-Edwards (economy)

Draft Replacement London Plan / Economic Development Strategy

Comment and objection from Michael Edwards

(UCL Bartlett School of Planning / King’s Cross Railway Lands Group / Just Space Network, but here writing as an individual, not on behalf of any of these organisations.)

This submission relates only to the four most important topics on which I consider the draft Plan is deficient:

  • the growth objective and the growth assumptions
  • diversification and sectoral emphasis
  • land/property markets
  • balance between local services and centres

The paragraphs are indexed to sections of the London Plan but equally affect the EDS.  It is therefore submitted as a response to both.

Preamble:

The plan rightly aspires to reduce the inequalities afflicting London and to drive towards a low carbon economy. However in its actual provisions it is simply tinkering and gives inadequate leadership towards a different future.

The last 30 years have been a disaster for low- and middle-income people in London who saw their real incomes static or falling while wealth accumulated upwards, partly at their expense, and the quality and security of their jobs worsened dramatically.

The economic crisis is very serious. London’s economy was cushioned from early employment impacts by its low reliance on manufacture compared with some other regions (as Ian Gordon and others pointed out)  but we are very dependent on public spending – current and capital. And within the next few years government seems likely to impose severe cuts in the social wage in order to lower public debt in conformity with the Maastricht / Convergence criteria.[1] The recession is thus likely to be long and hard.

Talking about the London Plan in that context feels a bit like arranging deck chairs on the Titanic.  But I don’t think it is:  it’s worth taking every opportunity to open people’s eyes to what has been happening and to explore alternatives. The urgency of the global warming issues further helps create an atmosphere in which people want to think about a future different from the past. Tinkering with the ‘back to normal’ assumptions is all the Draft Plan (and the EDS) does.

Chapter 1 generally, and chapter 4

Growth

Pursuing growth of GVA is a badly-specified objective. All versions of the LP have aimed for growth in GDP / GVA but the twin crises in the economy and environment make it imperative that we re-think this desideratum because:

  1. It omits environmental costs and other externalities
  2. It ignores voluntary work and unpaid domestic labour, both huge in London
  3. It shows illusory growth where we just pay more for the same goods or services – notably housing and other ‘positional goods’ [2]
  4. It over-values the work of  (for example) bankers[3]
  5. It under-values the output of most public service work
  6. It disregards changes in inequality.

If the Mayor is serious about the importance of ‘quality of life’, and about ‘driving towards a low carbon economy’ this way of measuring success has to change.

The approach to growth forecasting.

All the Mayor’s strategies share an approach to the economic crisis which must be wrong. The common Evidence Base presents (in fig 4.2) a number of expert forecasts, all of which acknowledge and foresee a major downturn followed by renewed growth.  The same figure shows that the Mayor’s strategies have chosen to ignore the crisis and plan on the basis of uninterrupted growth.

The planning team defend their decision by saying (a) that there would be severe damage caused by under-estimating infrastructure needs if optimistic forecasts turned out right and the plan had been based on pessimistic forecasts, and (b) that one role of the plans is as a basis for negotiating funds with government, so it helps to have high levels of need embodied in the plan.

The GLA held an alternative economic scenarios seminar in the summer but it was a “closed” event and the feedback we have is that the focus was narrow, only looking at small differences in growth rates as sketched in the IIA. This does not meet the requirement.  We need our Mayor to unite Londoners around a radical strategy to deal with the economic and environmental crisis through the pursuit of broadly defined growth of social output.

These strategies of 2010 (LP, EDS. TfL) can serve Londoners best by acknowledging the severity of the economic crisis and focusing on how to build recovery, protect the vulnerable and take advantage of the special opportunities which the crisis may present[4]. I consider the present draft London Plan not fit for purpose and would like to see it sent back for re-working on more pessimistic economic assumptions, or at least with both optimistic and pessimistic scenarios included. Since the planners have suceeded in reviewing the plan every few years, forecasting mistakes can be picked up in the next revision.

Policy 4.10 New and Emerging Sectors (and chapter 4 more generally)

Sectoral focus

The Plan is still too preoccupied with glamorous sectors, those producing high GVA per capita. If we are serious about poverty (or even just about recovery of GDP) we need to target the non-sexy sectors in which low pay is the norm and look for ways to raise productivity there, and thus wages, support those firms and public+private services, especially the ones which offer entry-level jobs to those without much qualification, and progression thereafter. Retaining and encouraging existing enterprises is just as important as seeking inward investment and encouraging startups.

It is good to see a slight change of emphasis in this direction in the EDS and good also to see that ‘innovation’ is to be targeted especially at SMEs.  However these appear to be slight changes in sentiment only and are not carried through into policy, especially in the London Plan.

