend to be quite light, so a lot of our expenditure is on site assembly and infrastructure to open up the sites.
I do not think that any of this applies to Mr Adair to any huge extent, does it?
No, it does not. For example, we have probably spent only £5.6 million on site infrastructure, although that does not include costs incurred by the City of Edinburgh Council for site clearances.
Okay. It would be useful to get the detail to the clerks.
Comparisons between the URCs are useful because of the history of the areas. However, they are very different, so detailed benchmarking does not take place. I benchmarked against the urban development companies and corporations in England, but most of those have now been abolished in one way or another. However, in the east of London, significant onward investment is going on and I compare us very closely with that. The level of investment that is going into the east of London is astonishing. For example, post-Olympic games alone, £0.5 billion has been invested in continuing the legacy. So, I benchmark against that and I aspire to that.
I can understand that, but surely you have near neighbours and could benchmark against what they do.
As has been mentioned, local circumstances can be such that it might be difficult to undertake direct comparisons for benchmarking. On whether we are friends or rivals, it is fair to say that we are all part of the regeneration movement, so without speaking on behalf of my colleagues, I would suggest that we are friends.
We are definitely allies, not rivals. We learn a lot from one another, quite often about ways of delivering. There are significant differences between the URCs in terms of population, geography, types of land issues and depths of market failure, but we can learn from one another’s practices. We do that by officers from the different organisations having regular contact.
I agree with the previous comments, particularly those from Patrick Wiggins.
Okay. Thank you very much for your time, gentlemen. I suspend the meeting for a few minutes for a change of witnesses.
We now have our second panel of witnesses. I welcome Allan McQuade, business infrastructure director of Scottish Enterprise, and Douglas Duff, member of the Scottish local authorities economic development group and head of economic development and environmental services at Falkirk Council. Does either of you gentlemen want to make a brief opening statement?
I do not.
If you do not mind, convener, I will give a brief opening statement to explain a bit about SLAED and my purpose in coming along to this meeting.
Thank you, Mr Duff. I will start by asking you a few questions about economic development activity. Committee members have visited various places at different points and we know that some councils choose to invest quite heavily in economic development activity but that some do quite a lot less. Given your national experience, can you give us an indication of how much of the economic activity that is taking place in the 32 local authorities is looking at regeneration, particularly community regeneration?
SLAED has done work recently to estimate councils’ total commitment to economic development activity, which works out at about £213 million annually and is recognised as a significant contribution. I do not have details of the breakdown across the various fields of activity but I could certainly ask for that. The total amount covers our activities in respect of physical regeneration, employability and business support.
It would be useful for the committee to have that information. We all have a certain amount of experience of economic development activity in our areas, and we know that activity can be extremely varied. It would be grand to get an indication of how much effort is put into regeneration.
As you know, our primary focus is on increasing Scotland’s economic prosperity. We moved away from local regeneration in 2008, when the approach to enterprise companies changed, and in 2012 we moved away from funding urban regeneration companies.
May I stop you there? You said that you have moved away from regeneration to a degree and are concentrating on economic growth, but you have listed a number of regeneration projects in which you are involved. It seems that Scottish Enterprise has not stepped away from regeneration.
We have absolutely stepped away from local regeneration in relation to councils’ responsibilities. We are still working through legacy issues, such as at Ravenscraig and Gartcosh, and we are involved in regeneration to the extent that we bring expertise from a national perspective, for example in relation to the closure of Diageo in Kilmarnock and Rolls-Royce’s move from East Kilbride—I am on the East Kilbride task force.
I find it interesting that you said that you have moved away from regeneration, but at the same time you listed all those projects, which are either adjacent to or in regeneration areas, and you said that there are monetary commitments to regeneration projects such as the Dundee waterfront. Maybe it would be a good idea if you sent us some detail on the framework that you work to in this regard.
By way of clarification, I say that our primary focus is on creating economic growth. The proportion of Scottish Enterprise’s overall budget that is allocated to the areas that we are discussing is small. Many of the projects are partnership projects and we bring our expertise to assist with their development.
However, the aim in certain areas is to grow the economy through regeneration projects such as the Dundee waterfront.
That is one. Yes.
I think that we require further clarification. It would be good to get an indication of how much money is being spent on some of the projects in regeneration areas.
I am happy to provide that.
I have a question specifically for Scottish Enterprise, although Mr Duff might wish to say something on it as well. My constituency crosses the boundary between the areas of Highlands and Islands Enterprise and Scottish Enterprise. HIE has a social aspect to its remit and, in the long run, we can see the effects of its efforts in generation, perhaps, rather than regeneration, because there was nothing there to start with. Does HIE have some advantages in the area because of its different remit?
