Introduction to European Commission Funding: ERDF and JESSICA

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1 Developing interest - appendix: March 2013 Appendix 1: Introduction to European Commission Funding: ERDF and JESSICA European Regional Development Funding (ERDF) aim[s] to strengthen economic and social cohesion in the European Union by correcting imbalances between its regions. ERDF finances: Direct aid to firms to support sustainable jobs Infrastructure Financial instruments to support regional and local development Technical assistance. JESSICA (Joint European Support for Sustainable Investment in City Areas) is a special support instrument within the ERDF. It is developed in cooperation with the European Investment Bank (EIB) and supports sustainable urban development and regeneration through financial engineering mechanisms. JESSICA promotes sustainable urban development by supporting projects in the following areas: Urban infrastructure including transport, water and energy Heritage or cultural sites for tourism or other sustainable uses Redevelopment of brownfield sites including site clearance and decontamination Creation of new commercial floor space for SMEs, IT and/or R&D sectors University buildings medical, biotech and other specialised facilities Energy efficiency improvements. There is potential for technical assistance support through the EIB s JASPERS (Joint Assistance to Support Projects in European Regions) programme. JASPERS targets assistance on major infrastructure projects costing more than 50 million supported by the EU funds for example, roads, rail, water, waste, energy and urban transport projects. 1

2 Developing interest: - appendix March 2013 Appendix 2: Identified pipeline by city (millions) PUA Type Overall spend Urban Core Transport spend Green spend Housing Broadband Other Unaccounted for Aldershot Buoyant Birkenhead Struggling 4,531 4,524 7 Birmingham Vulnerable 17,000 1, ,300 4, ,002 Blackpool Vulnerable Bolton Struggling Bournemouth Robust Bradford Vulnerable Brighton Buoyant Bristol Buoyant 3, , , Burnley Struggling Cambridge Buoyant 1, ,000 Coventry Vulnerable 2, , Crawley Buoyant Derby Stable Doncaster Vulnerable Hull Struggling Leeds Robust 8,317 1,580 5,250 1,480 7 Leicester Stable Liverpool Vulnerable 9,565 6, ,100 Manchester Stable 5,999 2,292 1, Middlesbrough Struggling Milton Keynes Buoyant 1, ,208 Newcastle Stable 1, Nottingham Stable 1, Oxford Buoyant Peterborough Robust Portsmouth Robust 1, Preston Stable 1, ,100 Reading Buoyant 1, Southampton Robust 3,000 3,000 Stoke Struggling Sunderland Vulnerable Swindon Stable Warrington Stable 1, ,250 York Robust

3 Developing interest - appendix: March 2013 Map of pipeline deveopments Pipeline developments ( millions) Urban Core Transport spend Newcastle Green spend Housing Sunderland Broadband Other Unaccounted for Middlesbrough Total size of investment York Leeds Preston Bradford Blackpool Bolton Hull Largest investment: 17,000 million (Birmingham) Burnley Doncaster Birkenhead Smallest investment: 159 million (Burnley) Manchester Liverpool Warrington Stoke Derby Nottingham Leicester Peterborough Cambridge Coventry Birmingham Milton Keynes Oxford Bristol Swindon Reading Aldershot Crawley Southampton Brighton Bournemouth Source: Contains Ordnance Survey data Crown copyright and database right Portsmouth

4 Identified pipeline by LEP (millions) LEP Overall Urban Core Transport spend Green spend Housing Broadband Other Unaccounted for Black Country Cheshire & Warrington 0 Coast to Capital Coventry & Warwickshire 0 D2N2 0 Dorset 0 Greater Birmingham & Solihull Greater Cambridge & Peterborough 0 Greater Manchester 0 Humber 0 Lancashire Leeds City Region 0 Leicester & Leicestershire 0 Liverpool City Region North Eastern 0 Oxfordshire 0 Solent South East Midlands Stoke-on-Trent & Staffordshire 0 Swindon & Wiltshire 0 Thames Valley Berkshire 0 West of England York & North Yorkshire 0 Totals % 19.01% 0.16% 2.54% 0.08% 24.22% 47.13% Developing interest - appendix March

