“Joyz-n-the-Hood”

In its report The Anatomy of Mission Critical Neighbourhoods (May 2025), the Independent Commission on Neighbourhoods outlined the key challenges facing some of the most disadvantaged places in England and the near one million people living in them.

In these ‘mission critical neighbourhoods’:

• Half of adults are economically inactive.
• 40% of working-age people have no qualifications – more than double the national average.
• Gross Value Added (GVA) per working age person is 40% lower than for all neighbourhoods.
• Means tested welfare spending is more than double the national average.

In response, the Commission called for a targeted programme of investment and support for these places. And so say all of me.

Indeed, many of those who have had the misfortune of being in the same room as me at some point over the past year, will likely have heard me reminiscing wistfully about area-based regeneration. Under the last Labour Government, there was an awful lot of it: Deprived Area Fund, Housing Market Renewal Pathfinders, Local Enterprise Growth Initiative, Neighbourhood Management Pathfinders, Neighbourhood Renewal Fund, New Deal for Communities, Sure Start, Working Neighbourhoods Fund and probably others I’ve long since forgotten about. Having been involved in the evaluation of examples of all of them, I am well aware that not every one was perfect – far from it in some cases – but the decision to pull back from all forms of area-based regeneration in 2010 was a wanton act of socio-economic vandalism.

Since then, the third sector has done what the third sector does (tried desperately to fill gaps in service provision), with many local authorities also doing their best in the context of savage budget cuts. The Regional Growth Fund and Local Growth Fund both seemed to have somewhat patchy records and neither had any interest in neighbourhoods. More recently, some Police and Crime Commissioners have stepped in, recognising that prevention is far better than cure and investing in projects at local level that seek to address the root causes of violent crime. 

In a belated attempt to look like it was remotely interested in left behind places, Conservative Governments introduced the Levelling Up Fund and UK Shared Prosperity Fund; the former barely gave a nod towards socio-economic issues whilst resources for the latter were paltry in comparison with the European Structural and Investment Funds (ERDF and ESF) it notionally sought to replace. And then a weird thing happened: the Long Term Plan for Towns was announced. Out of the blue, 75 towns were each allocated £20 million they hadn’t asked for, to spend on projects they hadn’t thought of. But before they could do anything very much, along came a General Election, prompting fears that these unexpected gifts might be snatched away.

By remarkable coincidence, the same 75 towns now feature in the Plan for Neighbourhoods. (go to the website and you’ll see a rather crude copy and paste from some old New Deal for Communities documents, attempting to reframe the programme). However, what hasn’t changed is the skewing of resources that demand three quarters of these budgets be spent on capital investments. And, as we all know, sustained service provision requires a long-term commitment to adequate revenue funding.

The concern was that this might be all there was to the current Labour Government’s approach to tackling the multiplicity of socio-economic challenges at neighbourhood level, especially given warnings about the dire state of the public finances. But no, much else has been brewing and we are about to get drunk on the prospect of significant and sustained investment in our most deprived communities.

The Chancellor’s Spending Review (June 2025) included some genuinely significant announcements:

• A commitment to improving 350 deprived communities, by investing in community cohesion, regeneration and improvements to the public realm.
• 25 ‘trailblazer neighbourhoods’ (20 in England, one in Northern Ireland, two in Scotland and two in Wales) will each receive up to £20 million over the next decade for investment in community-led projects to “support improvements people can see on their doorstep”.
• A £240 million capital investment in a Growth Mission Fund (2026‑27 to 2029‑30) in projects that facilitate job creation and the economic regeneration of local communities.

Of course, the angel will be in the detail, but perhaps I might make one small request of those designing these initiatives? Could you perhaps have a read of some of the evaluations of similar previous programmes? You might even have a chat with some old economic development professionals who may be able to offer some useful insights into ‘what works’ (and what doesn’t work). Indeed, some are so passionate about this stuff that they would happily do so voluntarily.

Keith Burge is Principal at Smarter Economics.

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