That is an interesting question. Before I joined Scottish Enterprise, I worked at HIE. It has different challenges in that it is charged to unlock things under its communities remit. I think that it would be unfair for me to comment on that, because Scottish Enterprise has a remit and is working to it, as does HIE. There are many challenges in rural areas of Scotland and we could look at them and say that they are similar, but I think that it would be unreasonable for me to comment or speculate beyond that.
I will develop the rural issue. Of the mainland council areas, Aberdeenshire is the one with the greatest proportion of its population living in a rural area—the proportion is 2 per cent higher than in Highland. There are substantial rural areas within Scottish Enterprise’s remit, including elsewhere in Scotland, such as in the south in particular. Given that the social aspect is outside Scottish Enterprise’s brief but is included in HIE’s brief, in the partnerships and relationships that you have with others, do you see that part of HIE’s remit being discharged by others?
Again, I do not have enough experience of rural areas to be able to comment on that. Scottish Enterprise has strategies to support the economic growth of our rural areas but, as we have discussed, it is not within our remit to become involved in the communities remit that HIE has.
Forgive me, and let me have one final shot at this. As an individual, you are perhaps in a unique position to be able to help the committee because you have been in both HIE and Scottish Enterprise.
I do not see limitations, but I would qualify that by saying that most of my focus is on the urban areas of Scotland, so I do not see that on a day-to-day basis.
That is good enough, thank you.
My question is for Mr McQuade. What role do you believe you play in the community planning process?
We are a fully engaged partner. We are involved in all the community planning partnerships through senior officers at Scottish Enterprise who are representatives to each of the organisations. As part of that responsibility we have a senior officer within Scottish Enterprise as a location director, a role parallel to that which the Government has, with each of the local authorities.
You say that your engagement with some is different from that with others. Does that mean that some of the engagement is good and some not so good? Where does the difficulty lie? Does it lie with the individual community planning partnerships or is it perhaps the case that you do not have the right personnel engaging with the community planning partnership?
I will answer from my experience. I have responsibility for three local authorities and it depends on the focus of the community planning partnership how they engage and what the priorities are in a specific area.
You say “how they engage”. Surely you, as a member of a community planning partnership, have some say in the direction of that community planning partnership.
We do.
You have said that your focus is on economic growth. I imagine that most community planning partnerships have similar goals in their single outcome agreements.
Yes.
Could you maybe expand on where the difficulties lie?
I am not highlighting difficulties. I am flagging the fact that relationships across partnerships can be different and that in some they are better than others.
For what reasons? What makes a good relationship compared with a bad relationship?
You are referring again to good and bad. I am not. I am saying that some relationships are stronger than others.
What makes a strong relationship, compared with a weak one?
There is potentially a stronger relationship where one has worked with a colleague over a number of years compared with becoming involved more recently in a partnership. It takes time to build relationships.
We may come back to that point.
My next question is for Mr Duff. During the committee’s visits to communities, community groups often told us about the difficulty of trying to access resources because access is overly bureaucratic and the funds are available only for a certain time. Is that your view? How would you go about rectifying it?
Circumstances have certainly been very challenging. There has been quite significant pressure on budgets across the board and there has been pressure in areas that have focused on community support. A lot of that comes down to demonstrating the evidence of the benefits of community engagement and, having seen some of the committee’s work, I know that you have seen some good examples of proposals for community projects that have justified their call on resources.
The message is to keep it simple.
Certainly. The whole field has been through significant change and, in fact, is going through further change as certain budget prospects come to fruition. With the further reductions that we expect in council budgets over the next three to five years, every pound will be a prisoner. As a result, community engagement must be viewed as a priority in the range of activities that we are undertaking and how it takes place and plays its part in meeting the other pressures that we face must be made clear and simple.
How many of your members are involved in community planning partnerships in the 32 areas, either at board level or just below?
Economic development is a priority in every council’s community plan. That is clear and understood and you will see it embedded in all community plans and SOAs. However, our involvement or not in the various partnerships comes down to the priority that the issue is afforded within the range of other pressures that community planning partnerships are dealing with. In some council areas, where the economy is relatively sound and robust, it is perhaps not as much of a priority and there is less of a resource input. However, in the vast majority of council areas, economic development is certainly viewed as a priority and economic development officers are pretty regular attendees at CPP meetings and are expected to account for the actions in their SOAs and their commitments in the community plan.
I wonder whether you can give us an indication of your position in Falkirk. Are you on the board of the Falkirk community planning partnership?