5 Developing interest - appendix: March 2013 Appendix 3: Market testing To gain a better understanding of the estimated project pipeline and potential investment opportunities for UDFs in the next funding round, market testing with property development and investment experts was undertaken. Though anecdotal, their evidence provides insight into planning for and interpreting the development pipeline in UK cities. Interviewees noted that there are no set rules for determining project pipeline viability at the city level - every city has potential for viable projects. That said, they did express concern about the quality of information available about projects as well as the quality of projects themselves. For example, many of the city centre redevelopment projects are seen as trophy spending that provide good publicity but are impractical. 1 For this reason, the pipeline around city centre redevelopment should be examined with particular scrutiny to judge each project s viability. Centre for Cities previous research 2 found that developers and investors are less likely to take on a development project if: Occupier demand is uncertain Development terms, charges and returns are set at pre-recession levels A city cannot offer a reliable, efficient planning service A city is not united behind a project, making political or public opposition likely. Thus choosing projects is rarely a clear cut process. The partners in a potential deal need to have a good understanding of the priorities and motivations of each party. In doing so, developers, investors, and the public sector understand where risks can be minimised or trade-offs can be made with risk and return. Contextual factors: being a good partner Willingness of the public sector to make tradeoffs around risk and reward Cooperation of planning departments and the council Expertise of the public sector partners in developing plans Political stability of councils Project factors: having good projects Likelihood of being able to sell the project upon completion and so make an exit Size of pre-development costs, representing up-front costs and risks Source: Interviews 1. Research has found similar biases in infrastructure spending too. See Flyvbjerg B (2009),Survival of the unfittest: why the worst infrastructure gets built and what we can do about it, Oxford Review of Economic Policy, Volume 25, Number 3, 2009, pp Bolton T and Wilcox Z (2011), Investing in Growth Cities: Fulfilling the economic potential of the Greater South East cities, London: Centre for Cities 5

6 Developing interest - appendix: March 2013 Appendix 4: Size of Local Enterprise Partnerships Local Enterprise Partnership Population London 8,204,400 South East 3,987,700 Leeds City Region 2,954,700 Greater Manchester 2,685,400 Derby, Derbyshire, Nottingham and Nottinghamshire 2,110,300 Greater Birmingham and Solihull 1,946,500 North Eastern 1,933,400 Coast to Capital 1,926,700 Sheffield City Region 1,735,700 South East Midlands 1,715,600 Heart of the South West 1,667,100 Enterprise M3 1,633,900 New Anglia 1,589,600 Solent 1,547,200 Liverpool City Region 1,506,500 Lancashire 1,461,300 Greater Cambridge & Greater Peterborough 1,371,300 Black Country 1,141,700 York, North Yorkshire and East Riding 1,133,700 Hertfordshire 1,119,800 Stoke-on-Trent and Staffordshire 1,098,300 West of England 1,070,100 Greater Lincolnshire 1,042,000 Leicester and Leicestershire 980,800 Humber 918,000 Cheshire and Warrington 903,000 Thames Valley Berkshire 863,900 Coventry and Warwickshire 863,500 Dorset 745,300 Northamptonshire 694,000 Swindon and Wiltshire 684,000 Tees Valley 663,000 The Marches 657,600 Oxfordshire 654,800 Gloucestershire 598,300 Worcestershire 566,600 Cornwall and Isles of Scilly 536,000 Buckinghamshire Thames Valley 506,600 Cumbria 499,800 6

S31 Grant determination for a high needs strategic planning fund in : DCLG ref 31/2916

S31 Grant determination for a high needs strategic planning fund in 2016-17: DCLG ref 31/2916 Purpose of the fund Local authorities can use this fund to carry out a strategic review of their high needs