Sir Michael Lyons and Lesley Chalmers are in charge of one of the best-kept secrets in regeneration 鈥� a public鈥損rivate venture set up to transform the grimmest areas in England. They are also a great comedy double act.
On the face of it, they're so different
She likes Irish whiskey; he drinks Burgundy. She has romantic dalliances with the likes of star architect Ian Simpson; he meets up with Gordon Brown for chinwags on council tax reform. She likes saucy banter like: 鈥淥ur plan
is to go in early and come out late 鈥� there鈥檚 probably a joke in there somewhere鈥�. He laughs, but replies: 鈥淟et鈥檚 not go there.鈥� To put it another way: she鈥檚 techno; he鈥檚 concerto.
The odd couple are Lesley Chalmers and Sir Michael Lyons, chief executive and chairman respectively of the English Cities Fund. The ECF was set up in 2002 by regeneration quango English Partnerships, contractor Amec and investor Legal & General. This unique public鈥損rivate venture aims to show the private sector that it can make money from regenerating even the most rundown communities. This year is crunch time: the ECF wants all six of its signed-off schemes across the country to be on site within the next 12 months.
At times, Chalmers and Lyons are a great double act 鈥� the Morecambe and Wise of the regeneration world. At others, they鈥檙e reminiscent of a long-married couple: she pours a glass of water for him when they arrive at Amec鈥檚 City offices, he touches her arm to apologise when he interrupts her. In fact, a leading developer is known to joke of them that 鈥渟he leads him around by the hand so he knows where he鈥檚 going鈥�.
Of the two, Lyons has the bigger reputation. He is a former Birmingham council chief executive, and has produced reports for the Treasury on civil service relocation and the sale of government assets (see 鈥淨&A鈥�).
He is also a non-executive director at support services group Mouchel Parkman. But Chalmers is the regeneration veteran, having led the renovation of the notorious Hulme district of Manchester during the early 1990s. She spent the five years between that job and her appointment at the ECF as a freelance consultant, advising the likes of the Prince鈥檚 Trust. Explaining her appointment, she says: 鈥淛ohn Early of Amec, who had been on the board of Hulme, called me one day, wanting to talk about the ECF. I hadn鈥檛 even heard of it.鈥�
If we can show that there is money to be made, others will follow. At the moment, people think of regeneration as working in dirty places ... But we鈥檙e not looking for world domination
Lyons was aware of the ECF from the start, having read the proposal for such a company in Richard Rogers鈥� urban taskforce report. EP picked up the idea, but the investment of a quango meant that the ECF was subject to European Union state aid regulations. As a result, ECF can invest only 拢50m at a time on a project, and schemes have to be located in assisted areas. As Lyons points out: 鈥淚t鈥檚 a tight focus and we have been fairly cautious about our public profile.鈥�
Chalmers and Lyons deliberately maintained that low profile while they negotiated deals with local authorities for the land they needed and the schemes they proposed. As a result, many people still haven鈥檛 heard of them.
The projects
Chalmers stresses that they are 鈥渢aking on areas that have got a really poor image鈥�. That means grim estates in Liverpool, Manchester, Wakefield, Gateshead, Plymouth and Canning Town in east London. The plan is to transform them into modern, mixed-use environments.
In Liverpool, for example, ECF will start developing 50 apartments in July, although the scheme will also capitalise on a location close to the city鈥檚 business district with a big office development.
ECF hopes that its projects can differentiate themselves from other large-scale schemes. Lyons was an east London lad, and recalls how he used to help his mum carry home potatoes from the market in Canning Town. (As one long-standing friend puts it, 鈥渉e likes to let everyone know about his working-class roots鈥�.) It clearly rankles with him to be reminded that one of the criticisms of the regeneration of London鈥檚 Docklands was that it did not boost the surrounding areas where he used to shop, or Poplar and the Isle of Dogs.
