By Neil Merrick
Regeneration programmes that rely heavily on private finance have been severely hit by the credit crunch, according to a government report.
Regeneration programmes that rely heavily on private finance have been severely hit by the credit crunch, according to a government report.Deprived areas, in particular, need extra Treasury support as private investors steer away from schemes that are seen as too ‘risky’, according to the study by Professor Michael Parkinson.
The report, published by the Department for Communities and Local Government, said schemes that had suffered setbacks might take years to recover while public money was critical to others continuing during the recession.
‘This contribution will be even more crucial in the coming months,’ it added. Parkinson, based at the European Institute for Urban Affairs at the Liverpool John Moores University, was commissioned to write the report last May by local government minister John Healey.
The credit crunch and regeneration, published on January 30, said pressure on existing and future schemes was likely to increase with ‘economically-marginal’ projects in the North and Midlands seen as least attractive to private investors.
Parkinson said: ‘The credit crunch has shaken the sector. But however difficult the market is now, it is not dead.’
Responding to the report, Healey said the government had already brought forward £775m for construction and regeneration.