No, but over the year I or someone covering our economic remit will attend perhaps half of the CPP’s leadership group meetings; for example, regular reports are sought on our work on the my future’s in Falkirk economic strategy. Given our community planning partnership’s very strong focus on employability and the fact that helping young people into the labour market is seen as a priority, such issues are frequently aired and discussed, with not only the council but other partners reporting on how they support that work.
Where does your engagement with communities fit in with the community planning partnership?
Engagement with communities tends to come through the particular activities that we have under way, whether that is our work in town centres, or the Helix project that I mentioned earlier. That came through an active community engagement process. It tends to be horses for courses. Community engagement is only one aspect of what we do in economic development, because we have a range of other responsibilities.
A lot of work is being done in Falkirk and Grangemouth town centres and particularly in Denny town centre. I know those areas well. You engage mainly with the business community in that work. How do you engage with communities? The committee has been trying to get to a definition of communities that refers to the people who live in deprived or low-income communities, because we need to engage them in discussions and decisions on economic development issues. How do you do that in Falkirk?
In Falkirk Council, we use a range of tools in our community engagement activities, particularly in town centres. Our work is not just about engaging with the business community, although we engage actively with it. For example, we have a business panel, and any business in Falkirk is entitled to be part of that.
My question was about engaging with communities, not business communities. I know what work is taking place with the business community in Falkirk. However, I am trying to understand how we engage with the residents around the town centres and with those in other communities that are struggling economically. How do we get them involved in decision-making processes, which in your case are those of Falkirk Council? You referred to engagement officers; are they linked to your economic development unit? If they are linked to another council department, how do you make links with them when you try to engage with, say, those who live in the communities around Denny town centre and who are concerned about town centre issues?
We have officers who are responsible for engaging with the community. They are actively involved in working with communities in each of the town centres. In the past, we have conducted community surveys and held events when a proposal or scheme is being put to the community. We arrange events and involve people in shaping proposals.
I welcome your enthusiasm for the community engagement that you have in Falkirk. Is that community engagement replicated throughout the 31 other local authorities? Are all economic development units as high profile in their local authorities as you have said that yours is in Falkirk?
Diverse approaches are adopted. The tools are all there in the box for regeneration, for community engagement, for the delivery of physical projects and employability and for community benefits, which I mentioned. People know how to do those things. Our officers are equipped to use the tools and they use them.
What would you say to the communities, housing associations and community organisations that the committee has engaged with that want to get actively involved in economic development issues but feel that they have been ignored or bypassed and have had decisions foisted on them without any consultation? What is SLAED’s attitude to those issues, which have been raised with us as committee members?
We recognise that we have a way to go. The task of regeneration was transferred to councils and a specific focus had to be brought together. We used to work closely in partnership with Scottish Enterprise locally. Now, councils are charged with taking forward the agenda.
You have talked about engagement and all the rest of it. We hear a lot about that, but we do not hear about the influence that the community has in shaping and developing small and major projects. In Falkirk, what influence does the community have in shaping the larger projects that you have talked about and the smaller projects that often make a huge difference to people’s lives?
I come back to my earlier point about the tools in the box.
We have heard about the tools in the box. What influence do people have?
If we were talking about initiating a project in an area, we would want to address how the community there might be engaged in shaping it.
Can you give us an example?
If a town centre was involved, we would want to start a conversation with people who had a stake in that town centre. We did that recently in Falkirk. We have hosted open events with retailers from the area and anybody else with a stake, including community interests. The historical bodies were there in force along with the local business improvement district and town centre management interests. A range of stakeholders can come together.
You have talked a lot about stakeholders, but you have barely mentioned anyone else who might have a community involvement, to paraphrase what you said. I understand folk from business improvement districts having a great say in and influence over what happens in Falkirk. I imagine that, if the business organisations there are well organised—I am sure that they are—they will greatly influence what happens. However, there are other community interests. I have found—as, I am sure, have others—that folk who live in town and city centres and those who regularly use town and city centres often feel that they have had no influence over things that have gone ahead. From what you say, I still get the impression that, although influence is brought to bear by a number of bodies, the community interests are put to one side.
I apologise if I have given that impression. Such people are openly seen as active participants in the process when events are held. We held an event recently in Falkirk with about 150 people in a room, many of whom were just people who had walked in off the street and were concerned about their town centre. They expressed their views and those comments were all captured. At the end of the meeting, volunteers were sought to consider how the issues should be addressed. That work is being taken forward by a small group of volunteers, who include people from the community, retailers and people from the business improvement district. It is early days and there is no formal structure to that but, in time, there could be. That group is capturing all the concerns and feeding them in.
You have just said that a group of volunteers who put themselves forward is driving that work. Those people are self-selected, and one difficulty that we have found with a number of community organisations is that self-selecting groups can suddenly become the voice of the community.