鈥淵es, when you get to the A13, regeneration comes to a standstill,鈥� he says. 鈥淪omething always has to have a boundary, but the rational answer is that you shouldn鈥檛 draw a line. We鈥檝e learned that a hinterland is difficult to map, but you need to.鈥�
We鈥檝e got enough schemes to chew on for now, but we are already thinking of turning this into something bigger
Chalmers chips in to back up her brother-in-arms: 鈥淲e鈥檝e looked over the past couple of years for our six local authority partners to share our convictions. For instance, Plymouth 鈥� our 鈥渟easide scheme鈥� 鈥� has an area plan that goes beyond our scheme. Without a full regeneration strategy, we might as well pour money down the drain.鈥�
Each area earmarked by the ECF will cost more to regenerate than allowed for in the 拢50m cap, but projects will be phased to allow for additional investment over the years. This should not be too much of a restriction: at present, its total budget is just 拢100m, half of which is provided by the three equity investors and half by bank debt.
Drumming up competition
ECF鈥檚 running costs are minimal; the body has no dedicated offices and a staff of one: Lyons is on the books, Chalmers is employed by Amec. However, it has an eye on expansion. The 拢100m can be raised to 拢250m, but Lyons seems to have grander visions yet: 鈥淲e鈥檝e got enough schemes to chew on for now, but we鈥檙e already thinking of turning this into something bigger.鈥�
It is not only investors that ECF is looking for, but also competitors. If the fund is to be considered successful, it needs to create a whole new market for private sector investment in the regeneration of the most rundown areas, which would also mean that institutional investors take on more risk. Chalmers says she looks forward to operating in a more crowded field. 鈥淚f we can show that there is money to be made, then others will follow, because at the moment so many people think of regeneration as just working in dirty places. [But] we鈥檙e not looking for world domination.鈥�
As the interview ends, Chalmers makes her comment on entering early and leaving late. She鈥檚 making a perfectly sensible point that the fund is investing in projects for the long haul, but this doesn鈥檛 prevent the pair sniggering like schoolchildren. Then Chalmers suddenly declares: 鈥淥ur plan is both cunning and鈥� 鈥� pausing for full impact 鈥� 鈥渕ultiple.鈥� Forget Eric and Ernie 鈥� this is like being in a Carry On film.
Q & A
Lesley Chalmers
Do you have any concerns about the government鈥檚 sustainable communities plans?
Volume is my big worry. We must look at quality 鈥� you can鈥檛 just count numbers, otherwise someone will have to come back in 30 or 40 years and fiddle around with it again.
What about the Northern Way?
I鈥檓 a Manchester resident, so, as I see it, if we keep on just putting investment into the South-east we鈥檒l tip into the sea. It would be a bit like the Titanic.
Does it help that the ECF has public funding?
Sometimes it can be unhelpful. A lot of hits on our website ask what grants we give.
Where were you born?
My family鈥檚 all Scottish. I was born in an army hospital 鈥� but don鈥檛 write that, I get enough of that dominatrix stuff ...
Quite ... What鈥檚 the fondest memory of your career?
The end-of-first-year party at Hulme. Thousands of people came, and there was not one arrest. There were all these interesting smells, almost tobacco-like, and I was standing next to the police [chuckles]...
Sir Michael Lyons
Do you think you upset a lot of civil servants in your report last year, when you said 20,000 should be moved out of the South-east?
I like to think of it as putting smiles on the faces of the 70% of the civil service who work outside of London and people forget about. It would also be of benefit to London, as it would reduce some of the overheating of the London economy.
What about the 拢30bn you said could be made by selling off civil service assets, including property and land?
The chancellor asked me to find out if this 拢30bn figure was achievable. What my report showed was that this was not unreasonable over the next five to six years. It will be a bit of a stretch, but there need to be clear targets. Already some of the big changes necessary are in place, such as the establishment of a National Assets Register.
Any hints on the content of your next report for the chancellor on council tax?
Part of it is about whether councils should start looking at a return to the business rate or the possibility of raising local income tax.
What鈥檚 Gordon Brown like?
I鈥檝e only ever had good meetings with him.
