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Sainsbury’s Roadworks (Belgrave, Leicester)

Volume 587: debated on Thursday 6 November 2014

Motion made, and Question proposed, That this House do now adjourn.—(Gavin Barwell.)

I am most grateful to the House for the opportunity to raise the important matter of the roadworks in Belgrave, Leicester. I am delighted to see the Parliamentary Under-Secretary of State with us this evening, and I thank her for being here.

The Belgrave road is known as the “Golden Mile”. Not only is that description known throughout the city, but its reputation is national and international. People come from every part of the world to this shopping hub, with its vibrant community, unique atmosphere and specialist stores: whether for saris at Saree Mandir, Ladlee or Milans; to buy the most delicious sweets made in Britain at Sharmilee or Bobby’s; or to shop at local stores such as Radia’s. I can remember the day I first set foot on this road, the day after being selected as the candidate for Leicester East in June 1985. I was struck by its charisma. The House will understand, therefore, why the road is of such significance to me and to Leicester.

Unfortunately, the Golden Mile is being tarnished by Britain’s second biggest retailer, Sainsbury’s, once affectionately known as the nation’s grocer. The roadworks it agreed to carry out have been repeatedly delayed and appallingly managed, leaving the area at certain times impassable. This is not some cul-de-sac, but an arterial road to Nottingham and a gateway to Leicester, the eighth and 12th-largest cities in the United Kingdom.

I have received hundreds of complaints and criticisms about how Sainsbury’s has dealt with this issue. We are dealing with a company that recently announced profits that have risen to £898 million. By the end of this debate, it will have made a further £50,000 in profit. Its customers are the people of the United Kingdom, but those in Leicester are being treated with contempt.

A deal was made between Leicester city council and Sainsbury’s in 2011 that gave Sainsbury’s planning permission for a new megastore in Rushey Mead. This section 106 agreement allowed for the alteration and improvement of highways around the Belgrave circle, with Sainsbury’s paying for the works. From the very beginning, there has been a lack of openness about how the proposal from Sainsbury’s was received and how this agreement was reached—for example, we have never been given firm answers regarding costs. I have made a freedom of information request for the relevant correspondence between Sainsbury’s and Leicester city council, but it was refused by the council, and I have subsequently appealed. I am prepared to go all the way on this. This was a simple request and can be easily found with a keyword in a search engine. Why is my request being blocked?

The proposals to demolish the flyover were initially welcomed, because of assurances by Sainsbury’s that the works would be completed in a short time and to a set timetable. The community, local councillors and I saw this as an opportunity to regenerate the area, because we accepted Sainsbury’s cast-iron guarantees. Unfortunately, however, Sainsbury’s has focused little of its attention on ensuring that the agreed local authority developments are completed to the agreed time scale, which has resulted in the chaos in Belgrave. Its focus has been elsewhere—at the bank.

At the other end of Belgrave road towards Rushey Mead, Sainsbury’s managed to open its new store exactly a year ago, causing huge disruption to the people and businesses of Rushey Mead. It seems where profits are concerned, Sainsbury’s, sadly, has little interest in the communities it operates within. However, the most protracted problem with the developments has been the completion of roadworks following the demolition of the Belgrave flyover. The flyover has long been seen as a dividing line between Belgrave and the city centre.

The demolition began on 15 February this year, with a publicly consulted “short” timetable of nine weeks. The disruption to the area was considerable, but the public put up with it because it was the right thing to do for that short period. To his credit, the mayor, Sir Peter Soulsby—whom you will remember, Madam Deputy Speaker, as a former Member of this House and to whom I pay tribute for his vision and strategic approach—was right to suggest that the flyover should come down for the long-term benefit of the Belgrave area. He wants one city, without artificial dividing lines. Local people have subsequently told me that, without the shadow of the flyover, their homes now see daylight.

That period of disruption would have been tolerable as a necessary part of the wider deal if subsequent developments had been completed as agreed by Sainsbury’s. Instead, it has had a catastrophic effect on businesses and residents. The gridlock has been damaging for stores at one of the busiest times of the year. Only this morning, I heard Tricia Castaneda, of the Bridle Lane tavern, which is just in the Belgrave area, on Radio Leicester. She said that she had lost £40,000 in trade as a result of this disaster. Pitched as an opportunity to dramatically improve links from Belgrave road to Leicester city centre, the subsequent and ongoing road works have been exactly the opposite. Sainsbury’s announced in January that the majority of the works would be completed in October, in time for the Diwali celebrations. Leicester has the largest Diwali celebrations outside India. Some 20,000 people travel to the Belgrave road from all over Europe to see the best lights outside Mumbai being switched on, so this is no small meeting. It is genuinely a big deal.