Yes—we, too, recognise that that can be a concern. That is why, in addition to undertaking such an exercise, we have to conduct broader surveys and consultations with specific interest groups.
You can help us by writing to us about the examples that show that there has been a community influence on the delivery of projects.
I am happy to do so.
I would be grateful if you included in that information something about the 150 people who participated in the event that you mentioned. I assume that the retailers and the business improvement district members are the same people; the members contribute financially to the business improvement district. I have spoken to a couple of retailers in Falkirk about business improvement district issues.
If Douglas Duff could provide that information as well, that would be grand.
They are just wee, quick questions. I hope that if I say them fast, we will get through them. Can you tell me, Mr McQuade, how much funding Scottish Enterprise has provided to the six URCs to date?
We are involved with just the four: excluding PARC Craigmillar, we are involved with the other three that were here today, plus Riverside Inverclyde—the west URCs. We are not involved financially in the Raploch or Craigmillar URCs.
I apologise for that mix-up. How much funding is provided to the four URCs?
I would need to get back to you with that information.
That would be helpful.
The information will be in the submissions from the organisations involved.
Will how you evaluated the effectiveness and impact of that spend be written down somewhere, or are you able to tell us about that now?
We are not in a position to do that at the moment because, as you heard in the earlier evidence session, we are going through an exercise with Riverside Inverclyde. I can provide you with, or obtain for you, the internal evaluation of each URC and information about what they have done. They are at different stages of the process. As was said earlier, it is a long-term process and we must give considerable time for the outcomes.
Can I stop you there? Obviously, there are the internal evaluations. We have gone over some ground and will probably go over more in a wee while. However, given that Scottish Enterprise is pumping money in, you must be evaluating what is happening with that money across the piece. If you are not, are you truly following the public pound?
We are following the public pound, and we are doing evaluation. Since 2008, we have had a ring-fenced budget for the URCs, against other priorities that the money could have been spent on. That is not to say that it was just given over. The budget was set against priorities and we worked in partnership with the Government—which is also a part-funder of the URCs—around the outcomes that we expected.
So you must be evaluating all the way through.
Yes.
You said initially that you could not give Anne McTaggart an answer to her question.
We evaluate the URCs’ business plans and proposals. Do we look at whether their proposals are in line with their business plans? Absolutely. On whether they are achieving the outcomes, I have said that those are long term and we are going through the process with Inverclyde—
We understand that a lot of the outcomes will not happen just like that and that they will happen over the piece. I think that the committee gets that completely and utterly.
Yes. As I have said, we assess the URCs’ proposals against their business plans. As they drew down money—they no longer draw down money from us—against the plan, we reviewed what they did with the money. We therefore follow the public pound to ensure that it is spent on what it was allocated for.
I understand that, too. However, my view is that you should look at not only what the money was allocated for but the outcome from that expenditure of the public pound.
Yes, but that was part of the business planning process. The URC evaluated its business plan through its board, with representatives from Scottish Enterprise, the councils and, usually, the Government in attendance. There was then an agreed allocation, against which the money was drawn down. Checking the outcomes is an on-going process, as colleagues from the URCs discussed earlier.
At any point did you stop putting money into certain areas of work in certain URCs because you did not feel that there was value for money from what was being done?
No, we did not stop putting money in, because it was a ring-fenced budget. The value for—
I am sorry, Mr McQuade, but I have dealt with ring-fenced budgets as a councillor. Just because a budget is ring fenced—
I am sorry to interrupt you, but let me answer the question in a different way. There was never a case where we felt that there was an allocation of money that was inappropriate in terms of what the outcomes would be.
Okay.
My next question is on a different aspect of finance. What proportion of your expenditure goes on regeneration activity? Of that, what proportion supports community and social regeneration?
As I said, I will provide information later on the amount of money that we spend, but I can comment on whether it provides indirect support. The moneys that we put into regeneration activity are for physical regeneration. We are a business development agency, so only a very limited amount of our money would flow through to the community, as that is not part of our remit.
Thank you.
Good morning, gentlemen. I have a couple of questions. The first one is about the Irvine area and Irvine’s enterprise zone status. Mr McQuade spoke earlier about legacy issues, sector growth help, RSA, which obviously goes into areas of most need, and the major sectoral initiatives. Given those factors, how is Scottish Enterprise working with the likes of the Irvine Bay Regeneration Company and the i3 Irvine enterprise area to ensure that they maximise what they do?
It is the same process with all the URCs. Our position is that if they have sector development projects that fit with our business plan and our priorities, and if there is a case for investment, we would take a case forward for Scottish Enterprise’s investment and support.
