The role of the public sector in regeneration

So is the Government's "Levelling Up" White Paper new hope or the same old rope? Chris Plumley and Stuart Brown explore this latest policy in the context of the vital role the public sector already has in delivering regeneration and renewal.

The White Paper sets out the Government's plans for the levelling up agenda across the UK, and it is clear that a key focus will be on the delivery of quality housing and wider urban regeneration. Indeed, two of the six "capitals" underpinning the White Paper's proposals focus on "physical capital" (such as housing) and "social capital" including the strength of communities, relationships and trust which are key outputs from a successful regeneration project. 20 towns and city centres in England will benefit from this with Wolverhampton's urban corridor (£20m) and Sheffield's transport integration (£37m) announced as the early beneficiaries.  

The launch of the White Paper coincides with the launch of the Government's £2.6bn UK Shared Prosperity Fund. The White Paper sets out that this fund will be used to "restore local pride across the UK by focussing investment on three main areas for investment: improving communities and place, people and skills, and supporting local business".  

Whilst the UK Shared Prosperity Fund brings many opportunities, it will not in itself be sufficient to deliver the levelling up agenda, and the White Paper highlights several other funds which will be available to support the delivery of the proposals. This funding goes to local councils as well as various combined authorities. The funds include:  

• the Levelling Up Fund;
• the Brownfield Fund – the Government has already identified new "transformative" regeneration projects to be priorities within this £1.5bn fund.
• the Global Britain Investment Fund; and
• the next generation of the British Business Bank Regional Investment Funds.

European development funding is no longer available, so the UK Shared Prosperity Fund is intended to allocate funding to every place in the UK. Slightly controversially, it is argued that even the most affluent areas contain pockets of deprivation which will need to be supported through the levelling up agenda. This is a departure from the norm in terms of how funding is allocated (where grant recipients tend to bid for allocations), and this raises the question as to whether this funding will be focussed on the right areas of deprivation across the UK. There has previously been criticism of the "bidding" process as those councils with already limited resource are less likely to be successful. Could that mean that those with the poorest or most in need areas are missing out? Time will tell. Councils and combined authorities are pressing ahead with regeneration schemes so hopefully these new funding streams will only add increased viability and attraction for private sector partners. 

To access their allocation (full details of which are yet to be released), places will need to demonstrate to the Government what measurable outcomes they are intending to deliver. We have seen an increase in activity with our public sector clients in business planning and feasibility studies leading up to the market engagement stage. Maybe then the early focus on scheme outcomes and viability will help the schemes to reach maturity? It is yet to be seen whether those areas with a real need for funding will have the officer and financial resource to fulfil these allocation requirements and obtain sufficient funding to support their levelling up agendas. As projects are brought forward, the sector will need to keep under review how the levelling up agenda and its processes sit alongside other features of regeneration. Will they unlock the regeneration pipeline or add to the bureaucratic burden? 

The White Paper tries to address this and focusses on the departure from the bureaucracy which was often perceived to surround the old EU regional funds, and highlights that there will be an ability to point funding towards local priorities. This includes the ability to focus on supporting local businesses, and ties in with the Government's wider policy objectives across the public sector (including the ability for contracting authorities to reserve below threshold contract opportunities to suppliers based in a certain geographic area, or for SMEs and VCSEs under PPN 11/20, as well as the national priorities set out in the National Procurement Policy Statement in PPN 05/21, such as the creation of new businesses, new jobs and new skills).

Targeted funding and a supportive policy background can only help take things forward. For all of this to succeed, however, the public authorities at the heart of this programme will need the recourses, officers, time, skills, cross party member support, professional advice and the drive to deliver ambitious life changing schemes. Let's hope all of this comes together.

Chris Plumley is a partner and Stuart Brown is an associate at Trowers & Hamlins.