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Review of Scotland's Cities - The Analysis

8.5.7 Community Development Trusts

Community Development Trusts (CDTs) represent another example of an 'holistic' approach to regeneration and change that those involved in the review suggested Scotland might learn from. CDTs adopt a comprehensive approach to the regeneration of both urban and rural communities and are founded upon a partnership approach with a focus on community involvement. Trusts are not founded upon a common model but most are formed as charitable companies and comprise a board of directors with a high degree of representation from the local community.

CDTs have been in existence for several decades but have proliferated since 1996 and the Development Trusts Association ⁸² now boasts over 200 members in England, Wales and Northern Ireland. CDTs were recommended as a possible model to learn from because of their success in harnessing the capacity of communities to help regenerate their own community and their ability to exploit short-term funding opportunities to create an asset base, and thereby become self-sustaining.

Having grown out of traditional voluntary sector approaches to social welfare, trusts have since expanded to deal with both the economic and environmental aspects of community regeneration. They do not explicitly exclude any particular activities from their remit and instead adopt a holistic approach to regeneration that recognises that for successful community regeneration to occur, economic, social and environmental shortcomings must be tackled in a comprehensive way.

The geographical areas that trusts cover range in size from a few hectares to large towns or rural communities and the assets that they have built from a few thousand pounds to millions in some cases. Because they respond to local needs, no two trusts are alike but the activities that they commonly become engaged in include:

• the development and management of workspace for local businesses;
• the provision of shops, market spaces and business advice;
• the co-ordination of career advice and training schemes;
• the development of vacant and derelict land;
• the management of local environmental improvement schemes and public spaces;
• the development and management of sports and recreation facilities;
• the management of community centres and offices;
• the development of play schemes and childcare centres;
• the development of affordable housing;
• support for community development.

In short CDTs engage in any activity that they deem to be of benefit to the local community. They both work in partnership with other bodies (e.g. local authorities) and directly manage and undertake work themselves.

Research over recent decades, and the Borrie Commission on Social Justice, have both found CDTs to offer considerable potential because of both the outputs that they deliver and the way in which they deliver them. Relying on bottom up approaches to regeneration, they both foster confidence in deprived communities through empowering them to take action and enhance local skill levels through their activities.

Although organisations similar to CDTs exist in Scotland, review consultees suggested that current regulations and legislation governing social economy vehicles prevent Scottish organisations from fulfilling their full potential. Others argued that the regulatory framework for CDTs was fully adequate for the wider role envisaged, and that the issues that need to be addressed concerned education, information and encouragement.

The Scottish Executive may wish to give consideration to whether CDTs offer a distinctive approach that is worth exploring in Scotland and, if so, whether permissive legislation is required to enable their development.

8.6 ENSURING SUCCESSFUL DELIVERY

Despite the excellent track record that Scotland can demonstrate in delivering change in our cities, the review also highlighted the existence of a number of barriers that currently limit the effectiveness of regeneration efforts and retard the process of change. The following section highlights those that were identified, where the review team believes there is considerable scope to improve the current situation.

8.6.1 The Importance of Pro-active Leadership

A crucial barrier to delivery identified by the review is the absence, in some instances, of pro-active, strategic leadership to tackle the priority issues facing our cities. This is particularly a problem at the city-region level. This chapter has already highlighted the importance of effective city-region civic leadership and the need for comprehensive, forward looking plans that tackle the key development priorities and opportunities facing our cities. Greater co-operation at a regional level to identify the key threats and opportunities will go some way towards addressing perceived shortcomings. Nevertheless it is vital that key stakeholders in the city take action to tackle the key development challenges facing them - particularly where challenges transcend individual local authority boundaries.

The review team also believes that the Scottish Executive has a role to play in 'flagging' national priorities that it considers Community Planning partnerships and individual authorities should proactively address through the proposed national planning framework.

