The British Property Federation, Nathaniel Lichfield & Partners, and the All Party Urban Development Group have launched a report “Going for Growth”, which appraises the effectiveness of various government projects to stimulate growth.
Current government initiatives range from Enterprise Zones and Tax Increment Financing to City Deals and a more coordinated approach to the release of public land. As the General Election approaches, the report assesses how well these schemes are working and the extent to which they might need to be modified, further developed, or even replaced.
The report has focused on the extent to which Government initiatives have stimulated development activity. While it is accepted that economic growth does not always require new development, there are many areas where economic growth cannot be delivered without a supportive increase in development. There is, therefore, a strong public policy interest in helping to remove blockages to development, where it can help stimulate and support economic growth.
Chair of the All Party Parliamentary Group for Urban Development Paul Uppal MP explained:
“Governments can always learn and as we look beyond 2015, this report gives a vital insight into what has succeeded and how we can build and improve upon the growth initiatives this Government has put in place.”
The principal recommendations of the report are:
1. Improve coordination and evaluation across the range of initiatives
An expert resource within central government is needed to act as a point of contact for local authorities, to help them connect the many different strands of local growth funding, policy-making, and implementation, and join up various funding streams more effectively.
The government should also develop a shared evaluation mechanism for all growth initiatives as a priority and apply its framework rigorously.
2. Improve the offer in Enterprise Zones and gear them more closely to local conditions
Government should reappraise the ‘offer’ in Enterprise Zones to become more bespoke and provide incentives geared to the specific circumstances of individual Zones
3. Use Tax Increment Financing more constructively
Government should learn lessons from the successful use of Tax Increment Financing, to inform how it can be applied to other areas where the lack of upfront infrastructure expenditure is the key barrier to progress.
BLP Insurance Chief Executive Kim Vernau, said of the report:
“The effectiveness of the Government’s initiatives to stimulate and rebalance economic growth will be crucial to helping the UK’s construction industry move forward. The initiatives will continue to be a core element of any UK Government’s economic growth policy, and with the General Election around the corner it is a good time to make sure that they are delivering as planned.
“Enterprise Zones, Tax Increment Financing and City Deals have sought to empower City Councils with the tools to stimulate and encourage economic growth in their cities, accompanied with financial assistance for long range urban renewal projects. If successful, this should be a significant step in helping to address the imbalance between the South East and the rest of the country.
“As availability of land continues to hinder construction growth in the UK, the Government’s initiative to provide a more coordinated approach, both in terms of the effectiveness and efficiency of the release of public land, should also serve to help promote economic growth across the country.”
By David Mote, Editor