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Low-carbon economies and sustainable growth will require a new and different mix of services

How can local and national economies continue to grow in the years ahead without wrecking our planet?

A good part of the known answer is in low-carbon energy sources, and renewable energy sources will need to grow substantially. Another good part of the answer is in reducing demand for energy, especially by eliminating waste heat. And thirdly, we will need to switch over from manufacturing container loads of “stuff” to give more emphasis to services.

But which services?

The current preferred mix in the service sectors favours the expensive, costly areas of the economy such as finance and legal work. But while they are great for GVA (gross value added) figures, do they really add much to the sum total of human happiness and wellbeing? Of course, some aspects are essential, such as our child protection courts, or having loan bonds for public infrastructure. But we know there is a lot of expensive froth in the mix.

There is the apocryphal story of a married couple who, on their wedding anniversary each year as presents give each other cheques for a million pounds. A little bit of nonsense which cancels itself out. But in some economic models the GVA needles would fly off the scales.

So maybe the successful and sustainable economies of the future will be based on similar examples of low-carbon, low-resource exchange, albeit more sensible. The music singer who performs live outdoors to a small, paying crowd. The food grown locally and sold at a Saturday market. The evening class learning to speak Italian. Currently these forms of service work are seen as somewhat low in GVA, not quite the dizzying heights of international finance.

But maybe future local economies will be valued for having the best range of low-impact services. That in a sustainable city you can learn forty languages; and where you can choose between seven types of fresh celery; and as you stroll across town you can find every genre of music.

In summary, measuring the sustainable qualities of the value added as well as the quantity.

And to close, for the future I wonder if we will start to think that – by educating a good number or even most people in the arts – this shift will cause a lower carbon impact than by having as many people as now studying the sciences? Yes, medics and other scientists will always be essential, and I speak as a taught scientist myself, but the balance and privileges may alter in the years ahead.

Carbon Literacy and the Built Environment – Closing the Performance Gap

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The built environment is responsible for around 47% of all UK carbon emissions, and the construction industry is well placed to influence and improve this figure.

However, there is a growing body of evidence that many, possibly even most of our new and refurbished buildings in the UK are not performing anything like as well as they should, especially low energy buildings. The correct regulations are followed, the energy calculations are double checked, and the certificates are in place. But over time we sadly discover that the building often remains too cold or too hot, too draughty, too dark, or too damp. What can we do to change this?

Railpolitik, by Paul Salveson (book review)

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If I was the next Minister of Transport, Paul Salveson would be one of the first people I would have in to Whitehall for a tea and a chat. And I guess he might respond by inviting me instead to have that same tea in the cafe on Bolton station, followed probably by a trip on a creaking Pacer train to Blackburn along the single-track speed-restricted route. And he’d probably ask me to bring a carriage of transport civil servants up from London to boot.

The sub-title of this book is ‘bringing railways back to the community’, and from Community Rail Partnerships through to devolved regional development, this book sets out a well thought through path for future improvements. It is not a naive ‘bring back British Rail’ manifesto, he knows too much from the inside to think they were the golden days. Rather, the vision is of a balance of many existing and new local partnership branches attached to a national, inter-city trunk.

The book itself is a tour-de-force. It starts with a political history of rail in Britain, much needed because so many romantic but deluded myths still fill the air, and the airwaves. The Victorians made a right hash of it, basically. Then British Rail carried on, dysfunctional at its core with engineering unable to speak a civil word to operations and vice versa. All run from London on some grand plan. Then privatisation, another hash up.

And now, regrettably so often any political debate on the railways in Britain becomes boiled down to just one item— HS2.

Paul rightly points out that HS2 is designed to feed into the city centres such as Birmingham, Leeds and Manchester, and he worries that the benefits will not flow fully into the surrounding valleys, suburbs and regions. For me, this is a reminder that if HS2 is delivered without a properly functioning total rail network then it would be papering over the cracks. To be fair, HS2 supporters are becoming clearer in speaking about the wider network benefits of increased capacity. But I agree that the integration with regional and local branches still needs a more thoughtful approach, and more practical working out.

