Agency or Funding Regime That Promotes Physical Regeneration - Essay Example

A Critical Assessment of an Agency or Funding Regime that promotes physical regeneration: The North West Development Agency Regional Development Agencies in the U.K. have been created with the primary aim of strengthening regional economies and deriving the maximum benefit from the opportunities that globalization has to offer. The first eight Regional Development Agencies were launched formally in 1999. The ninth, the London Development Agency, came into being in 2000. These agencies function on the principal tenets of sustainability to ensure a long and continuous prosperity to everyone living in the area. Before launching into an examination of the principles that guide these agencies and their functioning toward the uplift of the regional economy, it would be interesting to study and understand what urban regeneration is all about and how it evolved. Urban areas are essentially dynamic in nature. Socio-economic factors, environmental and physical factors all interplay and interact together to generate changes in their structures. Moreover, an urban area experiences thrusts from outside which necessitates adaptation to changes while internal dynamics and pressure try to withstand such changes or accept those resulting in either prosperity or decline. Though each problem may not be unique to a specific rural area, yet each challenge requires a distinctive approach towards the generation and implementation of its solution. Since the beginning, urban areas have always performed a variety of functions, offering shelter, providing infrastructure and opportunities for trade and commerce and opportunities for social interaction, being a few of those. As time passed, the importance of each need changed necessitating the requirement for new infrastructure, more space, more facilities for business etc. These changes in the physical structure and functioning of a town and its social life are inevitable since the town has to reorganise itself to meet the changing demands. These changes are also beneficial in a somewhat indirect way since these changes also make fresh demands for improvement of infrastructure and facilities so that the community within an urban area is forced to adjust itself to the new demands and work towards providing better opportunities for growth and progress. The relation between social deprivation and meagre physical infrastructure and facilities had long been an accepted fact and legislations and policies were implemented for improved infrastructure for health and better living conditions. It was gradually realised that merely improving health and living conditions will not contribute significantly towards the progress of an urban area. It is necessary to improve the economic conditions of an area if there is to be a sustainable progress in general health and social and living status. The 1970s and 1980s saw several initiatives and implementation of policies in this direction. It was in the 1980s that it was decided that funding of resources for the growth and development of an urban area should not come solely from the central state. There should be a kind of partnership between the central government and the local urban bodies for the generation of resources for development. Given that urban regeneration is fundamentally a comprehensive action, directed by a strong vision, aimed towards sustainable improvement of an urban area’s physical, social, environmental and economic growth, it is based upon clear principles of objective progress. It takes into careful consideration all physical and social aspects of the area and is aimed towards synchronized growth of its economy, environment, social structure and fabric through the implementation of a comprehensive strategy based on clear goals. Urban regeneration involves the maximum possible utilisation of the natural and human resources of the area, which includes land and built infrastructure and the existing trade and commerce in the region. It is in essence “an interventionist activity” (Roberts and Sykes 2000: 22) which involve all sectors of the area including private, public and community sectors. Like the area in which it functions, urban regeneration activities also experience change in its response to specific social, political, economic and environmental demands. It is not an activity that is forced from above but it is a movement towards progress that involves the collective effort of the people living in the region and their views and contributions towards the generation and development of superior living and economic conditions. Several Urban Regeneration Agencies were formed by the Government between 1981 and 1993. They were formed mainly with the idea of providing monetary support and guidance to different localities. The year 1990 saw a significant growth in funding by the private sector. Urban regeneration programmes were no longer dependent on central funding but had emerged as a partnership between the private sector and the government. The Regional Development Agencies or RDAs were first launched in 1999 with the aim of spreading wealth across different regions of the country and offering greater economic and social opportunities to its people. It moved away from being solely concerned with urban development and placed equal emphasis on the development of rural as well as non-rural areas. Besides economic growth, these RDAs would also be responsible for the environment of the area and the social infrastructure and healthcare facilities. It would provide opportunities for training and growth and focus on achieving