I assume that there are regular discussions between Irvine Bay Regeneration Company and Scottish Enterprise. You mentioned the large site that Scottish Enterprise owns. Are there any particular blockages to promoting that area?
Demand is a blockage, given that the market is the way that it is. Obviously, we have a remit to promote Scotland, so we will give every area an opportunity, but demand is currently limited, particularly in the data centre market. If you are thinking about relationships, for example, I do not see any blockages. We work closely together.
Okay.
No. Scottish Enterprise is a national agency, and we promote opportunities in all areas.
Do SE and SLAED have any comment on the impact of the current procurement process and rules on the successful delivery of economic, physical and regeneration activities? How do they make full use of European Union funding to promote and help those activities?
In this day and age, the procurement process is long, but the way to achieve what we want to do is to anticipate it, live with it and work with it. There is no criticism of the process. We are spending the public pound, so the process is appropriate.
I concur with Allan McQuade. Procurement practice has become intensive for the right reasons. We are expending public resources, so we have to do it properly.
You talked earlier about a joined-up, co-ordinated approach to development and adjusting the market. You mentioned retail units, for example, and Scotland is full of retail units that are not being taken, some of which were built by developers. Nothing depresses an area more than retail units—particularly new ones—that have never been taken.
I do not have all the answers. The recent national review of town centres made some recommendations and posed the serious questions that are being asked throughout the country and which affect every town centre. The clear expectation from that review is that, if we are to encourage investment in town centres, they need to be given more priority, recognition and prominence when it comes to using tools such as business rates.
I want to focus on adjusting the market. If something is not working, how do you change it?
The national review suggested that we need to prioritise town centres and restrict out-of-town development. That is now recognised as an important recommendation from the review. Local plans have recommended such an approach for many years, but the recommendation is about consolidating that.
Are you taking that into account in adjusting the market?
Absolutely. You can see that up and down the country just now. The approaches to town centres that we are now talking about are about being much more focused on what can be achieved. There will be circumstances in which we say that the commercial core that town centres used to have will have to shrink and other uses, such as housing and other civic amenities, will have to come in to replace that.
I thank you very much for your evidence, gentlemen.
For our final panel of witnesses, I welcome Margaret Burgess MSP, Minister for Housing and Welfare, and David Cowan, the head of the regeneration unit at the Scottish Government. Minister, would you like to make an opening statement?
I start by emphasising the Scottish Government’s commitment to ensuring equality of opportunity and support for the places and people who need it. I recognise that that need remains great, particularly because of the recession and the emerging issues that have been caused by the UK Government’s welfare reforms.
Thank you, minister. I welcome your announcement about the charitable bond. I am sure that members will look at that in some depth later.
I fundamentally agree that people are at the heart of regeneration. I believe that people are at the heart of everything that we do in government and that everything we do across government aims to improve people’s lives and communities, and to improve businesses to allow Scotland to flourish. That is at the heart of the Scottish Government as a whole. Regeneration does not sit in isolation. People are at the heart of our regeneration.
The minister may be aware that we have just been hearing from the business infrastructure director of Scottish Enterprise. I realise that the minister is not responsible for the enterprise network, but does she feel that the fact that Highlands and Islands Enterprise has a social obligation as part of its remit but Scottish Enterprise does not has led to that enterprise network not being as fully engaged in this agenda in much of Scotland as HIE has perhaps been over the long run in the north of Scotland? The context for my question is that my constituency crosses the boundary of the two enterprise bodies and I am therefore, perhaps uniquely, in a position to compare and contrast.
I am aware of how Highlands and Islands Enterprise engages with social enterprises. As you rightly said, however, the enterprise set-up is not within my remit. In some ways, with the sector led as it is now, we will see benefits when compared with the past. We have to move on, but we have to have some support for social and community enterprises in every area. Whether that will be done through Scottish Enterprise or, in your area, Highland and Island Enterprise, or some other way, it is absolutely right that we support social enterprises.
Is the minister telling the committee that, in the future, power will be as close as possible to those who will be affected by the decisions? In other words, if we engage local communities and bodies, the outcomes and the quality of the decision making will be better because the stake is higher for those people and they understand the problem better.
That is absolutely what we mean by community-led regeneration. Communities identify the issues in their areas and get involved. All the evidence shows that, where a community has been involved at the outset, the outcomes are better for that community. I have also seen the kind of enthusiasm that the convener spoke about. I spent the whole recess visiting various communities and community groups that had been funded by the people and communities fund or through other resources, and I saw the impact that they make on their communities. It does produce sustainability, but not every community is at that level and some have to be supported to get there.