Local authorities, public agencies, communities and the private sector must have a clear understanding of who will take the lead on tackling particular issues and, once agreed, must be proactive about grasping development opportunities and driving through change. This should be a role of Community Planning. At present there is a danger that, due to a lack of clarity over responsibilities, some regional development opportunities are being missed.

A particular example that demonstrates this point is the future of the River Clyde Waterfront in Glasgow. It is now universally accepted that the future prosperity of the city and its surrounding region will benefit greatly from a comprehensive, co-ordinated redevelopment of the waterfront from Inverclyde in the west to Lanarkshire in the east. A large number of separate development applications have been put forward. Following a meeting in November 2001 of public and private sector partners involved in the regeneration of the River Clyde, the Clyde Waterfront Working Group was established, chaired by Scottish Enterprise, to ensure that all parties work closely together to realise an ambitious vision for the river from Glasgow Green to the Erskine Bridge.

But, in the absence of co-ordinated action in the past by all the local authorities in the region, the Working Group is now faced with the difficult task of integrating the many existing (sometimes competing) development proposals for this part of the River Clyde corridor into a single comprehensive masterplan. Achieving an optimum development plan for the riverside will be extremely challenging. And there is still no formal mechanism for taking a strategic view of the developments to the east and west of the RCWG area.

8.6.2 The Land-Use Planning System

Earlier sections of this chapter have already highlighted the reforms that are proposed for the planning system. However, a large number of development professionals expressed frustration with aspects of the planning system that they believed were limiting the delivery of change in our cities. The compulsory purchase and planning gain regimes are dealt with separately below but a number of other concerns about the land-use planning system were raised.

8.6.3 Masterplanning for Change

One of the prime causes of concern was a perception that the key development and regeneration projects that are central to the future success of city-regions were not receiving sufficient priority. Some felt that there should be more widespread use of masterplans to ensure more holistic development, greater external buy-in, and a more integrated approach to delivery.

Masterplanning is already being used effectively in Scotland, but we agree it may be able to play a bigger role, particularly where action is required by multiple agents. Relevant projects might range from the redevelopment of a large brownfield site, greenfield sites or renewal of an existing neighbourhood/community. In such instances, comprehensive masterplans, with a strong action orientated approach, could bridge the gap between local plans and regional structure plans, and help focus and guide efforts to bring about change. This would link in with our earlier consideration of Urban Regeneration Companies and the discussion which follows below on a more action orientated role for the planning system.

8.6.4 Focusing the Planning System on Delivering Change

The planning system was also criticised for being slow and unresponsive. Many felt that plans were not generated, approved or updated quickly enough and that as a consequence they were often out of touch with reality. Some argue that council planning departments are under resourced, others that councils fail to make the best use of the resources they do have. There is certainly the perennial problem of 'routine' applications for planning permission driving out more strategic work. This is compounded by the bureaucratic nature of much of the formal consultative and decision-making processes.

The scale of the challenge is indicated by the available statistics on the performance of planning authorities:

TABLE 8.12: Type and number of planning applications processed by local authority - 1998/99 to 2000/01

Source: Data Compendium 2000/2001: Performance Information for Scottish Councils - Audit Scotland, February 2002.
N.B. The Scottish Executive target for local authority performance is for 80% of all applications and 90% of householder applications to be processed within two months.

Table 8.12 shows the number of 'householder' and 'non-householder' planning applications to the city authorities, and their performance in processing them, over the last 2-3 years. From this it can be seen that the city authorities' performance in processing all applications is just below the Scottish average, except for Edinburgh, which is well below the Scottish Executive's target. The performance of authorities over the period has improved slightly in some cases, but has declined slightly in others. Care must be taken when comparing the performance of councils since the time taken to process an application will vary according to the complexity of the application itself, the number of organisations and individuals to be consulted and whether it affects a listed building or conservation area. The proportion of applications that are more 'complex' in any one year will therefore affect the performance of authorities.