For example, if a high-speed train could not run on through Manchester to Blackburn, what else is possible? And don’t just say ‘combined tickets’. That is nowhere near good enough. We seem to have lost the ability to think about networks, and all we have left is marketing.

More people would be won over to the HS2 cause if there was a firmer commitment to securing it within a functional rail system which served the passenger first. Bread and butter as well as jam. And it is this bread and butter that Paul Salveson knows well and he articulates a thoughtful path for its rescue and development. In any other industry you would say, this is a roadmap out of the mess we are in.

Railpolitik, Paul Salveson (2013) 249pp Lawrence & Wishart, London
ISBN 9781907103810

Full disclosure: I worked with Paul in the 1980s at Greater Manchester Council for Voluntary Service and assisted slightly on the production side of his rail book then.
British Rail: the radical alternative to privatisation, Paul Salveson (1989) 158pp
CLES, Manchester
ISBN 1870053184

Published today – the RENEW Northwest Collected Works 2005 to 2008 (free PDF, 400 pages)

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PRESS RELEASE
Embargoed to 00:01, Thursday 29 May 2014

RENEW Northwest was the region’s centre of excellence for regeneration from 2005 to 2008. It worked with thousands of professionals in design, construction, housing, economic development, neighbourhoods and more and encouraged better regeneration through multi-disciplinery working in the interests of communities, the environment, the economy and society throughout the region – urban and rural, deprived and more affluent. Much of the RENEW Northwest learning is contained within over 400 pages of great advice and help to professionals involved in all aspects of regeneration and renewal. Free to download here (PDF), much of the advice is as relevant now as it was when it was produced.

From Liverpool to Manchester, from Crewe to Carlisle, great work was found, supported and celebrated. The former staff have scoured their computers and attics to put all that excellent material in one place for the benefit of everyone involved in regeneration.

Phil Barton, former Director of RENEW Northwest said, “In this age of public sector austerity, it is more important than ever that professionals, agencies and local groups work effectively together across sectors, professions and geography. RENEW Northwest pioneered new approaches and the achievement of better results by encouraging learning, good practice and professional development. RENEW’s legacy lives on and this archive is a significant resource for the region which we are delighted to make more widely available.”

Tony Baldwinson, former Head of Knowledge, Design and Innovation at RENEW Northwest said, “There is so much to choose from in this treasure trove. The Ladders in Regeneration group was especially important in making sure no-one was excluded, not just from the outcomes but also from the jobs within regeneration. Everyone will find something of use to their work here.”

Notes to editors:

1. The RENEW Northwest project was funded by the Northwest Regional Development Agency from 2005 to 2008. Its Board included the Government Office North West and the Royal Institute of British Architects (RIBA), as well as the private sector, community groups and universities.

2. The book is free to download as a PDF, using the Open Government Licence administered by UK National Archives.

3. The full website address is https://tonybaldwinson.com/wp-content/uploads/2014/05/renew-northwest-collected-works-2005-to-2008-9780957260610-v4.pdf

(ends)

Our housing crisis – is it under-supply or under-occupation?

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Is the crisis in UK housing a problem of under-supply of new homes, or of under-occupation of our existing stock? Do we need to be building 240,000 more new homes a year?

Simon Jenkins in The Guardian, 21 May 2014, (link below) makes a strong case for under-occupation being the market failure, and as such he challenges the British economic orthodoxy in construction over the last ten years, since the Barker Review in 2004.

His point especially about the abandonment of the brownfield-first planning policy is correct and well made. However, he is wrong to support the principle of the bedroom tax. This tax is regressive – poorest people pay the most, and often in circumstances where they have no options for a smaller house or flat.

He could have added that an emphasis on refurbishment over new-build would impact on construction employment because refurb is more labour intensive. And can have a strong impact on fuel poverty and carbon emissions.

But perhaps the key market failure he misses is the mismatch between urban living and urban employment across Britain, rather than just the South East.

