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Review of Scotland's Cities - The Analysis

5 LIVELY CITIES

The previous chapter concentrated on the homes and neighbourhoods that make up the bulk of land uses within our cities. But in using cities and in choosing whether or not to live there, residents have regard, as the quality of life studies showed, to a range of city attributes and services which are concentrated at points or within specialised districts within the city.

Sub-centres for entertainment and shopping are important, not least in the suburbs of the city-region, but it is the city centre that is the essence of "cityness", the reflection of scale, centrality and variety. City centres matter - Scotland's city centres are of crucial importance as magnets for shopping, tourism and leisure. Strong vibrant city centres are key anchors against de-concentration and they retain a link between core cities and the rest of the city-region by attracting commuters, shoppers and service users. For business visitors and tourists they are, to an often unrecognised extent, shapers of the image of Scotland - Scotland's 'shop windows'. This chapter examines the public realm at the core of the cities and then considers how retailing, leisure and tourist activities impact on the cities.

5.1 THE CITY CENTRE AND THE PUBLIC REALM

City centres are relatively specialised in that they contain relatively low shares of residential activity and minimal amounts of manufacturing. Services, retailing and public spaces dominate. A range of factors make for a competitive city centre - a quality public realm, with pedestrian friendly spaces; good transport links to the city centre; the pull factor of good shops, museums, and culture; better design, promoting high quality, complementary development; events, cleansing, lighting, signage, marketing and promotion, security, etc.

Clearly these different requirements may be contradictory, and in many senses this is the secret of successful city centres. People wish freedom to express themselves and meet new people, but they also want security and safety. Shoppers wish ready access to the core, but to have pedestrianised spaces free from cars. City centre residents want 'buzz' but they also want to have peace and quiet in their homes. Planning, designing and managing city centre spaces to reduce these conflicts, to reduce the effects of negative 'spillovers', is a complex challenge to which our cities have responded well over the last decade or two.

The range of measures outlined above can contribute to:

• making the city centre (and the city more generally) a more attractive place to live;
• attracting new business development, and in particular headquarters development;
• enhancing the competitiveness of the retailing offer;
• enhancing the attractiveness of our cities to tourists; and
• more generally acting as the 'shop window' for a city.

The intangible benefits of improved confidence and shared vision for private sector investment should not be neglected. This is an area in which good, co-ordinated public action can reduce negative spill overs and investor uncertainties, with considerable leverage obtainable from public spending. For instance, the 10 million invested by the public sector in Buchanan Street (Glasgow) complemented and added value to the private sector investment of 100 million in Buchanan Galleries.

The previous chapters drew attention to important gaps in benchmarking city economic performance and neighbourhood quality. Not enough is being done to track the relative competitiveness of our city centres across the different ranges of competition they face, whether locally or nationally. For instance, city centres face competition from city edge shopping and retail outlets. Around 9% of Glasgow shoppers surveyed felt that their spending in the city centre had fallen as a result of the opening of the Braehead Centre. And competition from other cities (not least in England) is growing for discretionary leisure and recreational spending. If our cities fail to offer a 'competitive' product, essentially the range and quality of retailing and services and the quality and safety of the public realm, we risk losing investment and spending elsewhere. If investment/spending moves to edge of city retail/leisure parks then urban sprawl and unsustainable transport patterns will result. If cities outside Scotland are the gainers, then Scotland as a whole will be the loser.

There is evidence within Scotland and elsewhere in the UK that strategic investment in the city centre public realm, as part of an integrated package of measures, can have a significant pay off. The two case studies below outline the results of a major upgrading of public realm quality, focused around the prime shopping street in Glasgow, and the comprehensive revitalisation programme currently underway in Newcastle-Upon-Tyne city centre.

Yet responsibility for improving the public realm is fragmented and the priority attached to the issue across Scotland's 5 cities has varied considerably in recent years - see Table 5.1 below. Dundee, which has been quite explicitly trying to re-establish its role as a regional centre, and Glasgow have invested sizeable sums in their public realm, drawing in particular on Local Authority, LEC and ERDF funding; Aberdeen and Inverness have invested rather less with Edinburgh almost entirely relying upon its inherited public realm (and in all the expenditure is modest in contrast to the expenditures noted in the Grainger case study).