Nevertheless, the fact that the performance of city authorities in processing applications is, in some cases, worse than average has implications for development in our cities, and the lack of improvement in recent years gives cause for concern. This is particularly the case when one considers non-householder applications (such as those from housing developers and commercial organisations) and reflects the concern expressed by some that insufficient priority is given to processing planning applications for 'major' regeneration and development projects.

Table 8.13 shows the number of non-householder applications to each authority per thousand of population and gives some idea of the scale of activity for each authority. This shows that the volume of applications in the cities is less than the Scottish average and much less than the large, mainly rural, Highlands, although it is possible that applications and the resulting consultation process may be more complex in cities.

TABLE 8.13: Planning applications per head of population, by type and by local authority - 2000/2001

Source: Adapted from Data Compendium 2000/2001: Performance Information for Scottish Councils - Audit Scotland, February 2002.

The performance of Aberdeen, Dundee, Edinburgh and Glasgow is therefore poor compared to the Scottish average, and well below the Executive's target. There are recent signs of a sustained improvement in Edinburgh, although it has been suggested that in Glasgow there is little sign of improvement, indeed performance may have deteriorated.

Consequently, many review consultees felt that there was an urgent case for encouraging quicker consideration of developer planning applications in our cities. Some argued for the 'fast tracking' of planning applications for major projects and for the designation of 'priority' areas for development that might form the focus of special attention by planning departments.

The Planning Audit Unit, within the Scottish Executive Development Department, is working with authorities to try to improve performance in development control and Planning Advice Note 40 (Development Control) gives advice on best practice. However, a number of review consultees clearly believe that more needs to be done.

8.6.5 Compulsory Purchase Powers

There is widespread concern among local authorities and the development profession that the existing compulsory purchase order (CPO) system is not meeting current needs. Opinion is somewhat divided over whether existing local authority CPO powers are insufficient or whether current practitioners lack the necessary skills to employ them to best effect.

There is a commonly held belief among practitioners that current arrangements are at best complex, slow and unwieldy and that at worst they are adversarial and favour landowners. The most commonly expressed concerns related to the time taken to process applications for CPOs, the system for determining 'fair' compensation to landowners, and the definition of circumstances in which CPOs may be used.

Concern was expressed about the absence of commitment to a timetable for confirmation of planning CPOs by Scottish Ministers. Unopposed CPOs and those where the objections are withdrawn quickly can be processed very rapidly. However, where statutory objections are sustained, under the current legislation these require to be considered at either a public local inquiry or hearing. Such CPOs could take 2 years or more to be determined by Ministers. Where such a delay occurs this could cause major difficulties for regeneration projects and create uncertainty for both delivery vehicles and private sector partners over whether and when progress will be made.

Safeguarding the rights of the individual will remain a crucial requirement of the CPO process, but there is a feeling that more emphasis needs to be placed on the 'common good'. The current system appears to favour landowners who, once a regeneration scheme has been proposed, can delay the sale of their land in the hope that they will receive a higher return at a later date. Problems are exacerbated by a perceived lack of consistency from the Lands Tribunal for Scotland over how much landholders should receive in compensation. This may be allowing some of the 'betterment' value of regeneration schemes to leak out of the system - thereby reducing the returns that public and private sector developers might expect and the attractiveness of investing in regeneration projects.

It is possible that the proposals for Community Planning and a local authority 'Power of Well-being' contained in the current Local Government (Scotland) Bill may help to provide greater powers for authorities to act in the 'common good'. However, no consideration has yet been given to their potential impact on the CPO system.

Section 189 of the Town and Country Planning (Scotland) Act 1997 gives authorities the power to acquire land compulsorily for the purposes of development, redevelopment or improvement, or "in the interests of the proper planning" ⁸³ of an area. However, there is uncertainty among development professionals about the circumstances in which section 189 may apply and it has been suggested that Ministers should issue a policy statement clarifying their interpretation.