In short, market failure needs a programme along the lines of:
1 – more jobs outside the South East
2 – reinstate brownfield-first planning policy
3 – refurbish social housing, including houses-to-flats conversions
4 – tackle poor quality private rented properties, and
5 – begin to address the issues of poorer, older owner-occupiers.

http://www.theguardian.com/commentisfree/2014/may/21/no-housing-crisis-just-very-british-sickness

Public Procurement and Local Benefits, part 3

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The previous two posts here have outlined the permitted ways by which public bodies can include local equality outcomes within contracts.

In a nutshell, the practicalities revolve around the importance of the “core purpose” of each procurement exercise. The general principle is the difference between (a) ‘just’ procuring a new school and (b) procuring better education, skills and economic wellbeing in community X in which a new school will be built.

The recent report by the Joseph Rowntree Foundation is here – http://www.jrf.org.uk/media-centre/community-benefit-clauses-public-funding-and-procurement-contracts-%E2%80%98can-be-legal%E2%80%99

Also useful here, the Equality and Human Rights Commission produced a guide in 2013 to public procurement and equality benefits, called Buying Better Outcomes. A key extract is:

“Equality clauses may be introduced under these arrangements relating to the performance of the contract, but they must:

be compatible with EU rules (as determined by the Public Contract Regulations 2006 and any other related legislative requirements)
be relevant and related to the performance of the contract
not be a technical specification in disguise or used in the evaluation process
not discriminate (directly or indirectly) against any potential tenderer
be able to demonstrate that value for money is maintained, and that whole life costs are taken into account
be proportionate and quantifiable
be referred to in the contract notice or tender documentation, and
be clear and unambiguous, and understood by tenderers and contractors.”

Link: http://www.equalityhumanrights.com/uploaded_files/EqualityAct/PSED/buying_better_outcomes_final.pdf

As pointed out in the first article, it would be helpful now for Treasury Solicitors to produce guidance for public officials on the operational steps to achieve local and equality benefits using public procurement.

Tackling Poverty Through Public Procurement – details for practitioners

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My previous post commented on the launch by the Joseph Rowntree Foundation (JRF) of their report on Tackling Poverty Through Public Procurement. That post looked at the policy implications of the report, and this post follows on with a discussion about the practicalities. The audience here is assumed to know the usual workings of public procurement in the UK. For those who don’t and are interested to know more, a useful free starting point is https://www.gov.uk/tendering-for-public-sector-contracts/the-procurement-process .

The key lesson from this JRF report is that it is possible to operate a public procurement call for bids where the successful contractor will have to work with a named list of local agencies in order to provide additional local impacts, including employment and training for people in the most disadvantaged areas and groups. To be lawful, this requirement must be advertised right at the start, such as in the Official Journal of the European Union (OJEU). This must be quantified, for example following the JRF target of 52 person-weeks of employment for the most disadvantaged residents for each £1 million of contract value.

This approach is compliant with the MEAT (most economically advantageous tender) criteria for scoring bids which by law can include environmental and social criteria as well as economic ones. All criteria used must be relevant to the nature of the contract and to the wider work of the purchasing client. One of the most powerful reasons for local employment and training is that any improvements in disadvantaged areas and groups will improve the value for money obtained by the wider public sector in lower costs to a range of departments and services, for example in lower requirements for out-of-work benefits.

It was noted at the launch event that these additional criteria are actually most frequently applied in the procurement of major construction projects, which is all well and good, but they now need to be taken further into contracts for services and supplies. These non-construction procurements actually are a much bigger slice of the cake.

Some of the typical concerns raised by some procurement practitioners are as follows:

1. Will it cost more?
No, the firms which are good at recruiting disadvantaged people are also good at their work generally, including cost control. The local benefit criteria is typically around 5% of the total score, so winning companies will also be very good at the other 95%.

2. Will it be a make-work scheme?
No, because successful firms want all of their staff to be as productive as possible so they will develop any previously-disadvantaged staff along with the rest of the workforce.

3. Will EU rules allow it?
Yes, and the details are in the JRF report. This applies both to the law about free mobility of labour and the law about firms in all EU countries being able to bid equally. It is equal because the local agencies will work with whoever wins the bid, wherever their head office is. And the local agencies will not discriminate against disadvantaged residents based on their nationality, directly or indirectly.

