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http://www.bbc.co.uk/print/radio4/facethefacts/transcript_20070817.shtml

FACE THE FACTS

New Deal for Communities

Presenter: John Waite

TRANSMISSION: Friday 17th August 2007 1230-1300 BBC RADIO 4
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Waite

This week, we investigate the government's New Deal for Communities - a bold, multi-billion pound project to kick start deprived areas all over Britain. We'll be focussing on two. Both are in the East of England; both involve run down estates. Both projects will run for 10 years and receive around the same amount of funding - just under £50 million pounds each. And both have already spent about £30 million. But there any similarity ends. Because the millions in public money that have gone into North Earlham in Norwich seem to have been spent very wisely. Whereas the funds that have been swallowed up at Marsh Farm in Luton don't seem such a good deal for the taxpayer. Nor for the increasingly disenchanted residents of Marsh Farm itself.

Blackett

This is the Marsh Farm that a lot of people used to say they're not going to come in because it's such a dangerous place and most of the projects that have been operating in that New Deal or the money that has been given has been absolutely wasted.

Vox Pop

Nothing has changed in 10 years that I've lived here and all my friends here - around here they've lived here all their life and you ask some of them - nothing has changed.

Cowell

People have been let down dramatically by persons who are supposedly the pillars of society, they're supposed to give not take.

Waite

The concept of New Deal Communities was a new idea from the then new government of Tony Blair. A sustainable, publicly-funded regeneration programme that would give hope to some 39, mostly inner city, areas.

Blair

We've now got to demonstrate, not just as a government but as a nation, the commitment to improve the quality of life in these worst estates, to say for the first time really in decades this is not a hopeless problem that cannot be solved.

Waite

And to help solve it, in 1998, the New Deal scheme was born. Professor Paul Lawless is Director of the NDC's evaluation team based at Sheffield Hallam University.

Lawless

The New Deal for Community Programme was very much about transforming these areas over 10 years, it is a 10 year programme, and in so doing improving the lives of people in five broad areas - education, health, crime, jobs and housing. And one other key feature I think that is worth mentioning at the outset is that the community was to be at the heart of the initiative, it was very much a local community driven initiative.

Waite

Although the various communities don't receive the money direct. First it goes to the regional government office -"GO-East" in the case of Norwich and Luton. This in turn is passed to "the accountable body" - usually the local council - and it's only then that staged payments are made to the community trust which will actually administer the spending. In Norwich, this is the North Earlham, Larkman and Marlpit development trust, NELM.

Ralph

The New Deal for Community area in Norwich is three post-war housing estates - the North Earlham Estate, the Larkman Estate and the Marlpit Estate - and built in the '50s and '60s, quite good quality housing stock but the majority of the houses are council run and occupied and there are lots of needs of people in the area - quite low skill levels, quite a lot of ill health, a very young community - over 50% of people who live in this community are under 25, so there's lots of teenagers, lots of young families - and quite low levels of skills and worklessness.

Waite

David Ralph is chief executive of Norwich's NELM development trust which has bought to date some £15 million worth of assets to provide a lasting legacy for local residents. Including a smart, new, local business centre which, as we climbed its stairs, David told me had proved very successful.

Ralph

We're here at the Henderson Business Centre, most of the businesses are small local Norwich businesses and have been either working from home or working in different places and we bring them together, so it's a good business to business relationship, so there's a lot of people who work in supporting enterprise development, business development, regeneration of Norwich - there's a lot of regeneration going on in Norwich generally - and they're here, it's been open about a year and they're finding it's a very useful site for them to come together.

Waite

As I discovered for myself when I popped in to one of the small businesses, the Workshop. Where director Jenny Eaton was very happy with how New Deal money has been spent.

Eaton

Well I think it's pretty fantastic, I think it's made quite a difference to the area and certainly it's been a great facility for us. We set up the business at the beginning of this year and our business offers training and research and marketing. When we initially looked to set up the business we looked at ways in which we could have run it and the consideration obviously is money when you start, there's no way that we could have set up the sort of business that we want to run from home. And so it's been fantastic for us. We hope that we're here for a long time.

Waite

In fact being in place for "a long time" is a key element in the vision of New Deal Communities. Their funding is supposed to deliver sustainable, long term projects. Which is why - according to David Ralph - acquiring income-generating assets like the business centre is so important.

Ralph

Some strategic decisions were made early on in this programme which is when we were doing capital investment - so the building and construction of new buildings. They would be owned by the community and where possible we would generate income from them in the long term and that's a real challenge. So we've tried to find assets that could make us some money and we own about six printable assets, that should bring in for us about £3-400,000 a year worth of income and that can help generate other projects.