A final set of concerns surround the levels of professional competence in the use of CPO procedures and land compensation within local authorities. Levels of CPO use in Scotland have been low and declining in recent years and some have pointed to the absence of up to date, concise guidance notes for practitioners as one of the principal causes of this trend. There can be little doubt that the use of CPOs by local authorities has declined since a high point in the mid-1990's, despite the number of high-profile regeneration projects that have been implemented.

Research published in 2001 ⁸⁴ found that CPO use declined between 1994 and 1998, and that, if acquisitions by the Scottish Executive (almost exclusively for trunk road projects) were excluded, the limited use of compulsory purchase powers was even more striking. In addition, the research found that there was little evidence of orders being used for major urban regeneration projects. Figures on the use of CPOs by local authorities since 1998 suggest that it is continuing at a similar level. When looking at numbers of CPOs, however, we note that the research also indicates that the majority of acquisitions are made by agreement 'in the shadow' of compulsory purchase powers. In other words the vendor is aware that the acquiring authority could use compulsory purchase powers if necessary.

The review team believes that the decline in the use of CPO powers could hinder the future delivery of physical development in our cities. Research in 1996 into the use of CPOs under planning legislation across Great Britain suggested that the then single most important reason for the limited use of such orders was financial. ⁸⁵ While financial constraints are likely to remain a major factor influencing use of the powers, evidence is accumulating that legal and practical difficulties in using the powers are increasingly significant, and reform of the CPO system is now pressing. In particular, the team believes there are a number of short-term steps which could be taken without the need for legislation (such as the provision of updated guidance and training for staff involved in the CPO process) which would go some way towards preventing further decline in CPO use and the possible loss of expertise in this field.

England have already shown the way in this respect and published proposals for both legislative and procedural change. Following a consultation paper on changes to the system, ⁸⁶ the Office of the Deputy Prime Minister published proposals for the way forward for the CPO system in England in July 2002. ⁸⁷ This set out the Government's intention to bring about both procedural and legislative change to:

• Provide a clearer legislative basis for the use of CPOs and clarify local authority powers to utilise CPOs for the full range of planning and regeneration purposes;
• Make the system simpler (by making it easier to confirm orders and consider objections, to clarify compensation codes and entitlements, unify inquiry rules, and provide improved guidance);
• Make the system fairer (by improving the levels of compensation payable, increasing certainty about timetables for CPO procedures and encouraging easier access to the Lands Tribunal);
• Make the system quicker (by allowing for confirmation of orders in stages and increasing local authority powers to acquire land for mitigation purposes).

As a member of the Compulsory Purchase Policy Review Advisory Group, the Scottish Executive (and the then Scottish Office) has kept closely in touch with ODPM's work in England. In addition, the Executive commissioned research, published in 2001, to identify any particular Scottish dimensions to the compulsory purchase review. ⁸⁸ The Executive intends to consult on proposals for updating the laws and procedures in relation to compulsory purchase in due course.

8.6.6 Planning Agreements

Planning agreements often, but not always, relate to the provision by would-be developers of services and/or infrastructure that traditionally would have been provided by the public or voluntary sectors. Planning agreements may include the provision of 'affordable' housing by developers within owner-occupied developments, funding for improvements to transport infrastructure (such as access roads, bus stops and transport interchanges), and contributions towards social infrastructure (such as community centres, schools or other services). Such agreements are negotiated between planning authorities and developers to make development proposals acceptable in land use planning terms. The service or infrastructure provided by the developer is often referred to as "planning gain".

Planning authorities in Scotland have the power to enter into planning agreements under section 75 of the Town and Country Planning (Scotland) Act 1997. Current guidance from Scottish Ministers stresses that planning authorities should not use an applicant's need for planning permission to obtain a benefit which is unrelated in nature, scale or kind to the proposed development - i.e. that the subject of the agreement should be directly related to the development.