An interesting example of this work in practice was described at the launch event. Birmingham City Council has co-located a local employment officer within Network Rail in connection with the redevelopment of New Street rail station. As one result, 10 unemployed apprentices were recruited by a local demolition sub-contractor.

The presentation by Birmingham City Council outlined the following factors to ensure success:

– Make it policy.
– Get buy-in from partners, including the private sector.
– Embed the details within contracts
– Support businesses and train public sector procurement staff
– Agree the key performance indicators, otherwise it will drift into easy-to-do areas and groups
– Monitor the data, and use RAG ratings (red, amber, green) to trigger payments
– Celebrate successes
– Make it business as usual.

As one speaker said, you have to “bake in” the targets into the contracts, but don’t jump all over contractors or sub-contractors if they get a red RAG rating, but instead support them to find solutions. And, they added, it is better to give the opportunity to 10 people to change their lives than to list 100 people moving from one work programme to another.

A phrase that was used repeatedly at the launch event was that public procurement staff needed to know that they had permission to impact in the most disadvantaged areas and groups. Finally, within the presentations it was noted that in Birmingham the director of public health is now looking to copy the council’s approach into their own contracts, such as mental health support services.

Tackling Poverty Through Public Procurement

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Today (28 April) saw the government’s launch requiring long-term unemployed people to sign on every day. Two bridges along the river from Parliament, today also saw the launch by the Joseph Rowntree Foundation (JRF) of their report on Tackling Poverty Through Public Procurement. In my view the JRF report may ultimately have a bigger impact on reducing poverty and changing lives. I would say that JRF is upstream of parliament certainly geographically but also in terms of policy.

In a nutshell, Richard Macfarlane explained how the report shows that is perfectly lawful for public bodies to specify a list of local agencies that must be worked with, whichever company wins the contract and wherever they come from in the EU or beyond. Equally the local agencies must re-affirm that will work with anyone who meets the criteria for being disadvantaged within their catchment area, regardless of their EU (or even non-EU) nationality.

A case study from Birmingham then looked at how the council has managed to include local employment clauses into major procurements with a programme of £7.9 billion and a pipeline of £0.9 billion of further work. The deal is that 60 person-weeks of employment or training is procured for every million pounds within any major contract. The council has tracked the impact of their work on the most disadvantaged localities and have seen significant reductions. Impressively, 17 homeless people in Birmingham are now in full-time employment because of better procurement. Lives have been changed.

The JRF launch was chaired by Chris White MP, the author of the Social Value Act 2012 and the vice-chair of the all-party group on poverty. The speakers were the authors of the report (Richard Macfarlane and Mark Cook), from Birmingham City Council (Shilpi Akbar, Assistant Director for Employment) and Carillion (Simon Dingle, Operations Director) with a case study in using procurement for stronger local impact. The JRF lead is with John Low, and the lead started out twelve years ago with Peter Marcus, now at Zenith Chambers. The first report in 2002 was called, Achieving Community Benefits Through Contracting.

So you might well ask, if it is plainly lawful and such an obviously good idea, what is the problem? Well, guess what — the governments of Wales and Scotland, and many English local authorities are on board, but bits of Whitehall remain stuck in the mud. Various suggestions were made at the launch event as to what to do with Whitehall. Perhaps some departments and agencies genuinely struggle to understand the ‘place impact’ of their procurement? They need help. Perhaps ministers are fearful of any new guidance or permission to civil servants looking like a new regulation, given the ‘one in, two out’ mandate to reduce regulation? They need reassurance.

This could well be a topic where local authorities involved in City Deal discussions with Whitehall take a lead, ideally in true partnership, but with muscular and co-ordinated persuasion if necessary. There may also be a role for the Core Cities and the Eurocities networks here.

JRF announced their plan to convene a network of interested organisations to take this agenda forward, to meet with politicians and with civil servants where possible, and to hold regional events. For my money, getting the Treasury Solicitors on board with explanatory guidance to colleagues would be a great impetus.

ERDF and Local Strategies

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The general feedback being given to LEPs on their draft Local Strategies is that many of these have been too similar and generic, too much ‘of a type’. To some extent this is understandable. ERDF itself is quite prescriptive in terms of what is eligible for funding, so a local strategy that, say, focused on improving bus routes would not get very far at all.