Waite

David Marlow agrees. Sustainable assets are vital. And he should know, as he's Chief Executive of the East Of England Development Agency which is tasked by the government with driving economic growth in the region.

Marlow

This can be a key element of delivering that long term future because if you have an asset, say a building that you can rent or a set of facilities that generate an income stream, that in itself can fund long term activity that makes sure that the regeneration is really embedded in the community itself.

Waite

So it lives on beyond the scheme?

Marlow

That is always the objective.

Waite

An objective which - at least in Norwich - is well on the way to being met. Everyone I spoke to there said the £30 million of NDC funding so far released had been very well spent. Contrast that to Luton, just a hundred miles away, and its Marsh Farm estate, and the story's a very different one. No smart new business centre there - just a tired old shopping centre.

Well I'm walking through a pedestrian underpass that leads out into the Purley Shopping Centre and here we are - a square outside. And it's lunchtime on a July midweek day, I can count six people, seven people, you can probably hear how empty it is and this is supposed to be the main shopping centre. It's a pretty grey day, as many have been this summer, but this place looks particularly bleak today. It all looks and feels very depressing. And I have to conclude that from the lack of people here they're depressed at the prospect of coming here to do their shopping.

The Purley Shopping Centre lies at the heart of the Marsh Farm Estate, and, since 2001, has been central to the estate's regeneration plans. But, six years on, none of those plans has come to anything. And this is despite the Marsh Farm Development Trust having already spent £27 million of its funding . Dejected shopkeepers told me business is not regenerating but degenerating.

Shopkeeper

Actually busy only two days very busy here - Thursday and Saturday. And the rest of the days are very quiet, very quiet.

Waite

So it's hard to make a living here?

Shopkeeper

It's quite hard yeah, it's quite hard. Everybody wants to know where's the money gone - £27 million taxpayers money, where's that gone?

Waite

Are people angry about it here?

Shopkeeper

Yeah, quite. We never ever saw any single road built in this area or school or something like that, that's the question, a big question - where did the money go?

Shopkeeper

If there is benefit I would say it is marginal and very minimal, it is not noticeable, there is nothing happening. It's sad and it's pathetic.

Waite

And, many residents told me, it's not as if the problems of Marsh Farm aren't well known. TV screens across the nation were filled with images of the place when riots broke out there in 1995.

News clip
Many of the rioters on Luton's Marsh Farm Estate were armed with petrol bombs and this car made an easy target. The Thames Valley Police helicopter had to be called in, as well as reinforcements from Buckinghamshire and Hertfordshire. The trouble flared around 8 o'clock last night ...

Waite
Marsh Farm is an area that had long been neglected with high levels of crime, unemployment and poor health. So, in 2000, when the news was announced that it would be receiving a £48 million regeneration grant over 10 years the feeling of optimism in the community was high.

Blackett
Oh it was a time of excitement, expectations and we were so delighted that everyone was talking about this money that is going to do something for our community, especially we've had a bad name you know during the riot, so we thought we're going to start from afresh and do something for the young people, for the old people, for everyone in Marsh Farm.

Waite
That's local nurse and long time resident Jackie Blackett who served as a director on the Marsh Farm Community Development Trust for five years. Fellow resident, and church minister, Vic Cowell, is a current board director.

Cowell
There's a tremendous amount of apathy not because people aren't interested but because they've been promised so much in the past and received so little. And they needed a bit of - a bit of hope. I think that's the best way to put it - hope - to build it up, build them up and to give them something that was tangible, that they could see what it was, that's something to go for, it was theirs.

Waite
To help realise all those hopes, Vic Cowell signed up to be one of Marsh Farm Trust's board of directors. A bit, he says, like a school's board of governors. Whilst they don't get involved in the day to day administration, they do approve senior appointments and major spending. Or, at least they should.

Cowell
According to the governance, which is, if you like, the book of rules, it is there to oversee the operations of the trust, it is a company board, same as any other board, it's a company limited by guarantee with a chairman, board of directors etc. It is supposedly to oversee, to finally approve projects before they actually go out to Government East for their approval and funding, that's basically what it is.

Waite
And what sort of people are on this board, how's it comprise?

Cowell
Most of them - the majority are residents of the Marsh Farm Estate. We also have representatives of local authority, we have two local councillors and what we call partners who are there to provide their expertise and knowledge to enable us to come to a sensible decision. It's not working that way.

Waite
And one crucial way it isn't working, according to Vic, involves directors receiving proper financial statements on matters of major expenditure. In particular, on expensive consultants whose work some board members like Vic had begun to suspect had been swallowing up sizeable percentages of the £27 million the trust had so far spent.

