Walker gets blanket powers

THE GOVERNMENT will move to regain the initiative in Britain's inner cities this week by announcing a wide remit and sweeping powers for an interventionist agency to regenerate Britain's derelict urban areas.

The Urban Regeneration Agency, headed by Peter Walker, the former Conservative Cabinet minister, will be able to make compulsory purchase orders and override local planning constraints. It will also take over several large grants and schemes for rundown areas.

Ministers will not change the pounds 750m City Challenge, the Department of the Environment scheme which recently rejected an application for pounds 37.5m from Bristol's riot-torn Hartcliffe estate. But they will launch the agency as part of a new economic and social policy for inner cities.

With developers reluctant to build offices in the South, a house-building programme is likely to be at the heart of Mr Walker's plans. The agency, which will not be fully operational until the end of 1993, will aim to reclaim derelict land and act as a developer in partnership with business and local councils.

Mr Walker will also focus on training. Ministers are determined to learn the lessons of London's Docklands, where local people felt excluded from economic opportunities.

Mr Walker's budget will include City Grants and Derelict Land Grants, worth more than pounds 100m, as well as English Estates, a property arm of the Department of Trade and Industry which provides factory space for inward investors. English Estates is selling off a stream of properties, bringing in many millions which could be invested.

However the agency's total budget will be determined in public-spending negotiations and will not be announced this week.

Much of the agency's work will be carried out by regional offices of the DoE, rather than London- based officials.

Mr Walker's immediate task is to assess how the property market crash has affected prospects of redevelopment. Office developments are likely to be concentrated in the North where property prices have been more resilient.

There are also likely to be new partnerships with retailers, some of whom are anxious to switch their attention from out-of-town developments to inner-city sites.

Michael Heseltine, now President of the Board of Trade, announced the creation of the agency in the run-up to the election, when he was Secretary of State for the Environment.

Publication of the agency's remit will end months of wrangling in Whitehall over the extent of its authority, with some ministers said to have resisted the granting of compulsory purchase powers.