Also, the strong focus for ERDF in 2014-2020 on SMEs, low carbon, and innovation sets down some new constraints. In my view this is good, in that it challenges areas of high unemployment not just to keep running the ‘same old’ projects, sometimes even for the ‘same old’ beneficiaries.

So, it seems too many of the local strategies have started out with some local statistics but then go on to suggest generic, boilerplate solutions.

CLES have usefully analysed and commented on a range of LEP strategies, and especially on the worrying degree to which there is a lack of social inclusion so far in quite a few of the strategies. As they comment, some strategies are purely economic and take the approach that ‘a rising tide will lift all boats’. Well, we know too well that some boats all too often get left behind, stuck and forgotten.

The Leader of Manchester City Council, in his last blog before the purdah of local elections, makes the point that the persistently high levels of unemployment in disadvantaged communities still needs more effort and solutions, especially for those people who are furthest from the labour market.

And in my view this points to a weakness in a lot of local strategies. It is very easy to focus on employment sites, rather than on communities. So, for example, a new supermarket is about to open, so there is joint working to ensure that as many jobs as possible go to local residents. Which is well and good, and we all pretty much know how to do this by now. We also know in our bones that, too often, many of the new quality jobs will miss local residents completely and get taken by commuters from, bluntly, the posher areas. Is there another way?

What is so much harder to do is to start with community X. Very few strategies actually know the details of the jobs that people already have in community X. Nearly all employment analysis we do is based either on very large travel-to-work or conurbation areas or is based on the workplace itself. The best source of community-based employment data is probably held by HMRC, which at the moment is mostly forbidden by law from sharing their data – even with other departments within government. HMRC consulted last year on how they might better share data, of course with strong ethical and privacy safeguards. That consultation gave a flavour of HMRC’s deep frustration with an example where they could not share data with the health authorities in Wales even though that could have reduced the number of winter deaths of elderly people.

HMRC data will be able to say, for any postcode, ward, output area, etc, — how many people who live here are working, where, doing what, for how long, and for how much. And it will only be by digging into this type of very local community-specific data that we can start to design and support those projects, interventions, which will make a difference.

However, we cannot wait for a change in the legal powers of HMRC, so we need to devise other cost-effective ways to collect rich knowledge on employment at the community level.

I think we are in for a few surprises. I hope so. I would love to find out that, for example, in Beswick or wherever there is a strong skills set in model making and repairing. Maybe this is clustered around a club of retired steelworks engineers who, along with an interested technology teacher, have passed on the skills and contacts to a new generation, who are now using the internet and post office to supply enthusiasts overseas.

And what they don’t need most from ERDF is a job trial at the local supermarket.

Was there more funding for the voluntary sector during the 1980s than today?

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NCVO, the National Council for Voluntary Organisations, has published figures which show that the voluntary sector has lost £1.3 billion in funding from the government in the last year (link below). The gap was filled by a rise in private donations from individual people.

NCVO’s figures of income for the third sector started being collected in 2000/01, and this year just finished is the first since then where the income from government grants and contracts has fallen.

I wonder how these figures would compare with the 1980s? In 1988 the Commission for Racial Equality commissioned GMCVS to produce a paperback guide on funding for BME groups. It was my pleasure to write that book. Below is a link to a PDF copy.

OK, it was qualitative not quantitative – the book listed all the sources, not the amounts available. But it listed a wide range of central and local government sources of funding, including government agencies such as the Equal Opportunities Commission, the Manpower Services Commission, the various urban Task Forces, the strands of the Urban Programme, and many more.

So I personally would not be surprised to be told that, in real terms, there was more funding for the voluntary sector from all government sources in 1988 when compared with 2014. Have a look for yourself.

BOOK: FUNDING – a handbook for ethnic minority groups in North West England – 1988 – ISBN 0-9513921-0-7

News item: NCVO: http://www.thirdsector.co.uk/go/news/article/1288858/latest-uk-civil-society-almanac-shows-voluntary-sector-shrinking/