Use of planning agreements in Scotland is still relatively limited but is rising. Planning agreements accounted for less than 1% of all planning approvals over the 3 year period from September 1996 to September 1999, but rose by some 77% over the same period. ⁸⁹ The majority of agreements related to residential development and were used most frequently to secure infrastructure and transport improvements (including Green Transport Plans). There is a significant variation in the use of planning agreements between different authorities across Scotland, with Aberdeenshire and Aberdeen City accounting for nearly 30% of all of the agreements concluded from September 1996 to March 2000.

There is some evidence that planning agreements or obligations are used more widely in England. Recent research ⁹⁰ suggests that 17.6% of major developments and 26% of major housing schemes in England involved planning obligations. This may reflect more restrictive Scottish legislation about what agreements may contain and/or development pressures in the south-east of England.

Despite the growing importance of planning gain agreements, both private developers and public sector development professionals involved in the review identified concerns about the operation of the system which could frustrate development. Unsurprisingly, the private sector expressed concern that too much 'gain' was being 'squeezed' out of developments and that, as a result, the returns achievable were being reduced and investment opportunities stifled. On the other hand, some local authority members and officers were concerned that some developments do not realise the amount of 'gain' that might be possible. At the heart of this debate lies uncertainty about the level of contribution that might reasonably be expected from developers; one consequence is the length of time it generally takes to conclude an agreement.

Part of the problem is that there are pressures to use planning agreements for purposes other than those originally conceived. The statutory powers were designed to regulate the use of land and provide support for infrastructure and other improvements directly related to the development. The intention was not that they should be used to fund new transport infrastructure or affordable housing. Although the purpose of planning agreements is clearly defined in guidance from the Scottish Ministers, their actual use is "inconsistent and eccentric". ⁹¹ It is clear that, whatever their original aim, planning agreements are now being used to meet both the external costs of development and, more contentiously, to meet wider social/economic objectives. The financial pressures that have led to this outcome are unlikely to diminish, and there is therefore a strong case for considering whether planning agreements are the way to address these wider objectives and what amendments may be required to legislation and guidance in this area.

This trend towards use of planning agreements for funding necessary investment is unsatisfactory in several respects. As has been noted above, the negotiation of case by case deals can be time consuming. The process is also inherently inequitable in its treatment of developers. The big and the influential can use their influence and hire in negotiating expertise, the small and the run-of the mill often have little of either. Some developers may be able to evade their reasonable responsibilities, others may be asked to make too large a contribution.

But the public sector financial pressures that have led to this outcome are unlikely to diminish. Many, if not most, review consultees expected that planning agreements will become increasingly important if Government's ambitions for Scottish and UK cities are to be realised in years to come.

The draft development plan for London sets ambitious targets of 35% or 50% for each borough for the proportion of affordable housing that will be provided within private residential or mixed-use housing development schemes. The plan recognises that the share of affordable housing realisable on each site will vary according to individual circumstances and that therefore some sites will deliver less than 35% affordable housing, while others should deliver over 50%. Individual borough councils are therefore free to negotiate with developers about the level of affordable housing provided and may enter into agreements that provide for the provision of affordable housing 'off-site' or payments in lieu in some circumstances.

Similarly, in November 2000, the City of Edinburgh Council introduced an interim planning policy on the provision of affordable housing, in response to perceived high levels of unmet housing need in parts of the city. The policy seeks to ensure the provision of affordable units within housing proposals of over 25 dwellings of up to 25%. For 'major sites' of over 500 units there is a uniform target of 25%, while the proportion of affordable units varies from 0-25% in different areas of the city for smaller developments. The city council aims to implement this policy through their local plans, with specific policies set out at ward level tailored to local circumstances. Homes for Scotland have opposed the use of such clauses, regarding them as a 'development tax'. The Scottish Executive has recently consulted on revision of NPPG3 on Housing, ⁹² including affordable housing, and Ministers are expected to publish a final version early in 2003.

There is therefore a strong case for reviewing the legislative framework for planning agreements and developer contributions.