TABLE 5.1: Public Realm Expenditure 1991-2001

Source: Town Centre Managers
*figures for individual funders not available

The relative success of Dundee and Glasgow illustrate that given adequate priority it is possible to pull together sufficient investment resources to make a difference, but much remain to be done in all 5 cities:

Aberdeen - The city centre has seen significant activity, including pedestrianisation of several streets, conversion of derelict buildings into homes, improved tourism attractions, promotional and city centre management projects, but the big challenges remain. An Urban Realm Strategy has been prepared proposing 5 key projects over the next 5 -10 years: increasing pedestrian priority on Union Street; creation of a civic square at Broad Street; better integration of private sector housing developments with the city centre core; improved management of and access to Union Terrace Gardens; revitalising the Castlegate area by promoting a cultural quarter and refurbishing key buildings; plus ongoing city centre management initiatives such as maintenance & cleansing, facelifting & floodlighting, tourism events and public art and events.

Dundee - Considerable progress had been made. Looking ahead, further investment capital for the city centre is available, though it is harder to find the investment for secondary retailing areas. Maintenance is the key problem, with significant pressures on council budgets. The quality of the capital works mean that public/business aspirations for quality maintenance have been raised.

Edinburgh - Edinburgh's city centre public realm is under stress and is generally recognised to fall short of what is expected of a city of major European standing. Much of the investment to date had come from roads/transportation budget, but these sources are now under considerable pressure from other quarters. The City Centre Strategic Audit, recently conducted by the partner agencies, has resulted in work to develop a City Centre Public Realm Strategy. Future aspirations for Princes Street alone are in the region of 50 million. City of Edinburgh Council is undertaking an initial investment of approximately 2.5 million in city centre public realm improvements, but a long term capital funding package is not in place and likely delivery is in the order of 10-15 years, when 5 years is more consistent with the competitive challenges faced by Edinburgh city centre. There is also a shortfall in maintenance funding.

Glasgow - There has been sizeable spending on the Sauchiehall Street, Buchanan Street, Argyll Street core, as part of a package of economic, transport and social investment. Looking ahead, investment in the public realm is planned for the Merchant City (where ERDF and Heritage Lottery Fund monies will be available); the Broomielaw which might receive developer contributions; and in the longer term George Square. Funding was not yet in place for the second and third of these and competition between the city centre and outlying residential areas for resources remains an ever present issue. There is also an on-going maintenance requirement if the public realm improvements are to be maintained to a high standard.

Inverness - Inverness is only just beginning to focus on the issue. Existing pedestrianisation is now showing its age. Plans to extend city centre pedestrianisation to Union St, Church St and Queensgate are contingent on the Cross rail-road link to remove road traffic from the city centre core. Total price tag of the improvements and the link is 11.3 million, of which 4 million will come from the private sector.

But available evidence suggests that the funding available is likely to fall significantly short of what's required to deliver local aspirations. The main non-local authority sources of capital funding for new works are not guaranteed in future:

Enterprise Network funding will continue to be available where city centre public realm projects can show beneficial outcomes in line with the guidance from the Executive in 'A Smart, Successful Scotland'. But priorities vary at the local enterprise company level. SE-Glasgow and SE-Tayside funding will continue but probably at lower levels and more selectively, reflecting the sizeable expenditures of previous years. SE Edinburgh and Lothian have identified public realm improvements as a priority for future action, by contrast SE-Grampian and Inverness and Nairn LECs are unlikely to prioritise their respective city centres. In Chapter 3 it is argued that the Scottish Enterprise Network needs to revise its appreciation of geography and be seen to give due attention to economic issues which relate to place and property investment. Public realm investments fall into that category.

ERDF funding has contributed significantly to public realm improvements in the past. But the current west, east and south programmes and the transitional programme for the Highlands and Islands were all due to end in 2006. There has been no decision in Brussels about the size and shape of any successor programmes, but it is certain that the total of funding will be much reduced.

Historic Scotland and the Heritage Lottery Fund are likely to continue as niche players only.

The key Heritage Lottery Fund programme is the Townscape Heritage Fund. Scotland has received some 13.5 million from this source allocated to 15 schemes, but only two in the cities (the Merchant City, Leith). A number of other cities had applied in the first round and had their bids rejected, and none have applied since. Three more rounds were planned up to 2004/5. Revised bids from the cities would be welcome, but they would be competing with market towns, country parks projects and rural heritage initiatives and are not currently viewed as priorities.