Cowell
Whenever you mentioned finance you hit a brick wall. Ah yes we'll get them to you, they never arrived. Even the one time I had a board meeting I put forward the fact I'd asked for certain information and the chief executive admitted in front of the board that he had received my e-mail requesting details of payment to consultants - how much and over what length of time - I never got that information and still have not.

Waite
And it's not just you who's been ...

Cowell
It's not just me, it's other people - one of my colleagues has been constantly on it, almost on a weekly basis.

Waite
So, again, contrast the "brick wall" approach in Luton to the complete transparency in Norwich.

Ralph
Every quarter I am required by my board to show where I have spent money on consultants, I mean that is how rigorous we are, so that we can see. And if I bring someone in to do a bit of training, for example, which you know I want to train my staff, I want to train my board, then they want to know how much did that cost but actually getting good quality things paid - sorry costs - it costs money to get good quality support and that's worth paying for if you get a decent project at the end of the day.

Waite
And that's what the outside experts, the consultants in Norwich, seemed to have done. Helped establish a successful project by developing a sustainable asset base worth £15 million. But at what cost? How much has Norwich spent on outside experts?

Ralph
We've spent on the site, we've spent about £15 million and we've spent just over a million pounds on the use of consultants. In addition to that we have to be audited every year, that costs about £10,000 a year and there's not much else apart from that.

Waite
So the overall percentage is...?

Ralph
About 3% of the overall budget will be spent on consultants.

Waite
So, chief executive David Ralph has no problems it seems telling anyone how much money has been spent on consultants.

Back in Luton, however, that's something board director Vic Cowell couldn't discover - even from his trust's so called "accountable body" - Luton Borough Council.

Cowell
It got to the state whereby when we approached the local authority for information it was refused.

Waite
Information about the consultants?

Cowell
About the consultants, about the trust - the whole thing about it - we were refused.

Waite
Well, perhaps we may have a reason why, in Luton, board directors have been kept in the dark. Because Face the Facts has learned that more than one pound in every ten spent so far, has gone not on projects but into the pockets of consultants. Over £3 million in total. One of the longest serving consultants, Kamljit Chana, has been working at the trust in a variety of roles for the past three years, for the past 10 months she has been Interim Programme Director. Her services are supplied to the trust by a company called Tribal Consulting and when we asked the council and the trust to tell us how much Tribal were charging for her services they refused. But we found out anyway. In June she worked 23 days at £560.00 per day. And it's this kind of spending that has led to a feeling of resentment towards the trust.

Blackett
This is wrong.

Waite
Former trust director and Marsh Farm resident, Jackie Blackett.

Blackett
Give jobs to local people and I'll tell you this - we have local people here who would show up those people with knowledge, that can run that place and they haven't got a look in. This is a great disadvantage to these people in Marsh Farm. We have been disenfranchised.

Waite
A feeling of outrage I found common across Marsh Farm - including in the local pub, The Purley tavern, and the very first couple I met.

Do you have any confidence in the trust to work on your behalf to bring to this community what you would like to see?

Resident
Not at all.

Waite
Isn't that what they're supposed to do?

Resident
Not at all. I mean the money is supposed to be there, we get a newsletter in once a month and they're saying oh they're going to do this, they're going to do that but you can read it but what has been done? Nothing.

Waite
Do you have any confidence in the trust?

Resident
No I don't, no I don't, not at all because like my partner's just told you, you get these newsletters and they all - they keep changing, they say we're going to do this for Marsh Farm, we're going to do that for you for Marsh Farm and it doesn't change. I mean I've lived here nearly 10 years now and nothing has changed in 10 years that I've lived here and all my friends around here they've lived here all their life and you ask some of them - nothing has changed. All this money - where has it gone? Can somebody answer that?

Waite
Well, let's try. Apart from the £3 million or so we've established has been spent on consultants our investigation has also uncovered a veritable litany of projects, some run by those highly paid consultants, that have either failed to live up to expectations or failed to provide any form of sustainable life beyond their New Deal funding.

Reading - Projects
Credit Union £280,000. The branch set up with New Deal money has closed down.
Back to Health £183,000. Holistic back massages didn't catch on so it's back to the drawing board.
Maple Lodge £321,000. A drugs programme where money wasn't ring faced for people in Marsh Farm.
Community IT technicians £274,000. A project which failed to sustain.
Empowering Black Voluntary Group £35,000. Failed to live up to expectations.