Designing a system for negotiating planning agreements and working out what a 'reasonable' contribution might be is, of course, fraught with difficulty. The economics of new housing, an office development or a major transport scheme will be widely different. They will also vary by scale and location. The public sector may well be at an information disadvantage in any negotiations. Approaches that might be appropriate for a fairly standard 'commodity' such as housing for sale, will not work for a one-off business park or new rail link. There is therefore no single panacea that will work in all circumstances.

But significant sums are at stake, particularly in the case of the major one-off projects. Private evidence to the review suggests that the infrastructure contribution negotiated with a Central Belt business park substantially underestimated the real value of the development. Looking ahead, the potential development gain to the private sector of the new Edinburgh trams and the Edinburgh and Glasgow airport rail links is likely to be sizeable.

We need more empirical evidence about which approaches work and in what circumstances. Can we increase the professionalism with which the public sector negotiates agreements? Can we introduce greater predictability and consistency in the level of 'public' investment expected of developers? Are there better ways of handling the major schemes?

8.6.7 Improving Negotiation Arrangements?

One obvious way to achieve greater clarity and consistency is to improve the way in which agreements are negotiated. At present the outcome of each case by case negotiation is subject to the different knowledge, experience and skills of the negotiators employed by both sides. This will undoubtedly vary considerably between cases and many believe that local authorities are usually disadvantaged by the relative expertise of their negotiators. Some consultees have therefore suggested that a solution may lie in improving the skills of public sector negotiators or in the 'professionalisation' of the system.

One council who have already pursued this approach is Aberdeenshire, who have appointed a planning gain co-ordinator whose role it is to undertake all negotiations with developers on behalf of the council. Better training for public sector negotiators will also go some way to achieving greater consistency in negotiations. At present, planning graduates receive no training or experience in the negotiation of planning agreements.

In other areas of Scotland and the UK some councils have begun to explore the possible use of planning gain 'brokers', independent of both sides, who seek to maximise development opportunities for both public and private sectors. They would appear to offer particular potential in relation to projects that might otherwise fail to be implemented due to uncertainties among both developers and councils about the level of 'uplift' achievable.

8.6.8 Development Tariffs?

To tackle uncertainty in the levels of 'gain' expected, some have advocated the introduction of a development tariff system that imposes 'standard' rates of 'gain' on developments. Some authorities in England (for example York and Cambridge) and parts of the Republic of Ireland have already experimented with the use of tariffs on a small-scale. In addition, a recent English consultation paper ⁹³ proposed reform of the planning obligation system in order that it might act as a mechanism to ensure that development provides social, economic and environmental benefits to the community as a whole - thereby delivering sustainable development. A central element of the proposed reforms comprised the introduction of a standard tariff system, set locally through the local plan process. The UK Government decided against a national move towards tariffs in the near term. ⁹⁴

The review team found little enthusiasm for the adoption of a tariff approach in Scotland - with many believing a tariff system to be unworkable and too close to a 'development tax' to be considered acceptable. Nevertheless, the review team understands that some councils are considering introducing local development tariffs (e.g. West Lothian). It will be interesting to observe how such moves are perceived and work locally, before considering whether Scotland should pursue the tariff approach adopted in England and elsewhere.

8.6.9 The Way Forward

Uncertainty about the level of 'gain' that might be realised from development in our cities and the practice of negotiating contributions are causing delays and inconsistency in the delivery of change. This section has highlighted some of the potential solutions put forward to ensure that the potential contribution of planning agreements to realise visions for our cities are neither over nor under-exploited. It is clear that improvement to the system is needed but it is less clear that one solution will provide the answer in all circumstances. It is vital that local authorities, developers and the Scottish Executive work together to provide encouragement and support for new approaches to this issue. The Scottish Executive, the Royal Institute of Chartered Surveyors and Royal Town Planning Institute will be holding a joint conference on planning agreements and infrastructure provision to debate some of these issues in early 2003.