The management of the scheme has been a disaster. The works will not now be completed, we are told, until March 2015. The oversight of the project has been hopelessly managed, with Sainsbury’s representatives failing to monitor the progress of Longcross, the contractors. What an extraordinary contract Sainsbury’s entered into with Longcross, which had already caused disruption in Rushey Mead. It faces no penalties for delays to the Belgrave project, removing any urgency to complete the works on schedule. From the perspective of many residents and businesses, it seems that for three months this year nothing happened at all. I am sure that Members will agree that there is nothing more irritating than queuing at road works, only to find nobody actually working there.

The primary interlocutor between Sainsbury’s and the community was a man called David Mills, whose impressive title is head of property communications—an odd title, which implies that property can talk. Sadly, he has not been the best possible ambassador for Sainsbury’s. Mr Mills has overseen an appalling lack of communication with the people of Belgrave, as he and his colleagues have failed repeatedly to meet members of the public. Indeed, an attempt to hold a public meeting on 7 October almost ended in farce, when Mr Mills sent my office in Leicester an e-mail confirming his attendance and then rang me to say he could not attend, as the city council had told him not to. That was subsequently found not to be the case. Not only had the mayor said no such thing, but he himself attended the meeting on the seventh, listened carefully to the public’s concerns and was congratulated for doing so.

Sainsbury’s has also failed to keep residents or businesses informed of the delays, nor has it explained the slow progress, the main cause of inconvenience and loss of trade in Belgrave. If Sainsbury’s thinks that is acceptable, it is off its trolley. The retail giant’s defence to the charges has been to point to a series of complicated letters and leaflets that it claims to have distributed around Belgrave, and to the hotline that it has provided. In my view and that of local residents, working in that way—and through its public relations firm, Gough Bailey Wright—was the wrong decision. It should have listened to local people by turning up to public meetings and hearing what they had to say.

In addition to those failings, the original development plans were changed without the public being properly consulted or, indeed, informed. Martin Fletcher, the head of highways at Leicester city council, has said that following the demolition of the flyover, the council “took stock” of possible changes. A decision was then made behind closed doors to add extra lanes to the planned roadworks. There was no logic to this decision. It was made without hearing what local councillors and residents wanted to say at public meetings. That ensured that the changes greatly worsened the already substantial transport problems in Belgrave. Most importantly, the council did not do what it should have done, which is to come to see local people and explain what it was doing.

The other council officer with a fancy title and large salary is Mr Andrew Smith, director of planning and transportation. Years ago, when I asked Mr Smith about the site in Rushey Mead, he told me that the matter was highly confidential and that he could not reveal any information about who was going to buy it. Eventually, behind the backs of local representatives and local people, the land was sold to Sainsbury’s. It is people like Mr Smith—with his inability to be open and transparent when asked simple questions, or to answer them with a straightforward answer—who give local government a bad name. I hope that he and his department will learn lessons from what has happened. We have still not been given any indication about what Sainsbury’s plans to do with its old site.

As you may by now have gathered, Madam Deputy Speaker, the whole community is united in its disappointment at how this matter has been handled. A few specific individuals have led the campaign of local residents and worked tirelessly to support residents and businesses. I want to thank Mr Dharmesh Lakhani, the chair of the Belgrave Business Association, Councillors Manjula Sood and Rashmi Joshi, Councillor—and now lord mayor of Leicester—John Thomas, former Councillor Mo Chohan, community spokesperson Ratilal Govind, and local business owners Suresh Gosai, Karan Modha, Atul Lakhani, Mehul Visram, Ruksi Patel, Rajinder Bhullar and Jayesh Mistry. My particular thanks go to the mayor, Sir Peter Soulsby, for always stepping in to help when we requested his support and for his unwavering commitment to the people of Belgrave.

The residents of Belgrave want this shambles to be resolved, and they want action to be taken. We need a clear timetable for the completion of the works, with an immoveable deadline of 31 December 2014. The roadworks should have been completed by that date. They have already ruined Diwali and Christmas for local people, and further delays should not be allowed to ruin the new year celebrations as well.

There should be full and complete compensation for the shop owners, who have suffered huge losses because of Sainsbury’s delays. That is an absolute necessity. Hanif Pirani, a respected solicitor, has offered to act pro bono to launch a class action against Sainsbury’s on this matter. In my view, that will be worth millions of pounds, and Sainsbury’s will need to open its till—probably all its tills.

There should be full disclosure of all correspondence between the council, Sainsbury’s and Longcross, including all correspondence prior to and following the agreement that has been reached. In view of Sainsbury’s conduct in Belgrave, there should be an immediate suspension of all current planning applications by Sainsbury’s, and not just in Leicester, because councils may want to do that in other parts of the country. There should be a full review of such applications and the promises they make. In my view, that would be highly prudent.