more investment in business and growth and harness the opportunities provided by globalisation to derive in the maximum possible benefits. (Political Geography, 2000) According to Prime Minister, Tony Blair, the RDAs would ‘bring fresh vitality to the task of economic development and social and physical regeneration in the regions’. This is achieved through strategic plans aimed towards better economic progress in the region. It takes into concern the specific needs of every region and provides further opportunities for growth. Since the primary aim of setting up RDAs was to ensure greater prosperity of the country in general, each of these RDAs works towards attaining a growth which is at par with the growth and economic performance of other regions. (Environment and Planning A, 2001) With this aim in mind, the first eight RDAs were launched on 1st April, 1999. The ninth RDA, the Greater London Authority, was launched in July, the following year. The onus of funding passed on to the DTI from the Department for the Environment, Transport & the Regions, in 2001. The Department for Business, Enterprise & Regulatory Reform (BERR) was formed in 2007 and it formally took up the responsibilities of sponsorship for RDAs. (BERR, 2008) According to the Regional Development Agencies Act, 1998, the purposes of an RDA are as follows: (a) to further the economic development and the regeneration of its area, (b) to promote business efficiency, investment and competitiveness in its area, (c) to promote employment in its area, (d) to enhance the development and application of skills relevant to employment in its area, and (e) to contribute to the achievement of sustainable development in the United Kingdom where it is relevant to its area to do so. It further states that a regional development agency’s purposes apply as much in relation to the rural parts of its area as in relation to the non-rural parts of its area. The RDAs are expected to formulate effective strategies to drive the economy of the region and aim towards synchronizing regeneration and development so that the regions are able to advance their competitiveness in relation with other regions and reduce the gap that exists between the economic and social status of different regions. (OPSI, 2002-2008) According to the Act, a regional development agency shall— (a) formulate, and keep under review, a strategy in relation to its purposes, and (b) have regard to the strategy in exercising its functions. The Secretary of State may give a regional development agency guidance and directions in relation to the exercise of its functions under subsection (1), in particular, with respect to— (a) the matters to be covered by the strategy, (b) the issues to be taken into account in formulating the strategy, (c) the strategy to be adopted in relation to any matter, and (d) the updating of the strategy. The issues to be taken into account in formulating the strategy relate to any one or more of the following— (a) the agency’s area, (b) the area of any other regional development agency, and (c) any part of the United Kingdom outside England. It is worth noting that ‘since 2002, the RDAs have created (or safeguarded) over 500,000 jobs, created over 56,000 new businesses and brought over 5,600 hectares of brown field land to life.’ The Regional Development Agencies receive funds from a Single Budget, in which all Government Departments, namely BERR, CLG, DIUS, DEFRA, DCMS and UKTI contribute. (UK Trade and Investment, 2007) However, as has been mentioned earlier, BERR is the sponsor for RDAs. The amount of funding that each area will receive depends on the economic condition of the region which includes the needs of businesses functioning in the area. The table below provides the region-wise allocation for each RDA between 2005 and 2008. Several organizations like the South West RDA (South West RDA, 2008), Yorkshire Forward, SEEDA (SEEDA, 2008) and NWDA (North West Regional Developmental Agency, 2008) are few of the potential pioneers in the field of physical regeneration. Total RDA Allocations by Region £ million 2005-06 £ million 2006-07 £ million 2007-08 Advantage West Midlands 272 284 296 East of England Development Agency 129 134 139 East Midlands Development Agency 156 163 179 London Development Agency 373 391 374 North West Development Agency 382 400 402 One NorthEast 240 251 282 South East England Development Agency 157 163 166 South West of England Development Agency 153 159 162 Yorkshire Forward 295 310 310 Totals 2,157 2,256 2,310 Table 1. The region wise allocation for the RDAs between 2005 and 2008 (Regional Developmental Agencies Online, 2008). The New RDA Tasking Framework was set up in April 2005 to facilitate the Departments concerned and the RDAs to focus on priorities for serving better both the area in consideration as well as the larger national interests. The objective of this New RDA Tasking Framework is to help assist Departments and the RDAs to work on regional priorities in a way that also serves national interests more effectively. This framework requires each RDA to present its Corporate Plan which covers a span of three years. The plans provide full details of how each RDAs plans to allocate its funds towards meeting its objectives that have been stated in the Regional Economic Strategy. (North West Regional Economic Strategy, 2006) The performance of each RDA is assessed on the RDA Progress Reports and its Independent Performance Assessment. The Board Members of the Regional Development Agencies are chosen by the Secretary of State. This is in sync with the Code of Practice issued by the Commissioner for Public