We heard in the earlier witness session that there is a lot of potential for procurement to play a role in encouraging regeneration through the use of community benefit clauses but, of course, your cabinet secretary—the Deputy First Minister—will be bringing forward a new sustainable procurement bill. Will there be a focus in that bill on how procurement legislation can also be used to support regeneration initiatives?
Yes, because we are looking at community benefit. The idea that there should be some community benefit has been looked at closely in relation to the procurement bill. It is part of regeneration. As I said initially, regeneration is not about just one strand of Scottish Government policy; it crosses all the policy areas and therefore it is about the collective and the collaborative way in which we can regenerate communities, which includes what we can do through procurement, through housing and through addressing health inequalities. All that is part of regeneration.
It might be that there is not just one strand to regeneration but, obviously, housing is a very important strand. We looked at the figures for the Irvine Bay Regeneration Company, for example, which had a target of 1,200 new homes, of which eight have been built. In retrospect, is it your view that the Scottish Government could have done more to allow those targets for housing to be closer to being achieved or was it simply that some of those projects were too reliant on housing? Why has there been a specific problem with regard to housing initiatives for many of those projects?
I will ask David Cowan to comment as well in case I am wrong, but I think that the Irvine project that you talked about was one that they hoped to attract private finance for, and the market failure did not allow that to happen. However, a lot of other things are going on in regeneration and housing, with our housing associations and with the Scottish Government funding for affordable housing, so housing is part of regeneration. David, am I right about the Irvine project?
Yes, that is my understanding as well. It was one of the projects that the Irvine Bay Regeneration Company was hoping to attract private investment for, which obviously has yet to happen. However, as the minister said, that is not what is happening across the piece. Housing is going quite well.
Other schemes have had similar problems, but you are saying that the issue is market failure in the private sector rather than, from your point of view, lack of support from the Scottish Government.
Yes. The Scottish Government has a target for our affordable housing programme and we are quite confident that we will meet that target.
Good afternoon, minister. Two weeks ago, we had representatives in front of the committee from Riverside Inverclyde and it was quite a lengthy session, as you will be aware. One of the things that came up for me was to do with what was going on there. I am keen to try to understand what role the Scottish Government had in keeping an eye on activities within RI. Could the Scottish Government have done anything else to scrutinise what was taking place? Could it have done any more?
URCs are not part of the Scottish Government although they receive Scottish Government finance. URCs are partnerships between local authorities and Scottish Enterprise, and they are private companies. In relation to the funding that we provide, the Scottish Government looks at the URC business plans annually; we discuss with them whether we think the business plan is feasible, and the funding is paid quarterly in arrears to the URCs.
When was the request made to RI to revise its plans?
The then cabinet secretary, Alex Neil, wrote to Inverclyde Council and Riverside Inverclyde URC at the beginning of 2012 on the spending plans and the Scottish Government’s likely allocation. He wrote to Riverside Inverclyde indicating that he would give it funding in 2013-14 and 2014-15, but that that was predicated on the URC submitting revised business plans to the Scottish Government and its board and submitting plans for the future of the URC in light of the funding circumstances.
I assume that, as a consequence of that correspondence, fairly regular discussions took place on the matter between Scottish Government officials—and potentially the cabinet secretary, although I do not know—and officials from RI and Inverclyde Council.
Yes. I went to a board meeting where the issue was discussed and I met the then chief executive, Bill Nicol, fairly frequently to discuss progress on revised plans. It is fair to say that not a lot of progress was made on what the URC might look like in future but, in my view, and from speaking to the council and Scottish Enterprise, the reason for undertaking a mid-term review was to consider the future options for the model for the URC.
Yes, but I believe that the mid-term review was agreed at the outset of RI, once the management structure had been agreed.
The articles provided for a mid-term review to take place, but the timing was not pre-decided. In light of the financial circumstances and the funding elements, it was decided that it would be a good time to do the review.
So you are saying that the timescale for the mid-term review had not been decided.
The specific date had not been decided, but there was a broad expectation that it would take place roughly halfway through the lifetime of the URC.
Right. There seems to be some confusion about when the review was to take place. I am sure that I have read somewhere that it was to happen five years after the management structure was signed off, which was 18 months after RI was created. Is that correct?
Yes, that is broadly correct, but the specific date of the review was not decided. The review took place in light of not just what was agreed in the articles but the economic situation and the funding settlement that had been agreed.
Right—okay.
The bidding process for the regeneration capital grant fund is not specifically for URCs, although URCs and special purpose vehicles can bid to it, as can local authorities. The funding arrangement for that was agreed with COSLA—it is £25 million a year, less the core amount for URCs, although it has not yet been agreed how much will go to each one. It took time to come to that arrangement. We have had bids for the fund already. An independent panel is considering them, on the basis of criteria that include community participation, social outcomes and quality. That process is fair. The first 41 bids have been moved through to stage 2 of the grant process and they will be looked at, although I would not want to say how many will be successful. The criteria are quality, community participation and social outcomes.
