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Area Based Initiatives (Cornwall And Scilly)

Volume 400: debated on Wednesday 26 February 2003

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11 am

I am delighted to have secured a debate on this important subject. I know that the Minister has a deep knowledge of it because she has been involved with her Department's work addressing the complexity of the area-based initiatives that come down from the Government. It is hard to imagine that the subject will be the stuff of tabloid headlines, although I argue that it is of deep concern to many people throughout the country. However, the terminology and the complexity of the subject make it impenetrable to many for whom it is important.

As the subject is unlikely to attract gladiatorial debate and argument, I hope that the Minister and I will be able to generate more light than heat in our debate. Given the Government's efforts and the work of the regional coordination unit—and before that, the performance and innovation unit—on area-based initiatives, I suspect that the Minister and I might be pursuing a similar agenda; I certainly hope so. I hope that she does not think that she can bat away my worries as ingratitude because I, and the people of Cornwall and the Isles of Scilly, are grateful to the Government for recognising the social exclusion that exists in the communities—in other words, poverty and deprivation. Those worries are being addressed in several ways and I am grateful for the effort, focus, priority and finance that have been seen. I am also grateful to the partnership of the communities, those who are deprived, the Government, and MPs in securing objective 1 status a few years ago.

When defining area-based initiatives, I shall include the objective 1 programme because it is relevant and knits together with many of the programmes that we shall discuss. Although there have been entertaining attempts to rewrite history and claim credit for achieving objective I status, a partnership did that. The people themselves championed the campaign for the designation, statisticians recognised the distinctiveness of Cornwall, which achieved statistical separation, and the Government campaigned successfully in Europe to drive home the advantage so that we got the designation. The Minister and I may share success, but we also share an interest in getting things right.

What do we mean by an area-based initiative? I know that the Minister knows but, for the record, I shall use a definition from a Government document. It is a measure
"to tackle social exclusion and deliver improved services in the most disadvantaged areas."
That quote comes from the regional co-ordination unit's "Review of Area Based Initiatives", which was published in October 2002. For example, among the many initiatives in Cornwall are: objective 1 integrated area plans, single regeneration budgets, neighbourhood renewal programmes, health action zones, healthy town initiatives, healthy living initiatives, market town initiatives, vital villages, sure start, Cornwall action team for jobs, the neighbourhood nursery scheme, the partnership development fund, the skills development fund, the rural key fund, the rural renaissance initiative, the community champions fund, community chest, the community empowerment fund and the safer communities initiative. Simply by listing the initiatives and their titles, I make the point that I believe both the Minister and I understand. In the regional co-ordination unit report of October last year, Cornwall was cited as an example of where the plethora of initiatives was creating problems. The situation was not created by God, as if it were something natural. It is unnatural; it is manmade, so we can do something about it. The report identified more than 100 partnerships operating in Cornwall. All those are run at the same level by professional bodies.

It is my estimate that, taking all the partnerships together and including objective 1, we are looking at a budget of about £650 million to be spent in Cornwall over the next five years. That includes match funding, which inevitably has to be matched with other money in many of those programmes.

The primary point that I wish to make—I sent a note to the Minister's office to make clear my questions—is that although I am grateful for the funding, as many people are, the system that has been created has resulted in confusion and bewildering bureaucracy. Far from generating initiative, it has created initiative fatigue, strategy fatigue, vision fatigue, mission fatigue and fatigue within communities. There is a barely disguised intolerance of the confusing array of jargon and bureaucracy, which people find almost impossible to penetrate. I think that the Minister will have some sympathy with that point.

What action have the Government taken? I appreciate that they have identified the problem. The study in 1999 by their performance and innovation unit resulted in the report "Reaching Out—the role of central government at regional and local level", which was published in February 2000. It resulted in further work by the regional co-ordination unit and its report "Review of Area Based Initiatives", published in October last year. In that report, the unit accepts the problems of partnership overload, increased bureaucracy and the lack of integration of many of the schemes. There are many problems, not least the number and complexity of area-based initiatives in areas such as Cornwall. The different time scales and requirements of each of those do not dovetail well.