Meeting with the London Plan team in July 2009, the Just Space Network said (and followed up with a written statement) how important it was for the research programme to look carefully at the needs and potentials of each sector at a fine grain level. Of all our suggestions, this was the top priority (see appendix) but there is no sign of this work being done.  Even if it were right for London to be pursuing maximum GVA (which I dispute – see above), it is illogical to do so just by further efforts to expand the high-GVA/worker sectors. The poorest employed Londoners are in the other half of the economy: retailing, cleaning, security, transport and vehicle maintenance, elderly and child care. Innovation policies and supportive planning policies which raise productivity (and thus potentially pay) in those sectors could make major contributions to GVA and to poverty reduction.

Policy 4.4 Employment Land, and with implications elsewhere, especially on Density Policy 3.4 and housing

We must find ways to lower expectations of land value growth, especially for housing.  Clearly the surge of money towards the acquisition of land and buildings has pushed land prices in the UK (and especially London) to dangerous levels, diverting investment from productive channels, excluding people from housing, lowering the quality of new housing, redistributing wealth upwards and – through its immense fragility – now contributing to the economic crisis.

The London Plan / EDS alone cannot bring about the massive re-structuring of the economy which is required to produce a sustainable future: many measures will have to be devised and taken at supra-national and national levels.  However there are things which can and must be done to mitigate some of the effects in London.

One pressing need is to reverse the almost-open-ended incentive for residential densification which has grown up over the last decade.  This has contributed to raising residential land values and developer and landowner expectations and thus, among its many effects, displacing almost everything else. Land prices for residential development in London were so high in the decade up to 2007/8 that other uses could scarcely ever compete. This powered the attrition of industrial and employment floorspace and provided a basis for naive neo-classical economists to argue that many other uses, notably suburban office, industrial and workshop buildings, were ‘non-viable’.  Housing densities regularly exceeded those permitted in the density matrix and apparently continued to do so in 2008.  The highest densities have been the subject of strong attack for their urban design effects, for their effects on play space and family living quality (and the draft Plan goes some way to dealing with these criticisms).  However this effect via the land market – on displacing economic activity – has not received attention and should do so for the way it impacts in thousands of small developments across most of London with strategically-damaging cumulative effects.  At the very least this means that the maxima set in the density matrix must be strictly enforced, with no provisions for further density increments to be sanctioned for any reason at all.

Policy 2.15 Town Centres, 3.7 Large Developments, passim

Decentralise. Overturn the Plan’s obsession with centres as the places where everything has to happen.  It’s good for corporate real estate values perhaps but it’s very old fashioned. Furthermore the plan is still imprisoned (on the centres topic) by an implicit concept that only BIG things are strategic although other areas (density controls, open space) it acknowledges that the cumulative effect of many small decisions are the proper concern of a strategic plan.

The “lifetime neighbourhoods” concept comes to our aid here, as does the imperative to reduce the need to travel.  Lifetime neighbourhoods calls for us all to have, within walking distance of home, a set of basic facilities – shop, post office or somewhere to collect internet and mail-order parcels, a chemist, child-care and other services.

If activities generate a lot of employment or longer-distance movement or trip-chaining they need to be on public transport routes but they don’t all have to be in ‘centres’. There are no agglomeration economies to be had in car repairs or care homes or builders merchants or primary schools; quite the reverse.

All of this calls for a complete change in the GLA’s approach to services, including retailing, from a top-down to a bottom-up (or more precisely a multi-scalar) approach. This will call for modernisation of technical approaches to take advantage of the rich understanding now available of local behaviour patterns in relation to wider scales [5] and would permit the development of a strategic planning tool comparable in value to the density matrix.

In the meantime, however, there is much that could be done.

It is good to see that the OLC and the London Plan have decided against the suburban mega-centre idea. But the plan should go further and positively encourage the  dispersal of additional comparison goods shopping (where agglomeration economies are important) among London’s centres in the interest of shortening trips (especially car trips) to such centres.  It is particularly important to shorten the long and toxic trips which many of us make by car to Bluewater or Westfield and the best way to do that is to ensure there are attractive shopping centres nearer home.

For certain kinds of retailing – heavy/bulky goods – car trips will be impossible to eradicate and, for these, policy should favour the creation of new stores in areas not already well-served, purely in the interests of shortening trips.

More generally, the support for local services needs to have a higher priority in policies for street management and parking to enable enterprises to load and unload more readily. And to level the playing field between local services and malls/superstores, and reduce the incentive to drive, the Mayor should use his powers to tax parking spaces on private land.