Most importantly, I believe the law needs to be changed, so that developers must carry out agreed community projects before they can complete their own developments. It may be that the law allows it at the moment, but we have not been told that that is so. In this case, Sainsbury’s has failed to fulfil its end of the bargain, and I do not doubt it will do so elsewhere.

Finally, let this be a warning to councillors and residents of every town and city that when Sainsbury’s comes knocking on their door with large smiles, offering to build community facilities, people should be very wary of accepting these assurances. People should beware of grocers bearing gifts. When leaving the negotiating table with Sainsbury’s, one should count how many fingers one has afterwards. Here, it has undermined community development to benefit its own agenda. I hope this sad story compels other local authorities to think twice before agreeing anything with this company.

The consequences of Sainsbury’s recklessness threatens to destroy one of the most important and successful shopping areas in Leicester. Rather than Sainsbury’s slogan, “live well for less”, local people in Belgrave are paying more for a lot less—and Sainsbury’s is living very well. Let this debate be a message that the local community in Belgrave is fighting back.

I congratulate the right hon. Member for Leicester East (Keith Vaz) on securing this debate on managing the provision of local infrastructure improvements necessary as a result of new development. He is particularly concerned about the management of new infrastructure in the Belgrave area of Leicester, following the demolition of a flyover and a former Sainsbury’s store, and about the ongoing construction of replacement road infrastructure as part of the mitigation works following the new Sainsbury’s development across town.

More specifically, the right hon. Gentleman’s concerns centre on the disruption and difficulties caused for residents and businesses, not only because of the apparent ongoing delays to those mitigation works, but because of an apparent lack of communication and information from those responsible for the works to those affected by them. Meanwhile, across town, the new Sainsbury’s store has been completed and opened for business.

The right hon. Gentleman calls for a change in the law to require such mitigation works to be completed prior to the completion of new developments that they were intended to mitigate. He will appreciate that I am unable to comment on specific planning cases, but I will briefly set out the situation as I understand it, having done some digging, and give him an outline of the general policy and legislation issues involved, which he asked me to do. At the end, I hope to give him a list of actions that he can take to ensure that his residents and business owners are appeased, which I am sure is the main reason for his securing this debate.

Sainsbury’s, I understand, is contributing several million pounds—the final amount is yet to be determined—towards new road infrastructure and a community regeneration scheme in the Belgrave area of Leicester. This funding is part of the mitigation agreed between Leicester city council and Sainsbury’s following planning permission for relocation of a Sainsbury’s store from Belgrave to Rushey Mead. The actual mitigation works are, I understand, being led by Leicester city council and Sainsbury’s in a partnership. I understand that delays have occurred to the construction of the new road but that this has at least partly been due to design changes agreed after discussions between the council and the community to increase the capacity of the new road by adding more lanes. Works are now scheduled to be completed in March 2015, having originally been programmed for last month. I fully understand the impact on the area of the loss of trade during Diwali and Christmas.

It is obviously vital that such changes and delays are clearly communicated to residents and businesses. Details of any potential compensation claimable, where appropriate, should be made available to those residents and businesses.

I understand that updates on the work have been communicated locally by Sainsbury’s and Leicester city council through a variety of means, including drop-in sessions, bulletins, and the helpline mentioned by the right hon. Gentleman. Clearly, however, that communication has not been adequate to keep people informed about the works, and about where they can have access to assistance and mitigation themselves. Crucially, I also understand that it is widely accepted locally that the works, when completed, will bring positive long-term benefits to the community, enhancing it and contributing to regeneration and growth.

As I have said, the details of measures involving the compensation that is potentially payable as a result of the work should be made clear to residents and businesses as part of Leicester city council’s overall communication strategy. That is good practice, and it clearly happens elsewhere.

The last time this happened with Sainsbury’s was in Rushey Mead. All that it gave residents there were Sainsbury’s vouchers worth between £5 and, I think, £25. Does the law permit the company to give more in compensation, or permit residents to ask for more?

As I proceed with my speech, the right hon. Gentleman will realise that I do not think that Sainsbury’s is the guilty party in this case. Responsibility for looking after the community and ensuring that compensation is paid—I can list a number of ways in which that can be done—lies with Leicester city council, and I think that the right hon. Gentleman would do best to focus his energy on that. If he looks up reports of Adjournment debates that I initiated as a Back Bencher, he will see that I am not shy about kicking big business when it does not do what it said it would do, but in this instance Sainsbury’s does not appear to have a case to answer.