So far, where there have been partnerships, the response of the Government has been to set up local strategic partnerships. We now have partnerships for partnerships and that local strategic partnership has to produce a strategy, so that is a strategy of strategies. We now have super-partnerships and super-strategies, creating another layer of bureaucracy on top of the existing layer. We have the problem of duplication. Each partnership tends to create its own bureaucracy. Many of the organisations that I am talking about have facilitators and their own strategy and administrative procedures. all of which add to the web of bureaucracy that people have to face.

There is also the issue of perverse outcomes, such as different interpretations of state aid rules by, for example, the neighbourhood renewal fund and the single regeneration budget. Many of those people in local government who were consulted before the debate say that the interpretation of state aid rules on projects that are coming forward are not always consistent across all the programmes. Another example of a perverse outcome is when two Government initiatives result in competition for the same funds and, in effect, suppress one potential outcome.

I shall give an example of a market town in Cornwall. I have to be careful about this. The private sector body funded under the neighbourhood nursery scheme through the Department for Education and Skills is competing with sure start, funded by the Department of Health. Both are trying to set up pre-school provision in the area, competing for the same public funds. Because the public funds are limited, only one of them will be successful. That is an example of two bureaucracies being established, which compete to attain the same objective. The outcome is perverse, resources are wasted and there is a duplication of effort. That is happening on manifold occasions throughout Cornwall in many of the initiatives that I have mentioned.

There is also inefficiency. The regional co-ordination unit report states that the audit bill of Kerrier district council has quadrupled in five years as a result of the work done by that council to prop up its commitment to the bureaucracies and partnerships with which it finds itself engaged. The same professionals turn up to different committees under different titles and frantically run around keeping all the balls in the air to maintain their involvement in the partnerships in each of the initiatives.

Under community regeneration in objective 1, the Cornwall Voluntary Sector Forum, Cornwall rural community council and the diocesan Board for Social Responsibility in Truro produced a report identifying that the £4 million for community regeneration under objective 1 is being spent largely on bureaucracy establishing the integrated area programmes and producing the strategies, but very little is being achieved on the ground. One response from Richard Bayley, the Plymouth director of the Government office for the south-west, questions the bulk of the money used for regeneration in Cornwall going into bureaucracy and strategy. Some of the money goes into what is euphemistically called capacity building.

The most useful capacity building that can be undertaken, however, is to teach local communities and give them the knowledge to negotiate the systems created by the Government. It is assumed that poverty is caused by the incapacity of the people and communities rather than geography and economic circumstances beyond their control. In fact, the capacity building that is required is the building of the knowledge and confidence to become cynical of the whole process in order to extract money from the system. Many community organisations find that the best way forward is cynically to manipulate the system because there is no other way for them to obtain finance from the system to allow community groups to prosper. There are many reasons for concern about the way in which area-based initiatives operate, but I do not have time to go into detail about the other impacts.

In discussing social exclusion, we are talking about poverty. The poverty industry is now one of the most prosperous in Cornwall. I am sure that, to an extent, targets have been met and the poor are benefiting, but a tremendous bureaucracy has been established through which the money and effort must be driven in order for the poor in Cornwall to benefit significantly. As a result, there is a great deal of initiative fatigue and barely disguised intolerance on the part of those involved.

I have asked the Minister several questions in advance of today's debate. For example, what estimate has been made of the amount and proportion of available funds for Government-agency-sponsored area-based initiatives that has been spent on productive purposes to deliver goods on the ground? How much has been employed for non-productive, preparative, administrative, team-training capacity-building activities? Has the Minister's Department estimated the impact of such a high number of area-based initiatives on Cornwall and the productivity of those initiatives? Are there more effective ways to reduce the non-productive costs of running those schemes? By what measures do the Government estimate the success of ABIs in satisfying their own targets and the targets of local authorities? When will the Government stop adding to initiatives and mainstream the successes? Are local strategic partnerships here to stay, or are they another short-term experiment? If so, what does that tell local authorities about Government attitudes?