Well I've come now to look at where some of the money from the trust was spent. A series of artworks in fact were commissioned and built around Marsh Farm. This is the one standing just outside Marsh Farm's children's centre, £30-40,000 was spent on this particular artwork, it is apparently two metal bicycles, I say apparently because I cannot see it - and you'll see why in a moment - it is in fact now encased - entombed - in a great cube of wood because when this £30-40,000 worth of artwork was erected soon afterwards it was thought to be a health hazard. And so it's been removed from sight, put out of harm's way as it were, and of course therefore is of absolutely no use whatsoever to anybody, least of all the residents of Marsh Farm.

In all, Face The Facts has identified over £2 million spent on projects that have failed to live up to expectation or which are, quite simply, not sustainable. And, remember, sustainability is crucial to New Deal community funding - according to the Chief Executive of the East of England Development Agency.

Marlow
If you've been successful the community will continue to work together, it'll continue to be engaged in employment and enterprise that itself generates more wealth and activity in the community and it becomes a virtuous circle of development and growth and improvement.

Waite
Well the "virtuous circle" in Luton would appear to have gone a bit pear shaped. Because, in fact, we could not identify one single project in Marsh Farm that will sustain beyond the 10 year lifespan of its New Deal money. However, we did discover that over £4 million of the trust's funding has been spent on projects that might more properly have been funded by the local council. Like the £1½ million pound contract the trust is paying out for new street lighting. When, of course, maintaining and replacing street lighting is a statutory requirement normally funded out of ordinary council revenue. And then there's the possible redevelopment of the Purley Centre, that council owned complex of shops and flats in the heart of the Marsh Farm Estate. If tenants have to be moved out - that will cost a lot of money in compensation. But a council report we have obtained shows that Luton Borough Council was hoping it could shove that bill, too, in the Marsh Farm trust's direction.

Reading: Luton Borough Council Report
Item 16: Financial implications. Costs of compensation might be as large as £950,000. Although officers are in consultation with the Marsh Farm Community Development Trust to try to ensure these costs do not fall to the council.

Well a number of directors we've spoken to say they fear that the local council regards the Marsh Farm trust as a "cash cow". So what is the explanation for using £1½ million pound of trust funds to install street lighting on a council estate? No one from either the trust, the council or the government was prepared to appear on the programme today. So in a statement we were told:

Statement
Through council funding, it will be many years before all the lighting in Marsh Farm will be replaced. The New Deal Communities funded street lighting project will allow many residents to benefit from improved lighting over a much shorter timescale.

Waite
And what about that move by the council to saddle the community trust with a near-million pound bill to compensate council tenants?

Statement
No decision has yet been made and if New Deal funding were to be used it would be subject to appraisal.

In fact Luton Borough Council and the community trust were now working together, we were told.

Statement
Like most NDCs, we experienced some initial problems. However, lessons have been learned as indicated in its annual performance review where the government office has rated its overall performance as "good". The trust continues to deliver a number of successful projects which has contributed to raising the educational achievements of local children, helping people to live a healthier lifestyle, and supporting local enterprises.

A view endorsed by the local government office. After a "slow start", it says:

Statement
GO-East is satisfied that full and proper accountability and governance arrangements for the trust have been put in place.

But is that entirely true? Tribal Consulting have been receiving well over £500 per day for providing a consultant to one post at the trust since September last year. A lucrative arrangement for the company, that directors claim, should have been put out to tender according to the trust's own governance. But it wasn't. And interestingly the trust claim it didn't need to be. So what about that most fundamental tenet of New Deal funding - investing in sustainable projects? Norwich, remember, has developed an asset base worth £15 million, generating an income of over £400,000 a year. Luton, on the other hand, out of a total spend so far of £27 million over six years - not a penny has gone on a single sustainable project. Though, we were told, the trust:

Reading
Is currently looking at the issue of owning assets to generate self sustaining income.

Waite
Well, better late than never, according to church minister and trust board director Vic Cowell. Who kicked up such a fuss, you'll recall, over being kept in the dark over the trust's spending of what is after all public money. The trust told us that full financial information has now been disseminated at a board meeting. But Vic, a Marsh Farm resident himself, still believes that after six years and nearly £30 million, his New Deal Community has so far got a raw deal.

Cowell
This money was given for the benefit of Marsh Farm, to enhance and improve their way of life, it wasn't there to put up fancy lampposts, it wasn't there for stupid so-called sculptures that you can't even use or see. So what's the idea? Why won't you let us have what you said we could have?

Blackett
The money that has been given has been absolutely wasted. There's nothing physically constructive to say that something has been done. The council stood by,GO-East stood by and they made this thing here - the New Deal - it wasn't run properly and they did nothing.