Appointments. This Board ensures that the Agency meets it commitment towards fulfilling the aims and goals stated by the Secretary of State in order to utilize its resources to their maximum capacity. It has been stated earlier that there are nine RDAs functioning in the UK. The North West Development Agency and the East of England Development Agency are two such RDAs. The NWDA is a diverse region covering the following: Merseyside Cheshire Lancashire Cumbria Greater Manchester It has an economy worth £98 billion and a population of 6.8 million. The region has 230,000 firms which are mostly small and medium sized enterprises. Several large manufacturing companies which dominated the economic scene of the region are still functional and productive. However, there is marked inclination among the population towards joining the service sectors, a scenario that is largely similar to the rest of the country. Liverpool and Manchester are the major cities in the region. Large urban settlements dominate Preston and Blackpool which Cumbria, parts of Cheshire and Lancashire make up the rural hinterland of the area. The region has the highest concentration of superior chemical and manufacturing units in the country. The Lake District is part of this region. According to its Independent Performance Report published by the National Audit Office in June, 2006, “The region has world class centres of excellence in 14 Higher Education Institutions which is 11% of the England total. It is also home to internationally competitive sectors in biomedical, advanced engineering and materials, energy and environmental technologies, food, creative and digital industries, business and professional services.” (National Audit Office, 2006) The report further states that “NWDA has a clear vision of what it wants to achieve as an organisation and works in partnership with others to achieve this. It has a track record of success in many areas and has good and effective managerial leadership to drive it forward.” According to the Select Committee report on advancement in Science and Technology, the RDAs have been involved in a number of projects pertaining to the scientific and technological growth including initiatives concerning the National Biopharmaceutical Manufacturing Facility, NW Genetics Knowledge Park and the National Microsystems Packaging Sector. (United Kingdom Parliament, 2003) The economic strategy for the North West Development Agency has identified three priorities for the economic, environmental and social progress of the region. They are: Improving the region’s productivity and promoting and actively working towards the growth of the market. Understanding and nurturing the conditions for sustainable growth Working towards promoting the size of the total workforce of the area and improving their capability levels. Some of the major achievements made by the NWDA are: Collaborating with the sub-regional partners and local agencies to bring in an investment worth £120m which is expected to produce 400 new job opportunities by the end of this year. Expansion of the functions of the Bank of New York in Manchester. This will bring in an additional 750 job openings. Merseyside is expected to receive an investment worth £3 billion. The region’s Climate Change Action Plan is aimed at promoting the progress of the North West region towards a low carbon economy. This action plan has already witnessed several excellent initiatives and is now working towards identifying gaps in the progress and prioritizing future activities. Regeneration of Liverpool’s waterfront to convert it into a flourishing city region. Marked progress has already been noted in this 10 year plan. This region is expected to derive Remarkable progress in biotechnology. The region has more than 230 biomedical companies using the latest cutting edge technologies for stem cell and DNA research. Despite all this progress, the gross value added per head is lower than the country’s average by 12%. This has resulted in an output gap of £13 billion. According to the Independent Performance Report of the North West Regional Developmental Agency in June 2006, though 150,000 fresh jobs have been generated, “the region compared to England as a whole has; 80,000 fewer people working, 120,000 more people with no qualifications, 80,000 fewer people with degree level qualifications, 90,000 fewer people working in the knowledge economy and 38,000 fewer companies.” (North West Regional Developmental Agency, 2008). To overcome these hurdles the NWDA has set ambitious targets for the period 2006-2009. It aims at achieving a GVA growth which is higher than England’s average. It also aims at generating 150,000 new jobs out of which 80,000 will be “knowledge” based occupations. It will ensure that no district in the area has more than 29% of the population with no qualifications which means a greater thrust will be given towards education. Once NWDA reaches it targets and comes at par with the national average, it aims towards having a higher proportion of workforce employed in the knowledge based sector and more number of graduates in the workforce compared to the rest of the country. NWDA plans to achieve this goal by 2026 or even earlier. . The East of England Regional Development area comprises of Bedfordshire, Essex, Hertfordshire, Cambridgeshire, Suffolk and Norfolk. Besides these there are also Luton, Southend-on-Sea, Peterborough, and Thurrock. This region had been inhabited by humans since the Stone Age. Flint mines from the Stone Age, Roman strongholds, medieval architecture and modern structures; this region has everything that is needed to