In conclusion, if we got rid of the middle person and took the bureaucracy out of the system, we would be able to distribute some £650 million across, let us say, 10 per cent of the population, and give each poor family in Cornwall about £10,000 a year. If we gave it to them in vouchers to buy child care, security or better housing they would spend that money in an effective way. Rather than going through processes that are about greater control, perhaps the Government need to let go.

Cornwall county council has recently been given an excellent billing by the Government for the way in which it runs its services. If it is so excellent, and the Government are in favour of devolution, perhaps it is time that the Government gave Cornwall county council and other local authorities the opportunity and freedom to run these programmes themselves.

11.16 am

The Minister for Social Exclusion and Deputy Minister for Women
(Mrs. Barbara Roche)

I appreciate the way in which the hon. Member for St. Ives (Andrew George) has introduced and conducted this debate. He is quite right: we are speaking about serious and important issues. He and I have had long discussions about Cornwall and objective 1 during the process of negotiation.

I want to speak about the policy thrust behind the area-based initiatives, and about how these initiatives are working on the ground. I hope to give the hon. Gentleman some comfort that we are making progress in eliminating bureaucracy and amalgamating initiatives where we can. I agree that we do not want to have cumbersome bureaucracy standing in the way of delivery.

The policy thrust in delivering area-based initiatives is to narrow the gap between deprived neighbourhoods and the rest of the country, so that within 10 to 20 years no one should be seriously disadvantaged by where they live. It is unacceptable that those living in our poorest communities so often have the worst schools and public services. Our aim is to deliver economic prosperity, safe communities, high quality education, decent housing and better health to the poorest parts of the country.

Area-based initiatives have a key role to play in reaching that aim. They are important for trying out new ideas and giving scope for innovation. Across the country, the Government are investing around £2 billion over 10 years in the 39 new deal for communities areas; some £1.9 billion over five years through the neighbourhood renewal fund in the 88 most deprived areas; and some £500 million in 522 sure start programmes.

Cornwall and the Isles of Scilly include some of the United Kingdom's most deprived neighbourhoods. Earnings in Cornwall are 33 per cent below the national average. Coping with the impact of economic changes on the traditional industries of fishing, agriculture and mining has been a painful experience. Overall unemployment in Cornwall has come down to around the national level but remains persistently high in some areas. There has been a hard-fought campaign in Cornwall to bring those areas to attention at national and European level.

As the hon. Member for St. Ives amplified, Cornwall has almost the full range of United Kingdom Government area-based initiatives, as well as some very significant European funding: that is because of the great difficulties that communities in Cornwall face.

Objective 1 is bringing in £308 million of European money to raise the economic prosperity of the area. That is also levering in other public and private sector funds. That is achieving a considerable amount: it is supporting projects delivering broadband, which is important for Cornwall's regeneration; it is providing venture capital to business, which is vital because we need to stimulate the growth of small and medium-sized enterprises in Cornwall; it is also supporting the additional activities of such marvellous ventures as the Eden project, which is having a big impact on the local community; and it is expanding Dairy Crest's creamery in the area. All of those things are very important.

The hon. Gentleman mentioned bureaucracy. I am sure that he agrees that there must be a robust process for project appraisal, because significant sums of public money are at stake. However, we try to ensure that that process matches the size and nature of the projects. I assure him that I will keep a vigilant eye on that. If we are dealing with a comparatively small sum of money, we must ensure that the due diligence that we have put in place is not excessive. Several projects that are under way provide funding for small-scale activities: they have been specifically designed to make access to funds as simple as possible for community bodies, small and medium enterprises and farming and fishing businesses.

The Minister rightly points out that due diligence is required, and that there must be a robust audit of how public funds are spent and whether they are spent properly. However, given the plethora of sizes and scales of operations and the numbers of initiatives, does she not accept that it would be far better to devolve the responsibility for that task to one organisation that is accountable to the local community than to have the current manifold arrangements?

I have some sympathy with the sentiments that lie behind that point, and I will address it as I develop my arguments.

The neighbourhood renewal fund brings an extra £5.5 million to the districts of Penwith and Kerrier. The fund aims to improve core public services and narrow the gap between deprived neighbourhoods and the rest. A new NRF-supported minor injuries unit at the Camborne Redruth community hospital will save residents of Cornwall's largest built-up area the 30-mile round trip to Truro. That is a good example of how things are made to work on the ground. The community contribution to that project was particularly impressive.