Historic Scotland spend is likely to continue broadly at recent levels:

TABLE 5.2: Historic Scotland: Grant Expenditure by City Area

It is noticeable that Edinburgh had done particularly well at accessing Historic Scotland grant funding. The Edinburgh World Heritage Site Trust (and its predecessors the Old and New Town Trusts) acts as a local agency vehicle for receiving block funding from Historic Scotland and dispersing small scale grants to private owners. It has led the development of a proactive strategy for the built environment and encouraged private landowners to invest in repair and renovation. The Heritage Trust model might have a role to play in the other 4 cities and possibly elsewhere.

And the burden of maintaining/servicing city centres currently rests almost entirely with local authorities, who have to balance the respective needs of the city centre and localities (the main non-local authority funders of capital works - ERDF, Scottish Enterprise, Heritage Lottery - are unable to contribute to the ongoing requirements for revenue spending). As a result, all 5 cities are experiencing problems in meeting ongoing maintenance/service needs, not least in maintaining the sizeable capital investments of recent years. It is essential that capital works have associated maintenance and management funding fully in place.

Given the scale of the challenge/opportunity facing Scotland's city centres, and the partial nature of the response so far, it will be important to ensure that the cities have the institutions and the funding commensurate with the scale of the task.

5.1.1 City Centre Strategies and Delivery

It is clear that we need better mechanisms for addressing our collective stake in our city-centre assets. The starting point must be the Community Planning process, the city centre strategy must flow from city and city-region needs. Within the context of this wider vision for the city, a comprehensive strategy and action plan is required for each of our city centres, developed in close collaboration with the private sector. This needs to articulate a shared vision and pull together diverse programmes/funding sources.

Current Town Centre Management initiatives in Scotland's cities are providing a focus for marketing and lobbying activities, but they are under-resourced, in effect living from hand to mouth. Edinburgh City Centre Partnership's income from the local authority and business in 2001/02 was only 725,000 - yet it is one of the better funded UK town centre partnerships! Central to the work of the Community Planning Partnership, is putting in place the means and mechanisms to develop, deliver and monitor the strategy. Each city needs to examine the effectiveness of current arrangements and their appropriateness for the challenges ahead, including the future role and resourcing of the Town Centre Management activity.

Given the inadequacy of existing sources of funding, consideration could be given to exploring alternative funding mechanisms, not as a replacement, but as a supplement to the more traditional sources of funding.

There is a significant and direct private sector stake in the success of our city centres (and indeed other retail and office locations around our cities and elsewhere). Retailers, property companies and business generally benefit from a quality environment, whether in terms of extra retail footfall, higher rentals or an attractive environment for employees and customers. But there is at present no way of systematically tapping into this potential value to the private sector. Voluntary approaches are frustrated by free-rider problems. As a result, much needed investment of benefit to the business community remains undone or incomplete.

Business Improvement Districts (BIDs), common in the United States, but still untried in the UK, could potentially provide a vehicle for raising collective resources for additional infrastructure, maintenance or other services in the city centre, tailored according to local circumstances. BIDs are arguably a form of community budgeting, a locally managed multi-purpose budget targeted on the city centre. As a mechanism for recognising a common interest in an area, equitably and transparently, BIDs might have a role to play in all 5 cities (tailored according to their different needs and scale). But the case will have to be made in each city and protection afforded to business interests to ensure their consent to any scheme.

Table 5.3 below illustrates the current rateable income raised from selected retail centres in the 5 cities, and gives a sense of the scale of sums that might be raised by means of a modest percentage levy on rateable value.

TABLE 5.3: Summary of Rateable Values and Estimated Rates Due

To explore this issue further, the Cities Review established a working group involving key stakeholders (City Centre Managers, City Councils, Scottish Chambers of Commerce, Federation of Small Businesses, Scottish Enterprise, Scottish Retail Consortium, Historic Scotland).