8.6.10 Financial Incentives and Restrictions

Despite the widespread use of purpose specific delivery vehicles, and recent encouragement for the use of joint ventures, the review highlighted concerns amongst the development profession about the financial regime supporting regeneration efforts.

8.6.11 Flexible deployment of funding

Despite recent encouragement for partnership working and the pooling of budgets to finance major projects, many consultees reported continuing concern and uncertainty amongst local authorities about the accountability of arms'-length delivery vehicles. Best value proposals in the current Local Government Bill will clarify the regulatory position and enable better informed decisions about the role of special purpose vehicles. However, there is still a need to educate local authority councillors about the benefits of innovative approaches and thus make them more comfortable with their use. At present the review team believe that some opportunities for the use of innovative delivery vehicles to facilitate regeneration may be being missed due to a lack of willingness to deploy funding and staff in flexible ways.

8.6.12 Exploitation of tax incentives

Review consultees also believe greater opportunities exist for more widespread exploitation of the tax and other incentives available to support regeneration activities. The UK Treasury, partly in response to the report of the Urban Task Force in England, has introduced a number of tax and other incentives in recent years to encourage the regeneration of our towns and cities. Table 8.14 summarises those currently available or proposed.

TABLE 8.14: Tax Incentives Available to Support Urban Regeneration

However, there is some concern that these incentives are not being exploited in Scotland as extensively as they might be. In part this may be because the type and location of regeneration efforts designated as eligible for relief do not ideally match current initiatives in Scotland. In addition, knowledge of the incentives available may not have penetrated Scotland as widely as would be desirable.

There is therefore a need for the UK and Scottish governments to encourage greater exploitation of the tax incentives available by promoting their availability more widely throughout target areas and by ensuring that their design matches Scottish needs accurately. One way of raising awareness would be through publicising case study examples of developments that have taken advantage of the incentives to date.

8.6.13 Investment in Physical Infrastructure

A further barrier to the effectiveness of regeneration and development activities comprises the relatively low levels of public sector investment in infrastructure. In part this may reflect a general shortage of capital resources available for investment (as highlighted earlier in this chapter) but may also reflect a general reluctance on the part of local authorities and public agencies to invest in projects prior to confirmation of private sector investment and/or competing priorities for resources.

In comparison with some of their European counterparts, Scottish public sector agencies appear reluctant to invest 'speculatively' in public infrastructure and services (e.g. roads and public transport, water and communications technology) prior to the first turf being broken on new regeneration initiatives. Chapter 3 has already highlighted the implications of this on the regeneration of brownfield land in our cities, but the reluctance of local authorities and others in Scotland to put in place public infrastructure prior to development - with the aim of encouraging private sector investment - may be stifling some development projects.

This contrasts with attitudes in some of Scotland's competitors. In countries such as the Netherlands and Germany, public authorities are much more willing to purchase land upfront, put in place a masterplan, invest in public infrastructure and only then dispose of the land to developers, using the higher prices obtained to reimburse some or all of their upfront costs (the former "New Town Model"). There was general agreement among review consultees that this approach (although carrying greater risks) leads to more integrated and equitable outcomes in the longer term.

Public agencies need, of course, to balance investment strategies across a range of priorities. However, concern was expressed by review consultees that the current investment strategies of some agencies (for example, Scottish Enterprise) are too heavily weighted against physical infrastructure projects. Physical investment is, of course, not an end in itself - it is only one of a number of investment streams that need to be integrated to help ensure strong, sustainable development. But there is a need for public sector agencies to consider more explicitly the spatial implications of their support strategies and the type of investment that will best deliver their objectives. The review team believe that more needs to be done to encourage investment in physical infrastructure as a way of facilitating growth. In particular the proposed national planning framework will have a role to play in signalling the importance of investment in public infrastructure and in identifying the key projects that will be central to the realisation of the Executive's ambitions for Scotland's future.

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