The hon. Gentleman mentioned the mainstreaming of services. The health action zone aims to improve local healthcare services. I will come on to how we have mainstreamed some of the principles that lay behind health action zones.

The Camborne/Pool/Redruth success zone is raising the aspirations and employability of young people from three to 19 years of age who live in the former mining area. Its projects include a hi-tech classroom of the future and work-based, accredited, key-skill qualifications. I am sure that the hon. Gentleman agrees that those are key examples of what is happening on the ground.

The hon. Gentleman mentioned sure starts. There are six sure starts in Cornwall, including two in his constituency. They aim to give children the best possible start in life and some of the things that they are doing, such as establishing fathers' groups and child minding networks, are key to ensuring that delivery goes where it is most needed—to the local community. Many more activities are going on.

Let me deal with the important points about complexity raised by the hon. Gentleman. He was right to say that we need to consider the difficulty, raised in the report of the performance and innovation unit, of there sometimes being a plethora of initiatives and too much bureaucracy. We have done so; indeed, we have been quite radical. I led a review of our area-based initiatives, and I recognise that there are too many funding streams and sometimes a lack of integration in Whitehall. We realise that we need also to mainstream many initiatives. A good idea that has been exploited in an area-based initiative should be transferred to mainstream services. There is too much red tape, with each programme having its own rules and its own monitoring and evaluation requirements, which makes it difficult for local people to access funding.

The regional co-ordination unit looked at 40 initiatives in eight reviews. I announced the results in October 2002. That led to a significant reduction in the number of separate funding channels. We have cut bureaucracy, and we are trying to champion change from the bottom up. The Government office is now developing single local management centres to work up proposals for the better co-ordination of area-based initiatives locally, and to identify the changes required at Government level to help ABIs focus on delivery.

The hon. Gentleman was right to talk about the county council. We want to include councils in the process and to give them more freedom and flexibility.

I appreciate the attempt to bring these initiatives together in the Government office. I welcome the fact that they are being brought together, and the involvement of the county council and other councils is also welcome. However, does the Minister accept that it would be far more acceptable to local people if that responsibility was devolved to a democratically accountable local body like the county council rather than being held out of Cornwall in either the regional development agency or the Government office for the south-west? With the best will in the world, those bodies are less approachable and further from the people who are supposed to benefit from the schemes.

But that is exactly what we have done with the establishment of the local strategic partnerships, which are here to stay. We have given them direct control over the neighbourhood renewal funding. That is a real partnership between community groups, the local statutory bodies that deliver the services and the local authority. We are keen to develop more local flexibility.

Much good work is already going on in Cornwall. The west Cornwall local strategic partnership has begun work on bringing together the ABIs in the Penwith and Kerrier districts—exactly what the hon. Gentleman seeks. The Government office's objective 1 team and the regional development agency are working on joint application forms and the joint appraisal of projects. Work is under way better to link the objective 1 integrated area plan teams with other initiatives. A great deal is going on. We also want to see a strengthened role for local strategic partnerships in directing the initiatives and funds towards deprived areas, and much more mainstreaming of good practice. I assure the hon. Gentleman that we shall be keeping a close eye on that, as the Government office seeks to develop those ideas further with all our partners in Cornwall.

Local strategic partnerships in Cornwall as elsewhere are taking a key role in promoting the effectiveness of area-based initiatives. There are now some 326 established LSPs in England. It is still early, but it is clear that they are starting to become effective in coordinating neighbourhood renewal. The thrust of local strategic partnerships was to cut the plethora of separate partnerships; they were doing important and worthy things but it was leading to partnership overload. Experience shows that they are having some success.

The Government remain committed to reducing the gap between deprived areas and the rest. We are confident that the area-based initiatives will lead to progress and to the renewal of our communities. I assure the hon. Gentleman that we will also reduce bureaucracy and red tape by bringing those initiatives together, and that we shall seek to ensure that they are delivering on the ground to the communities that need them most.

11.29 am

Sitting suspended until Two o'clock.