Some URCs now have community representatives on their boards. Would it be fair to suggest that if there were more community reps on the boards of the URCs, they might stand a better chance of being successful in bids?
I cannot comment on that. An independent group is looking at the bids and I will certainly not say whether that would be one of the criteria. As I have said, the criteria are quality, community participation in the bid and social outcomes.
You mentioned that your view of regeneration expands over several areas. How do you monitor that and evaluate it?
We monitor housing according to whether we meet our targets for house building. Each sector of Government monitors the area for which it is responsible; the issue is to look at that altogether. Were you asking about monitoring something specific?
I am thinking about the role of community participation in all this.
Could you be more specific about which bills you are talking about?
I mean the proposed bills on procurement reform, European funding, community empowerment and renewal, cities and the national planning framework.
When I talked about community-led regeneration, I did not necessarily mean that housing developments would be led by the community. It is about involving the community in the siting of regeneration projects. The community empowerment and renewal bill speaks for itself. It is about engaging and working with communities. I do not want to pre-empt anything that may come up when the bill goes out for consultation.
It was the bill on Scotland’s cities.
The cities strategy does not sit in isolation. It is about community involvement and benefiting the city. It is also about the wider city and what is happening around the periphery of the city, and ensuring that there are social outcomes. In all the strategies, we are looking for social outcomes.
I know that the role of community associations is a topic that is dear to the minister’s heart. Should those bodies have a statutory role in the community planning process?
Community associations?
I am sorry; I meant housing associations.
Where appropriate, every community planning partnership should involve its local housing associations. We would all agree on the role that housing associations and co-operatives play in their communities.
Good afternoon, minister. I want to follow up on Anne McTaggart’s questions.
I repeat what I said to Anne McTaggart: housing associations have a role to play.
I welcome the minister’s response and hope that the housing associations that have spoken to me will look at the Official Report of this meeting and respond accordingly if they feel that they have been excluded.
The Scottish Housing Regulator is an independent body that is not answerable to Government; it is answerable to Parliament. I believe that housing associations have a wider role. The regulator looks at tenants, those who get services from social landlords, how that is managed, and the financing of the housing associations. As I have travelled around housing associations, I have seen—and I still see—what they can contribute in a wider role. I am not aware of that being curtailed in any way, and I believe that they have a role to play.
I should have said at the start that I welcome your announcements this morning on charitable bonds and on the revamped website to provide funding information for community organisations.
The funding that is available for community groups through the website that I mentioned is purely from the Scottish Government, and is accessible directly by community groups. The vacant and derelict land fund is separate, and the moneys are distributed in agreement with COSLA. It has recently been agreed that the fund will carry on as it has been doing for this year, but we are looking at how those moneys will be distributed in future years. We will need to have discussions on that with COSLA.
We have been considering regeneration and how communities are engaged in that process. We heard evidence from the URCs today—and we have read their submissions—on the amount of public money that has been ploughed into regeneration projects in particular areas of Scotland. The committee has, on its previous visits to communities, heard evidence from community organisations that, for every £1 of public money that is received, there is a £14 return for the area.
Anchor organisations are part of the rationale for the people and communities fund, as they help to ensure that the money is used in the community to benefit the community itself. Through the review of community planning partnerships and single outcome agreements, we must ensure that communities are participating properly in regeneration, and that there are outcomes to address disadvantage and inequality, which are priorities that need to be tackled. In all our funding, we will be considering those aspects, and we will be encouraging, assisting and promoting communities to become involved in the work, and to lead it themselves, where they are able to do so.
On that, the Government’s regeneration outcomes frameworks are clearly linked to single outcome agreements, and to the benchmarking work that the committee has recently investigated. Given those links, and what you have just been talking about, will the Government be able to undertake much greater monitoring of the regeneration outcomes that we all hope will improve? Will you ensure that there is community input, and that—as John Wilson said—communities are listening to you?
I certainly hope that we would, under the revamped single outcome agreements, be able to do that. Community planning partnerships are accountable to their communities—the results for their community are what matter. That will involve monitoring child poverty, what is happening to older people, and improvements for the disadvantaged.
Thank you.
Absolutely—we have to look at both. We cannot do one without the other, and we must take an holistic view of communities. We are putting more emphasis on community-led regeneration, which was not so apparent before, because that is critical, but we need both approaches. We still have to ensure that the environment looks good, and that towns and communities are welcoming so that people want to move into and visit them. Part of people’s wellbeing derives from the area around them.
