October 7, 2009
Community engagement – a target for cuts
The SNP Government’s draft budget for next year will for first time since devolution, impose a real terms cut in public spending. No doubt there will be much horse trading as the final budget is negotiated through Parliament but it seems certain that severe cuts are coming. Early indications are that housing and regeneration are going to be hit hard which will include reductions in funding for community engagement
For housing and regeneration practitioners in Scotland, 2010/11 is shaping up to be a tough financial year.
The Scottish Government’s draft Budget, published earlier this month, reveals that spending on housing and regeneration in 2010/11 is likely to be nearly 40 per cent lower than in 2009/10. The draft Budget is subject to approval by MSPs but, as it stands, £33.5 million will be spent by the Government on regeneration in 2010/11 – down from £118 million in 2009/10. The plans in the draft Budget would also see investment in affordable housing fall from £583.4 million to £414.5 million over the same period.
The huge reduction in available funding for Scottish regeneration results mainly from the loss of the £60 million Town Centre Regeneration Fund, which only had a one-year lifespan. Nevertheless, other renewal budgets, including funding for community engagement, have also been reduced. Meanwhile, the £169 million drop in affordable housing cash is largely due to the Scottish Government’s decision to bring forward investment from 2010/11 to spend this financial year on keeping affordable housing construction moving during the recession. In bringing forward the funding, the Scottish Government has succeeded in doing as it intended. But the move has also left what the Scottish Building Federation has described as a “black hole” in the 2010/11 housing budget.
So what happens next? The Scottish National Party’s minority rule means that it needs support from other parties to get its Budget approved and so it may have to make concessions to win enough backing when MSPs vote on the Budget at the start of next year. The Town Centre Regeneration Fund was included in last year’s Budget in order to win the support of Conservative MSPs, so similar concessions should not be ruled out.
However, fears have been raised that the Budget in its current form will deal a fresh blow to Scotland’s regeneration sector, which is already struggling to get to grips with a new regeneration structure introduced last year by the SNP (see Feature, p18). There is concern that councils, which inherited regeneration functions from economic development body Scottish Enterprise, are finding it hard to master their new duties. Given the looming funding gap, it is vital that the Scottish Government acts to iron out these difficulties, and quickly.