[1] The £ 850 bn the UK has spent on bailing out the banks is going to be recouped from all of us through tax and service cuts.  Thus the social wage will be savagely cut, adding insult to injury for a great majority of the population.  There will also be direct and indirect job losses as the negative multiplier effects work through. It has cost British people about £14,000 per capita to play host to these banks

[2] Hirsch, F (1977)   The Social Limits to Growth, London: Routledge

[3] The only GLA research on how GVA is measured seems to have been a study which attempts to massage upwards the productivity estimates for ‘financial intermediation’ to boost the Crossrail CBA (GLAE WP23 2007). For a (rather crude) contrasting approach see Steed, S, H Kersley and E Lawlor (2009)   A bit rich: calculating the real value to society of different professions, London: NEF http://www.neweconomics.org/publications/bit-rich

[4] The recent work of Barrass has shown how normal is the boom and bust process in London and how counter-productive it is just to think in terms of underlying trends. Barrass, R (2009)   Building Cycles: Growth and Instability, London: Wiley

[5] Vaughan, L, K Jones, S Griffiths and M Haclay (2009)   The Spatial Signature of Suburban [London] ‘Active’ Centres, Seventh International Space Syntax Symposium, Stockholm http://eprints.ucl.ac.uk/15021 ; Alain Chiaradia and Christian Schwander  IVALUL project with LB Tower Hamlets, Urban Buzz, London 2009.


3 Responses to “-Edwards (economy)”

  1. Twice the term liberal is used almost as an insult. As a liberal i resent the implication, I also resent that a response to a planning document has to have a political undertone. This draft London Plan will replace the most important planning tool we have and warrents real attention and care to respond not just to its contense but to its lack of content. The document is our toolbox to fight off inappropriate applications in our areas. It needs to be robust and have the legitamacy of having been properly consulted on. This has not happened. I recieved notice as a reminder of when comments should be submitted by only last week. Where was the circulated notice of Local Authority consulting List. Is it just my LA (Hillingdon) who have failed to notify any resident association within its area that the document was available and due for comment? Or did this become merely a tick box exercise where the GLA avoid where possible the need to deal with local reactions and concerns.
    Hillingdon is hugely Conservative with such a large majority that they feel able to treat their electorate with contempt. The arrogance shown in whipped planning decisions, changing of members to get the result wanted by the party, total breaching of due process on a regular basis has gone a long way to turning off the local interest in planning. the attitude now is that since we won’t be listened to why bother. We have had many discussions about it at the Hillingdon Residents Association gatherings and many of us intend to stand in the next local elections to try to rearrange the balance.
    I therefore combed this document for references to community involvement and a toughening of the need to consult. The SCI have become tick box exercises as i fear this document’s consultation has also become and any pretense at democracy or giving the community the right to decisde the future shape of their environment (as required by PPS 1) has completely left the building.
    I am disappointed then that there is not an outcry at the lack of local control. Our best and most ecperienced planners have all been abducted into the policy teams going round and round in circles producing the worst set of planning tools in history. Those planners left are transitory, inexperienced, have little qualitifaction and absolutely no local knowledge. it is truely the worst thing to happen to local planning. Because in the mean time the PR guys paid by Tesco have toured the Country influencing the SSD befor any community ever gets to see them. Their influence is evident throughout this document too. You refer to filling in spaces where no store exisits. In the real world out here there are no spaces lewft. Communities are still being wiped out daily and the process at locl levels gets harder and hard as the appeal process proves to be fair and a listening process. This means more bullying, more bribery and submissions absolutely fuill of out and out lies. We have had several teams address the lies through the ASA and win. But the actual submissions and the honesty of their content has to be addressed and made to have consequences for those who lie and a language that makes involement in planning a possibility instead of an ever growing lllllllanguage of its own with trip rates and sales densities, catchments which bear no resemblance to fact and double or treble use of the same households to justify ever more and more stores. Tesco is arrogant and dishonest. They do not listen or consult and have developed an extreme method of dealing with applications even down to designing out controls normally put in place by LAs.
    Communities must be listened to and the attitude of DCLG needs to infiltrate major application teams round the country because the attitudes vary considerably. Retraining (with the new document or a beefed up version) as an excuse to do so would be a revalation in local planning.
    Development needs to be better assessed by the area being able to take it without detriment or irreversible damage as previously suggested. I grew up moving from one brand new estate to anopther as we toured the country. Each time the library, school, health centre and local store were built prior to the housing it was to service. In this end of Hillingdon we have had an increase of 24% in our population filling the entire Borough’s target many times over in just three years. We have meanwhile been identified as an area of health deprivation (shorter lives) and yet get no where with insisting that the 12 year wait for the promised new health centre should be built before any further new housing units. The system is the wrong way round and doesn’t take enough account of the ability of local services to cope.
    Land value growth and housing price increase is all part of the same problem. Our Government seems to have become entrenched with the gambling habit. All new growth or renewal does not have to rely on a huge supermarket to supportit. In fact its the opposite. The net loss of jobs, the loss of local shops selling local produce, the moving of centres to out of town and the redirection within towns of the parking and walking routes to suit the supermarket chans is a rediculous way to proceed. No wonder the idea of community is dissappearing. The social needs are mis represented and have to start with stability, the involement of people with a long term interest in the areas (most small store woners stay for thirty years of more) and they are the glue that holds communities together.
    Twenty small stores in a High Street dictate a place where people meet, talk, notice when others are not arround, care about anti social behaviour, graphittii and policing. A supermarket is a one stop shop designed to get you in fleeced and out again as fast as possible because any more than a 25 minute dwell time means they have insufficient parking provision for the next customer. Parking free in their own car park or by giving back ticket prices from a public car park do influence where people shop and we should not be discriminated against for preferring to shop where the sources of our food are known and have only traveled a short disance to get to the store. Even when discribed as local produce the supermarket product has travelled many miles away for washing packing and labelling to be returned ‘locally’ for sale. Another one of the lies.
    If the emphasis could be changed to reflect value and sustainability (the real thing not that promoted at present) then why do house prices have to go onj rising? Why do more and more of the electorate have to be excluded from the ability to aspire to own their own home (without it costing us the taxpayer and incredible amount to support with loans and partial ownership) and if land values could become more stable then other forms of investment would have morte attraction than the present trend to land bank. Land banking should be addfressed and not by the misguided Chamber of Commerce suggestions of business rates on empty buildings. A God given excuse to pull down a sustainable and flexible building to create a bomb site the the locall community will accept any monstrosity on rather than keep their rubbled site in the centre of thir town!
    The recent emphasis on quality of buiuldings (PPS 6 rewrite also has this) has led to the development of throw away buildings instead. Tesco have regularly been made to accept that their new buildings cannot meet the standards of carbon footprint and power conservation required by 2016 so why give them permission to errect a plastic,sheeted, steel framed wood lapped edeface that will have to come down in ten years, because its building in an excuse to have to enlarge the replacement store them to cover redegvelopment costs to meet the required standards. Do they really think we are that stupid that we can’t see what they are doing.
    There is so much wrong with the system which is not addressed by this document and making political asides and missing the main points entirely does us no good what so ever!