make it a favourite historical tour destination. Nature has also been generous to this part of England. It has miles of beautiful coastline and stretches of open green countryside, natural reserves and parks. Tourism therefore, forms a major industry of the East of England. The area boasts of seven major seaports including Felixstowe. It is also well connected by rail, road and air. The airports at Luton and Stansted connect it to the rest of the world. Strategically too, this area is placed close to London, one of the world’s busiest financial hubs. This region is home to five top universities of the world, including the famous Cambridge University. According to the facts and figures available at the East of England website, dated April, 2008, There are 430,000 businesses in the area. GVA of 109.9 billion pounds which is about 9.7 percent of the country’s total GVA The average per capita GVA of UK is 18,631 pounds. Compared to that, East of England has a per capita average GVA of 19,599 pounds. The number of children living in workless households in the East of England during the second quarter of 2007 was 14 per cent. This was 2 percent less in comparison to the rest of UK. This area has witnessed major economic and social developments since 2004. Some of these include: Increased number of businesses: Between 2004 and 2007, this area has gained 10,000 more businesses. Increased employment: There has been 90,000 more employments during the same period. Increased exports: Exports have also increased by 1.8 billion. Increased in number of qualified workforce: The number of highly qualified members of the workforce increased by more than 10,000 between 2005 and 2006 itself. Increase in GVA: The residence-based GVA increased from £101 billion to £110 billion between 2004 and 2006. At the same time the workplace-based GVA grew from £91 billion to £99 billion. Increased investment in R&D: Between 2004 and 2006, the investment in R&D rose from £2.7 billion to £3.6 billion. New living quarters: There has been remarkable progress in the provision of new living quarters in the area. Provisions for new dwellings increased by an additional 21 percent per annum and 72 percent of new dwellings were built during 2006 and 2007. The Independent Performance Report has lauded the East of England Development Agency for “Performing Well” and has given it 15 points out of a total of 24. The East of England Development Agency Annual Report and Accounts, 2007-2008, provides the following figures to underline what the agency has achieved for the area it represents: EEDA’s key achievements, 2007/08: • 4,927 jobs created or safeguarded • 41,274 people with improved skills • 1,480 businesses helped to start and grow • 34,918 businesses performance improvements • 52 hectares of brownfield land reclaimed • £134 million leveraged in public and private investment. EEDA’s financial performance: • £132 million spent on programme activities • full utilisation of cash resources available from Department for Business Enterprise and Regulatory Reform (DBERR) • all outputs either reached or exceeded target range • over £3 million of cashable savings achieved • overall efficiency targets exceeded • £134 million leveraged in public and private investment. However cheerful the picture may seem, there are many challenges that face the RDAs. Stakeholders, politicians, businessmen, and common people alike have started raising questions about the functioning and viability of RDAs in the present structure. Though politicians and local businessmen in some regions such as Yorkshire and NWDA, have praised the strategies adopted by the agencies, some RDAs like West Midlands, “have been openly criticised by council leaders for their lack of direct local accountability, the quality of their decision-making, and their project management.” (The Future of Development Agencies by Adam Marshall) “Attitudes towards the overall performance of the NWDA are very positive. Three-quarters of all stakeholders (73%) are satisfied, although more are fairly rather than very satisfied (52% and 21% respectively). Just eight per cent are dissatisfied, giving an overall net satisfied balance (satisfied minus dissatisfied) of +65 percentage points. One in six (17%) are withholding judgement, saying they are neither satisfied nor dissatisfied.” (North West Development Agency Report, Stakeholders Views of RDAs Pilot National Survey) However, the greatest concern is that though the RDAs were formed with the primary objective of reducing the gap in the growth rates of different regions in the country and focussing on the improvement of their economic performance, only minimal progress has been made in this direction. The disparity in economic conditions between the North and the South are glaring! If someone argues that the gap has reduced slightly in recent years, it needs to be noted that this is a result of slower growth in the Greater South East than in accelerated growth in the backward regions. Also, over the last five years, the East of England has experienced a slower economic growth rate in comparison to the national growth rate. There is a marked lack of accountability among the RDAs. They often consider themselves to be business-led organisations and not public sector government policy delivery agents. This fundamental point needs to be cleared if the RDAs are to be held accountable for their functions. The regions under an RDA are often too large to be managed efficiently. Most economic development plans do not match the sub regional real economies of the region. Therefore real concerns are often ignored. Economic development programmes