In brief
Urban regeneration – an answer to poverty

‘I believe in greater equality. If the next Labour Government has not raised the living standards of the poorest by the end of its time in office it will have failed.’ Tony Blair, July 1996

Speaking while still in opposition Mr Blair could hardly have foreseen the Labour landslides of 1997 and 2001 and the two-term timescale these would allow for the achievement of what was declared to be a key ambition for his Government. How goes New Labour’s fight against inequality? Not too well according to some.[footnote 1]

Area-based Initiatives (ABIs) are one of the key strategies aimed at reducing poverty, inequality and ‘social exclusion’. Currently these initiatives include the Single Regeneration Budget (SRB) and New Deal for Communities (NDC) programmes. Both seek to go beyond the physical renewal of housing and the built environment and to bring about improvements in jobs, education, law and order, community development and so on. In other words, the aims are holistic and much stress is being laid both on better inter-agency working and on ‘community led’ regeneration.

The Stepney Health Gain project
The Central Stepney SRB in Tower Hamlets has replaced some very poor council housing with new RSL (housing association) homes. The ‘Health Gain’ evaluation carried out between 1996 and 2000 showed a dramatic reduction in the incidence of self-reported ‘illness days’ following the regeneration programme. The key findings were:[footnote 2]

• Housing quality and space standards were much improved in the new homes.
• The incidence of illness days fell to one seventh following the improvements.
• Residents reported improvements in relation to crime and the fear of crime, children’s progress at school, quality of service provision and other issues.
• There was a strengthened loyalty to the area and a more positive view of community life on the estates.

Against these positives there were two negatives:

• There was no detectable evidence of positive ‘spread effects’ outside the SRB area (only about 10 per cent of Tower Hamlets) either in official health data or front-line workers’ caseload experience.
• Some re-housed households reported that they found it difficult to cope with higher costs in the shape of rents, water charges and council tax.

The latter effect, if backed up by evidence, would throw doubt on the ABI regeneration strategy as a means of reducing poverty and inequality.

Better health – higher costs
The Stepney Household Costs project was therefore carried out in 2000/01. It included both a large-scale (131 households) and a small-scale (20 households) survey – the latter carried out by staff from the Limehouse Project, an advisory agency briefed both to record full details of changes in household finances following re-housing and to deliver financial and welfare rights advice where required. The results from the 20 intensively interviewed households confirmed the anecdotal reports:[footnote 3]

• Allowing inflation and increased space, rents have risen by an average of 14.8 per cent.
• Most households have moved up the council tax banding and six of the twenty Stage 2 households are now above the council tax benefit cap (Band E).
• Water charges (now metered) have risen by an average of £1.62 per week.
• In total the cost increases average nearly 27 per cent (or £22.87 per week) and 75 per cent of this is due to higher rents.
• Six of the twenty Stage 2 households are having to economise on food and other spending; this could well lead to negative health outcomes.
• These increased costs have also increased dependency on a number of benefits and complicated the task of moving off benefits into employment.

Regeneration policy – some way short of holistic?
What did Mr Blair mean by ‘living standards’? The Central Stepney SRB, managed by SHADA (the Stepney Housing and Development Agency) has had great success in renewing a very run down environment and improving other aspects of the area to the great satisfaction of residents. But rising housing costs, council tax and water charges have added to the financial burdens of some of the poorest households in the country and have had repercussions on their living standards in other ways.

We do not know the extent to which the Stepney findings hold true elsewhere but it seems clear that the aim of reducing poverty and inequality is not furthered if long-needed housing improvements carry a price tag for residents in the form of a 27 per cent increase in living costs. On the basis of this evidence some closer harmonisation of renewal, housing, taxation and benefits policies seems called for.

Peter Ambrose, Visiting Professor in Housing Studies, Health and Social Policy Research Centre, University of Brighton

Footnotes
1. See for example, P Ambrose, A Drop in the Ocean: the health gain from the Central Stepney SRB in the context of national health inequalities, Health and Social Policy Research Centre, University of Brighton, 2000 and D F K Chantrey Vellacott,, Inequality in the UK, Economics Briefing Note, 2001 [back to text]
2. P Ambrose, A Drop in the Ocean: the health gain from the Central Stepney SRB in the context of national health inequalities, Health and Social Policy Research Centre, University of Brighton, 2000 [back to text]
3. P Ambrose and D MacDonald, For Richer, For Poorer? Counting the costs of regeneration in Stepney, Health and Social Policy Reserach Centre, Univertisty of Brighton, 2001 [back to text]

Poverty 110, Autumn 2001