It is clear that in some of the cities there were considerable frustrations at the lack of progress on city centre improvements. There is general recognition that voluntary contributions are resulting in under-powered city centre partnerships. The business sector appears in principle prepared to accept the introduction of BIDs, but the climate has been soured by a history of adversarial relations at local level and concerns about additional financial burdens on business. The business sector therefore needs to be made central to the introduction of BIDs, and this will involve explicating a much clearer private sector contribution not just to visions but real action plans for the city centres. Full and open consultation and engagement is essential to explain the workings and objective of the BID proposal and councils will have to take clear, open leadership roles in these partnerships.

Scottish Ministers have announced that they propose to consult on the introduction of Business Improvement Districts in Scotland. The following considerations might usefully be taken into account in such a consultation.

New strengthened public/private sector delivery vehicles would have a crucial part to play, pulling together funding contributions, levies and planning agreements. Provision would also be required at the local level concerning the long-term maintenance of any capital works.

5.1.2 Making the Centre a Stage

New funding mechanisms, and better informed partnerships to promote investment and services in the public realm, especially in the city centres would renew their strengths and create stronger cores in the city-regions. Changes have to emphasise the diverse interest of business but also residents who live in the city core, and there are growing numbers of the latter. Cleanliness in the public realm is important and so is the design of buildings and spaces. But security, for businesses, residents and shoppers is also a concern.

Public order in the public realm of the city centre is not just the responsibility of the police, but of property owners and citizens themselves. The solution to the problem of disorderly conduct by the young going beyond 'play' has to be owned by these groups and the city centre stakeholders. There have to be renewed attempts to design to minimise crime, not just for individual buildings but in the integrated design of wider 'quartier'. Encouraging higher levels of activity, with more people using the streets, with more people as residents in new or renovated property, can be as effective as CCTV and other related surveillance measures. Partnerships, public commitment, people on the streets will all help safety in the city centre but so also does, in the required times and places, reassuring policing.

There is much that the cities have progressed on this agenda over the last decade but there is obviously much more to achieve. Because as the next sections show city centre usage is set to rise.

5.1.3 Retailing Choices

Cities have long been important centres of consumption. Far removed from their humble origins as local market places, today's cities potentially offer shoppers an array of goods and services sourced from around the world, in shopping environments which have often elided the boundaries between necessary household activity and entertainment.

As one of the most significant sectors of the economy, retailing is one of the largest Scottish urban employers. But more than this, the quality and range of a city's retail sector reflects on and contributes to its vibrancy, image and attractiveness to residents and visitors alike. A growing and dynamic retail sector can help restore and rejuvenate our cities; a deteriorating retail offering can play its part in undermining the image and reputation of an area. At its worst, lack of retail amenity can result in abandonment and dereliction of key central property, and the loss of consumers and their spend to locations outside the city. Alternatively, at its best, well planned retail space has the potential to bring our cities to life - contributing to multi-functional centres by helping create city 'buzz', attracting a range of different types of people at different times of the day, generating business for other city centre attractions and services.

5.1.4 The Inheritance

A number of factors, from organisational restructuring in the retail sector to changes in planning policy and increasing car ownership, have dramatically altered the retail landscape of Scotland (and Western Europe) over the last decade. These factors have operated in a climate of increasing retail activity, as real incomes have risen. Estimates of retail sales in Scotland suggest an increase from 13 billion in 1994 to approximately 19 billion in 2000.

Throughout the 1990's, there has been significant market concentration, with large firms growing faster than smaller independents. It is estimated that currently ten firms account for approximately 40% of Scottish retail sales. The 1990's also witnessed significant agglomeration of shopping outlets, with an increasing preference for larger, modern properties. Thus, whilst the number of shops in Scotland declined from around 30,000 to 22,500 through the 1990's, retail floorspace actually increased over the period. The opening of large shopping centres, often in 'out of town' locations, accounts for the majority of additional floorspace. This has resulted in a significant redistribution of retail sales from traditional High Streets, including city centres, to peripheral shopping malls. And traditional suburban retailing has been affected by the same developments, indeed vacant shops can be seen in prosperous inter-war suburbs.

The growth of out of town shopping centres resulted from a number of factors: market-led demand for larger units; increasing mobility on the part of higher spending consumers; and the adoption of a less restrictive approach to out of town developments by the then Conservative government in the 1980's.