should be tailored to fit the economic conditions, assets and needs of each specific sub region. If we take into consideration the East of England again, then we will notice that there has not been any substantial improvement in the sub regions. Therefore, unemployment and economic inactivity continue to be high in the northern and eastern periphery of the regions, specifically areas like Waveney in Suffolk, North and West Norfolk, and Tendring and Thurrock in Essex. There needs to be a greater collaboration between the different economic hotspots of the country. Now, Manchester and Leeds belong to two different RDAs and this inhibits the collaboration between the two. If we are to achieve a better economic growth in the North, then it is imperative that there is more collaboration between these two cities towards the uplift of the economy of the region as a whole, rather than focus on individual growth. Power should move to city-regions rather than stay concentrated in national and regional bodies. Statutory sub-regions could be given the power to make decisions based on existing resources for local capital infrastructure, planning and development. This would save unnecessary expenses. “Since sub-regions are made up of local authorities, planning decisions taken at this level would have direct democratic accountability through council leaders.” (The Future of Development Agencies by Adam Marshall) The PSA7 target has not helped at all but has only contributed in creating a lot of tension and confusion in formulating a proper regional policy. The endless comparison between regions and their performances have taken away the attention of the RDAs on their two primary objectives – increasing productivity and generating jobs. It would help if the PSA7 target was replaced with something which has a clearer vision and puts greater thrust on tapping resources that promise absolute growth and have the potential of generating more job opportunities. Though it is heartening to note that the Government has agreed to enact its regional and subregional proposals during 2009, it needs to come up with radical long term plans if it is serious about improving the regional economies of the country. Instead of nine different RDAs we should perhaps rethink the pattern and come up with lesser number of RDAs. A single development agency for the South or North of England should suffice if we focus on sub-regional economies and bodies to address the real economic concerns of a region and work towards dissolving the gaping economic disparity between different regions of the UK. Works Cited 1. Office of Public Sector Information (2002 – 2008) Regional Developmental Agencies Act 1998 available from http://www.opsi.gov.uk/Acts/acts1998/ukpga_19980045_en_2#pt1-pb2-11g4 [5 December 2008] 2. Regional Developmental Agencies Online (2008) Visit the RDAs available from < http://www.englandsrdas.com/> [5 December 2008] 3. Department for Business Enterprise & Regulatory Reform (2008) Regional Economic Development available from [5 December 2008] 4. Deas, Lain and Ward, Kevin G. (2000). “From the ‘new localism’ to the ‘new regionalism’? The implications of regional development agencies for city–regional relations.” Political Geography. (19) 273 – 292. 5. Jones, Martin. (2001). “The rise of the regional state in economic governance: `partnerships for prosperity or new scales of state power?” Environment and Planning A. (33) 1185 – 1211. 6. United Kingdom Parliament (2003) Visit to the North West Developmental Agency available from [5 December 2008] 7. UK Trade and Investment (2007) How We Help Businesses available from [5 December 2008] 8. Roberts, Peter W. and Sykes, Hugh (2000) Urban Regeneration Thousand Oaks: SAGE 9. South East England Developmental Agency (2008) About SEEDA available from < http://www.seeda.co.uk/About_SEEDA/> [5 December 2008] 10. North West Regional Developmental Agency (2008) New and High Growth Business available from [5 December 2008] 11. South West RDA (2008) Business and Enterprise available from [5 December 2008] 12. East of England Development Agency Facts and Figures available at http://www.eeda.org.uk/266.asp [April 2008] 13. East of England Development Agency The Purpose of Regional Economic Strategy available at http://www.eastofengland.uk.com/res/57.asp [17 December, 2008] 14. The East of England Development Agency Annual Report and Accounts, 2007-2008 15. West Midlands Regional AssemblyStrategic Review Group – 25 April 2007, Independent Performance Assessment of Advantage West Midlands 16. North West Development Agency Report, Stakeholders Views of RDAs Pilot National Survey 17. The Future of Development Agencies by Adam Marshall. Center for Cities. Available at: [17 December] he want to see my opinion with analysis of performance and effectiveness data and at the end some conclusions!He wants me to enhance critical evaluation! i)Description of role and responsibilities (you cover that)[25%] ii) Identification of contribution to delivery of physical regeneration (you didnt mention enough for that ) [25%] I am not sure about this. iii) Appreciation of performance and effectiveness (need more about that as well) Will add shareholders’ opinion. iv) Critical assessment and conclusions (and for that needed much as well) [20%]! Also he said to use another Case Study for better evidence and comparison, and he said to enhance critical evaluation! Take a case of development by NWDA and compare with another RDA. Will take up East of England as a comparison. http://www.eeda.org.uk/ http://www.eeda.org.uk/search.asp?search=breckland&page=5 http://www.eeda.org.uk/res.asp Read More