  2. Dear Gaynor

    I deeply appreciate your comment on my draft. (version above is since revised)

    (i) I am changing my personal submission to make it clear that (if I have to use the word “liberal” at all it is nothing to do with the liberal party (or what americans call ‘liberal’ (=leftish). It relates to an economics concept, championed by Thatcher and co….. de-regulation, market orientation and so on. But I’ll probably remove the word altogether. So thank you.

    (ii) I have been working on all this with lots of other people in a network and the overall submission for the Just Space network has stuff in it about the overall importance of local democracy etc. My personal submission (on which you commented) concentrates just on the topics where I’m plausibly an “expert”.

    (iii) I do urge you to send your text (just cutting out the bit to me about “liberal”) as a submission to the Mayor. You could do it in ten minutes, emailing it to him as suggested on our web site!

    Very best wishes. Michael

  3. 3 francis knox

    This is to confirm that I will be attending the first two days of the EIP but will
    probably not want to apeak. Among other things, I have recently become slightly
    deaf and may have difficulty following the proceedings!
    The main points I am interested in are the effects of the continuing growth of
    London, population and employment, on surrouding ciounties, esepcially Kent,
    Sussex and Surrey, where s very high proportion of land is “designated” or protected (AONBs etc.) and there is consequently little scope for building on
    greenfield land. The “Key Diagram” in the Plan shows big outward expnsion
    along traffic routes- the Thames Gateway, London-Cambridge, London_Peterborough, the Wandle Valley, and another to teh SW (I do not have a
    copy in front of me at the moment). I regard the first three as very suitable for
    large-scale building (but the Essex, not the Kent, side of the Thames Estuary) but
    would be very dubious about expansion southwards or westwards.
    The Plan, like the two previous oens, says that it is
    possible for London to expand in population and employment without impinging on
    green spaces in London or the Green Belt. On the evidence of the past 30 or
    40 years (I think this sort of time span is needed to appreciate what is happening)
    or even the last five or ten years, I think the latter is unlikely- it is probably true that infringement of London s green speaces would meet strong opposition, but this is less true for the Green Belt and areas beyond it.
    I would hope that the London Green Belt Council
    would make some comments on these issues. It seems rather an elusive organisation, with no postal address thay I have been able to find, but I understand
    that Theresa Villiers, M.P., who has become one of the Transport Minsiters in the
    new government, is one of its leaders.
    I would hope, and expect, that one of the cost-
    cutting measures the new governmenty will take would be to move more employees
    out of London to other regions, e.g. central department civil servants. The London
    allowance for most of these is I think about £4,000 a year (£6,000 for police officers) and there would also be lower office rents.
    I am currently writing a series of pamphlets on
    “Re-shaping Britain: the levers of a new regional policy”, under the “Farsight
    Research” title and will put the first on sale next week.


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