The relative shift to out of town shopping has offered the consumer considerable benefits in choice, quality and price competition. Comparisons of UK and US experience reveal that land costs comprise a much higher proportion of retailing costs in the UK, and this holds true for Scotland. But it has also had sizeable negative effects on our cities: it has not only threatened the vitality of our city centres and local suburban centres, but promoted car use with associated congestion and pollution, contributed to urban sprawl, and by creating differential access, limited the services available to those who do not have access to a private car - amongst whom are many of the most disadvantaged of our city residents.

The contrasting retailing fortunes of Glasgow, Edinburgh and the other three cities in the 1990's is discussed in the boxes below.

National Planning Policy Guidelines on Town Centres and Retailing (NPPG8), published in 1998, set out to protect and enhance town centres. When considering proposals for new developments, planning authorities are obliged to adopt a sequential approach to site selection, with town centres being the first choice, followed by edge of town centre sites and then out of town sites. This approach acknowledges that self-contained out of centre shopping malls tend to be disconnected from civic space and do not have a positive impact on the rest of the city. Instead, policies favour town centres because they are, usually, accessible by a range of transport means and for many people constitute the focal point of community life.

Out of centre shopping developments are still acceptable in particular circumstances, provided that they cater for a need which cannot be satisfied by development on a town centre site or a site on the edge of town - for example, units for the sale of bulky goods which are generally inappropriate for and difficult to accommodate in town centres. Such developments should also not affect the vitality and viability of the town or city centre and should be accessible by a range of transport, not just the car. NPPG8 has been largely welcomed by the retailing sector, particularly by smaller outlets. Chains such as Sainsbury and Tesco are also moving into more central locations, partly as a result of the planning system, but also as a reflection of their desire to develop new store formats to attract cash rich/time poor customers. This strategy captures trade not only from the growing number of high earning city centre workers, but also the new urbanites who are increasingly choosing to live in the city centre. Out of town development is currently at its lowest since the early 1990's, while town centre development is at its highest since the 1980's.

It is perceived that control of major retail development at the city-region level is less strong following local government reorganisation. This can result in Councils competing against each other for major retail proposals. NPPG8 Town Centres and Retailing provides a basis on which decisions on such proposals can be taken on a consistent basis. The Scottish Executive is planning research in 2003 to monitor the effectiveness of NPPG8.

5.1.5 Looking Ahead

The Scottish Executive commissioned research on the future of retailing in Scotland ⁵⁰ which forecasts that by 2015:

• retail sales in Scotland will increase to in excess of 26 billion
• retailer concentration will increase and 10 retailers will account for 60% of retail sales
• over 80% of food retailing is likely to be accounted for by a combination of 200 stores and e-retailing operated by 3 or 4 firms.

These trends are likely to reinforce the attractiveness of city centres and edge/out of town developments, at the expense of secondary retail areas around city centres and in smaller towns - trends which are already apparent in all the cities. The social and quality of life implications for all members of society will need to be monitored.

Looking further ahead, internet shopping represents a highly uncertain element in the retailing scene. Predictions in the 1990's suggested that the internet might account for 5 to 10% of retail by 2005. This would have had an impact on the high street; however these targets have never been realised. It is unlikely that e-commerce will effect retail shopping in the short to medium term future. However, studies suggest that likelihood of buying on-line increases with the length of time users have been using the internet. This suggests that increases in internet usage might lead to similar lagged hikes in on-line sales. The great imponderable is whether this will lead to a reduction in physical floorspace.

The 'soft' people issues of crime (both to the retailer and the shopper) and the quality of the wider public services in the city centre are likely to become more and more important in determining shopping location decisions. The traditional city centre will need to improve to compete with the managed/controlled shopping environment of the shopping mall or retail park. This will have implications for public agencies as well as retailers, and is relevant to our discussion of city centre partnerships and Business Improvement Districts in the earlier section in the Chapter.

The Scottish cities differ widely in terms of their retail provision, face different challenges and benefit from different opportunities. The question of what sort of cities we want, and the implications that different retailing patterns have is however an important question for all of our cities.

Arguably, retailing patterns of today suffer too much from a lack of policy intervention in the past. Fuelled by commercial assumptions that people with money are mobile, retail developments in the last decade have contributed to congestion, pollution, abandonment of local and city centre shops, (resulting in neighbourhood decline) and problems accessing services for the less mobile population. Yet retail provision within the cities is pivotal to the vitality and vibrancy of our cities, and requires a strategic approach. This will be an important issue for the proposed City-Region Development Plans.

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