Property ‘inertia’ could last 18 months post-AWM
AN “inertia” in the public sector following the break-up of Advantage West Midlands could last up to 18 months, according to a Midlands regeneration director.
Mark Richards, project management director with Birmingham-based consultancy Turner and Townsend, says the reliance in the region on public sector money could lead to a “more polarised approach to development” as little new money flows into the coffers of the Local Enterprise Partnerships .
The comments come as the region’s property industry reacts to the on-going debate over the structure of the Government’s new proposed LEPs.
Mr Richards said: “With the new political coalition, perhaps it isn’t too much of a step change to expect collaboration to be driving regeneration forward in the future.
“Economic development crosses political boundaries and AWM has done a good job of transcending these at a regional and sub-regional level.
“It is hard to see how LEPs will fulfil this role. Indeed the landscape for LEPs is far from clear…..what is clear is that there will be little new money to support the work of the LEPs.
“Whilst AWM will operate until March 2011, there will be uncertainty at a time when the public sector is needed to aid recovery and this inertia could last for 12 to 18 months.”
Mr Richards cited the fact that, in the south of England, 90% of private sector investment is unaffected by the public sector but further north, this reliance becomes much more prevalent.
“With the localism agenda, we are likely to see a far more polarised approach to development where the stronger areas with stable, well organised businesses thrive while the economically weaker areas fall into greater decline,” he added.
Simon Crosby, (right) director in the Warwick office of Archial Architects, said: “The Coalition Government’s proposal to replace RDAs reflects an ideological shift in preference at government level from the public to the private sector.
“Given the recent announcement of nearly £300m of budget cuts for RDAs in this financial year, LEPs could well find themselves born into a financial straightjacket that limits severely their ability to stimulate the local economy. With smaller levels of funding likely to be made available to LEPs than was available to RDAs, the level of regeneration LEPs will be able to facilitate will most likely be lessened.”
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Charles Toogood, director of property consultancy GVA Grimley, said: “Despite the Government’s confidence in the LEP approach, whether this move will do anything to help bolster the property sector in the Midlands, in both the short and long term, is questionable.
“The key issue that is most likely to impact the development property sector is the removal of AWM’s function to act as a catalyst to deliver sites that the private sector could not viably deliver alone.
“What remains to be seen is whether the LEPs will work together to crucially assist the private sector in continuing to bring forward regeneration, particularly when local councils themselves are facing massive spending cuts.”
Tony Green, (left) chief executive officer of Hortons’ Estate, said: “They (RDAs) have made a positive contribution to the economy and regional development. This work is more important than ever in assisting the region’s economic recovery, and it is vital that the switchover to LEPs does not halt the process.
“Care should also be taken to ensure that local competition does not replace a strategic approach to identifying areas in need of regeneration and the allocation of funding to kick start development.”
Ian Kibble, regional director of consultancy Lambert Smith Hampton, said: “LSH welcomes the stated objectives of the proposed Local Enterprise Partnerships.
“Hopefully, the local authorities will see this as an opportunity to join with local entrepreneurs in marketing and securing inward investment in the form of new long term employment initiatives, infrastructure demands and land management schemes.
“The present shortage of government grants and its freeze on spending will not last forever so it is an ideal time to establish committed groupings of like-minded organisations that can focus on imperative issues.”
Chris White, head of planning and regeneration at CB Richard Ellis in Birmingham, said: “It’s a shame we’ll be losing the regional focus of AWM, however, in principle, LEPs should be more locally focused as they won’t have to deal with the conflict between regional centres.”
Patrick Downes, (right) director of Harris Lamb consultancy, said: “I do hope the experience the personnel at AWM have obtained can be passed on to the Local Enterprise Partnerships.
“Hopefully, by having a single Local Enterprise Partnership dealing with an individual area, this will clear some of the potential confusion which currently exists given there are a variety of local regeneration companies operating throughout the West Midlands. The LEPs will need to develop a strategic role in order to ensure they can fill the gap.”
