In light of the UK Government’s spending cuts for urban regeneration, the public sector must prioritise its regeneration spending to engage the private sector

More clarity is needed on what the Government deems to be ‘lower value’ RDA spend. With public sector budgets so stretched, it will be crucial to use clear tests to demonstrate which regeneration projects are viable and should be prioritised for investment.

The focus should now be on regeneration projects where public sector money can help to de-risk and facilitate private sector investment.

This would not necessarily take the form of a grant, but could involve public bodies taking an equity stake in a scheme, allowing them to benefit from any future uplift once projects are delivered as well as sharing risks.

Flexibility for local authorities will improve efficiency. The greater flexibility being given to local authorities in removing ring-fences on grants will help local government to achieve spending efficiencies in regeneration areas, in line with the Total Place agenda.

The Durham Total Place pilot, for example, showed the benefits that can be gained from aligning different funding streams focusing on housing and economic development through co-ordinating timescales and management of funds.

These efficiencies will be critical given the economic pressures currently facing the public sector.

Tim Johnson is director in development consulting at DTZ