I hope that what I say this evening will help the right hon. Gentleman to obtain some mitigation for his local businesses and residents. I can confirm that the Valuation Office Agency, which is responsible for business rates assessments, has already received a small number of claims in respect of the works. I am sure that the right hon. Gentleman will welcome the news that the agency will be speaking to businesses in the area shortly to establish whether rateable values should be reduced for all affected businesses. Local authorities, of course, have the powers given to them by the Government to vary business rates in areas that need particular help, and areas that they wish to regenerate.

There are practical options that the right hon. Gentleman can pursue. He has a reputation for being one of Parliament’s stellar communicators. I think that he should seize the initiative and use his skills to ensure that people have all the information that they need. I hope that I have helped to inform him of some of the routes that will enable them to receive compensation, and about the help that is available with business rates. Let me also direct him to the Great British High Street portal, which is a repository of good practice and ideas. It explains how high streets and town centres have helped to mitigate various problems. He will find not only inspiration but, probably, some contact details relating to people who have been in similar positions. Fundamentally, however, I think that the local authority needs to be a bit more on the ball and a bit more proactive in helping to mitigate the problems affecting its community.

The works at Belgrave are subject to a section 106 agreement between Leicester city council and Sainsbury’s. Section 106 agreements, more commonly known as planning obligations, are individual legal agreements between developers and local authorities. They are used to mitigate the impact of development for the benefit of local communities so that the development can be given planning consent. While subject to negotiation between parties, the obligation placed on the developer should address planning matters that are necessary to make development acceptable. That will often include time scales for completion of the works to be undertaken. In this instance, specific time scales for completion were not built into the agreement, at the council’s discretion. Because of the nature of the scheme and because the council felt that it might change, it did not include an end date for the works. It was perfectly able to do so under existing rules. However, an indicative completion date of October 2014 was agreed, and was, I understand, communicated locally, as was the extension to the works, which will be completed in March of next year.

The use of planning obligations is well established in the legislative framework of the Town and Country Planning Act 1990. It is a robust tool which allows authorities to obtain the appropriate mitigation for developments, and we do not consider that the changes suggested by the right hon. Gentleman are required. The council could, after all, have put in an end-date.

A blanket requirement to complete all mitigation prior to a new commercial, or other, development being completed would threaten cash flow, which, in many cases, would make development unviable. In some cases, mitigation will undoubtedly be essential beforehand, for safety reasons for example, and that is a matter for the planning process and the section 106 planning obligation.

When planning obligations are delivered successfully, the community gets the benefit of new and improved facilities, such as road improvements, affordable housing, education provision and open space, and the developer gets a balanced development, which serves the community effectively. Where developers breach the terms of a planning obligation, the local authority has powers to take legal action to enforce the obligation. A local authority also has the right to carry out the obligation itself and then recover any expense incurred from the developer in question. Sainsbury’s has done what has been asked of it. The city council already has a range of available options—although the last ones I have mentioned are probably not appropriate—but it certainly has tools at its disposal if it feels action is appropriate.

Planning obligations, and any subsequently agreed modifications to them, must be transparent and be made available to the public. This is a fundamental legal requirement. I am able to confirm that this requirement has been met in the case in question, the documents being available on Leicester city council’s website. However, beyond that simple requirement, it is clearly good practice—particularly when there are major works, such as those about which the right hon. Gentleman is concerned, which affect a large number of people—that those affected by the works are directly kept informed throughout the planning and construction processes. Most authorities have well-established procedures to ensure that this happens, and I am sorry that the right hon. Gentleman has had to resort to a freedom of information request to get the information he is seeking, but he is right to pursue that.

The national planning policy framework sets out very clearly the importance that the Government attach to community engagement in the planning process. We want communities to accept new development in order to allow growth, and their ability to see clearly the benefits it can bring is key. This Government have led the way on community involvement and engagement in planning. Neighbourhood planning offers a real opportunity for communities to plan positively for their area—an opportunity that is being grabbed enthusiastically with both hands, as there are now 1,100 neighbourhood plans in production.

We have also led the way on reducing planning delays and encouraging development on site to start. To support local authority capacity to deal with major schemes, the Government have implemented a 15% inflation-related increase in application fees from November 2012 and have continued to fund the advisory team for large applications and the Planning Advisory Service.

There are many other schemes and ways in which the local authority can raise capital to assist with development works, and I would be happy to write to the right hon. Gentleman with that information and let him know about them.

According to my investigation—my officials have investigated this thoroughly—the right hon. Gentleman’s target should be Leicester city council, not Sainsbury’s. My Department stands ready to help mitigate the situation. We should stay in touch on it, and I congratulate him on securing the debate.

Question put and agreed to.

House adjourned.