The URCs have been a key initiative of the previous Scottish Executive, and latterly of the Scottish Government. Will they continue to be sustained so that they can meet their targets? What lessons have been learned to date from their activity? Will there be more URCs?
I will answer the last question first, because it is the easiest. I cannot say categorically today that the Scottish Government has no plans for more URCs. I cannot know whether, in the future, local authorities might want to set one up as a special purpose vehicle that would not be funded by the Scottish Government.
Ian Manson from Clyde Gateway gave us an estimate of approximately £80 million for remediation costs in his area, and we will get written details from the other URC representatives after this meeting.
That is what I was getting at—if we had the knowledge when the URCs were set up that we have now, things might have been done differently. We are where we are with URCs, and the Scottish Government’s support for them is now being reduced considerably.
We have received evidence to suggest that community projects have been derailed by the threat of European Union state aid regulations. It is difficult to believe that those regulations are aimed at projects of this nature. One witness described the response to the regulations by officers as “duck and cover”. Will you provide a clear lead to ensure that state aid regulations are not an inhibition to community projects?
There are two points in that regard. I would not want state aid to inhibit community projects, nor would I want community projects to fall foul of the regulations, as I understand has already happened—not in Scotland, but elsewhere.
We have heard evidence, in going round the country, that some regeneration communities are not getting enough money out of the mainstream budget pot. People from some local authority areas have said that they are not getting the same level of service or having the same amount of money spent on services in their community in comparison with other communities that are not designated as regeneration areas.
Are you talking about the local authority settlement? I am not quite sure.
An example would be environmental services such as street cleaning. In a leafy suburb, there may be a much more intensive service, many more street sweepers and a better bin collection than there is in a regeneration community. It could be argued—as some folk outside the Parliament have said—that the direction of travel in certain areas of spend from mainstream budgets seems to be moving away from regeneration communities.
With the step change to community planning partnerships, I think that there is a need to focus on areas of disadvantage and inequality and gear services around those. If you are asking me as Minister for Housing and Welfare how we can sort that, I would say that the issue is whether partnerships have that focus and are accountable to their community. Where communities are not getting the services that you mention, we need to consider whether they are as vocal as they need to be, which is sometimes an issue as well. Part of capacity building in communities is about making people aware that, as well as providing services to all areas, community planning partnerships and local government are about improving the lives of people in the most disadvantaged areas.
We need to build capacity to allow local communities to scrutinise much more.
I believe that communities should be empowered to hold their local government to account properly. I think that communities need to do that. Often, the most vocal and the most articulate get the most services, so we need to look at how we can encourage everyone to take part to ensure that their voice is heard. We need to promote that.
The convener’s question reminds me of a comment, which was made in Castlemilk in the early 1990s, that people wished that they had a royal visit every week because the streets would then be swept every week.
There are some examples of that, but regeneration and economic development are essentially devolved to local government and community planning partnerships. Also, when one group moves out of the deprivation index, another five groups might move in—I am not saying whether that is right or wrong—so there will always be a bottom 5 per cent. We need to ensure that the same 5 per cent do not remain at the bottom on every occasion.
As you were speaking, minister, I saw Mr Manson in the public gallery nodding his head.
On the issue whether areas of multiple deprivation have benefited from regeneration schemes, I think that the minister is right to identify an area such as Bridgeton. Is improvement of areas of multiple deprivation an indicator in the single outcome agreements? If not, should that be an indicator for those local authority areas in which we see persistent areas of multiple deprivation? Bridgeton may be an exception, but a mile further up the road the communities around Parkhead have not benefited as much as Bridgeton has perhaps benefited.
It is up to local authorities to determine which indicators they want to look at to achieve what they are looking to achieve—perhaps David Cowan can say a bit more on that—and it is up to local authorities and community planning partnerships to know their area. If community planning partnerships are strong and working well, they should be looking very closely at what indicators they want to use to ensure that people are actually benefiting. For the soft indicators relating to people’s wellbeing and lifestyle, it has always been difficult to measure improvement. People might say that things have improved, but how to measure that is an issue that needs to be considered. The issue is about getting actual outcomes, which is what we would want to look at.
Community planning partnerships set their own priorities, so the indicators against which they choose to measure progress are very much for them. We have just gone through the process of setting single outcome agreements, which were signed off by council leaders and the Scottish Government, and those single outcome agreements went through a peer-review process. I suppose that it is up to community planning partnerships to decide, but certainly all the messaging is that community planning partnerships should be taking steps to improve areas of multiple deprivation.
Thank you very much. I thank the minister and Mr Cowan for their evidence. We now move into private session.