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(Note: This Monograph has been reproduced
by kind permission of the Commission for the New Towns now known as English
Partnerships. It is published for general interest and research purposes
only and may not be reproduced for other purposes except with the permission
of English Partnerships who now hold the copyright of LDDC publications)
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Foreword
The closure of the upper docks by the Port of London
Authority with the resultant decline of traditional port related activities
in East London, provided a particular challenge to the London Docklands
Development Corporation. On embarking on its task of regenerating London
Docklands, the Corporation found an immense economic void which had to
be filled with new economic activities.
Key therefore to the success of regeneration was the
need to provide a new and sound economic structure for the area, to attract
new business sectors and thereby create new employment opportunities.
This monograph, one in a series published by the Corporation
in its final year of operation, describes the Corporation's approach to
what, with hindsight, has proved to be a highly complex process. It has
involved many partners engaged in training and employment provision. Nevertheless,
it has produced highly successful outcomes as measured in terms of new
jobs, new skills and new investment. Perhaps, most important of all, it
has provided Docklands with a solid future. It has enabled the area to,
once again, play a full and dynamic part in contributing to London's economy.
LDDC
February 1998
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The LDDC'S Remit - Introduction and Background
When in July 1981 the London Docklands Development Corporation
(LDDC) commenced its work of regenerating London Docklands, it found just
1,000 mostly small companies left behind following the dock closures of
the 1960s and 1970s. These were the remnants of the industrial sectors
which had once dominated economic activities in the area and which had
contributed so much to the wealth of the region. In all, these surviving
companies employed just over 27,000 workers.
To some observers the Corporation at its inception was
not particularly well-equipped to handle employment matters indeed, as
late as February 1988, A.J. Butler, Director of the Inner Cities Directorate
at the Department of the Environment (DoE) (the Corporation's sponsoring
department), in giving evidence to the House of Commons Employment Committee
stated that:
"We do not see Urban Development
Corporations as being primarily and immediately concerned with employment,
they are about regeneration and indeed, about physical regeneration of
their areas and that is where the primary thrust of their activity is
concerned."
Accordingly the tools provided to the Corporation by
Government through the DoE were indeed concerned with physical matters
- powers for planning and development, for land assembly and infrastructure
provision. The tools for creating employment, as such, rested not with
the DoE but were divided amongst the Departments of Trade and Industry,
Employment, Education, the Home Office and the Manpower Services Commission
(MSC). Apart from such difficult organisational issues other realities
had also to be addressed by the Corporation.
It was acknowledged at the outset that before economic
revival could take place, before the area could be successfully promoted,
the general public perception of the area as London's backyard had to
be overturned. To do this it was recognised that significant public investment
had to be made: in extensive land reclamation; in the expansion of basic
gas, water, electricity and drainage services; in new technology such
as fibre optic cables; in the provision of new roads and public transport
facilities.
Furthermore, all this expenditure was required "up
front" in order to successfully lever in extensive private sector
investment and involvement to be followed by new businesses and jobs.
This proved to be a demanding initial set of tasks, for
the area had long been neglected, was regarded as inaccessible and had
in the past been by-passed by the London property markets. To many, London
Docklands presented a problem, to the extent that consultants appointed
by Government in the early 1970s had recommended, as one of a number of
options, that the area be grassed over as a vast new public open space
for Londoners. To the Corporation, however, it presented a challenging
opportunity to arrest decline, and using innovative methods revive an
historic core of London.
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The Wider Economic Context
The economic situation that the LDDC inherited in July
1981 was instrumental in determining the Corporation's initial approach
to its employment and economic strategies. In common with the rest of
London, Docklands had seen a dramatic decline of jobs over the previous
20 years, particularly in the manufacturing sector but with a loss of
jobs in every category of employment. Historically against a background
of a declining population, Greater London lost over 400,000 jobs in manufacturing
industry between 1961 and 1971. A further 100,000 jobs were lost in the
same period in the group broadly described as distributive trades, transport
communications and utilities. Some 8,500 jobs were lost in Docklands alone
in the five years before the Corporation came into being, that is between
1976-81. By illustration, this was against a backcloth of events in Tower
Hamlets where the borough saw its population decline from 202,000 in 1966
to 132,000 in 1981 and jobs from 145,000 to 75,000 in the same period.
 Related
in part to this economic decline was the large stock of vacant industrial
floorspace in the area with unit sizes largely unrelated to market demand
and much of it obsolete in terms of modern requirements. Estimates at
that time indicated that there was a total of 7.6 million sq.ft (710,280
sq.m) of vacant space in the three Docklands boroughs, of which 3.2 million
sq.ft (299,065 sq.m) was located in Tower Hamlets, 2.8 million sq.ft (261,682
sq.m) in Newham and 1.6 million sq.ft (149,532 sq.m) in Southwark.
Of significance was the fact that 43% of the space in
Newham was constructed in the 1950s and 1960s while 44% of Southwark's
vacant floorspace dated from the 1940s. A similar situation existed in
Tower Hamlets. These were hardly assets which could be utilised by the
Corporation in seeking to attract new businesses to the area. The task
was not made easier by Government studies of the time. These confirmed
that inadequate premises were a material factor in many employers moving
out of the inner City to other locations resulting in loss of jobs and
contributing to the air of dereliction as vacated premises were being
largely ignored by the market. This was precisely the situation in London
Docklands.
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The Emergence of an Employment Strategy
Against this difficult background the Corporation nevertheless
recognised that there were some positive elements which could be turned
to advantage in formulating initial strategies to attract investment and
new jobs to the area. These included extensive land holdings which had
been transferred to the Corporation and which could be turned into serviced
sites for new development. It included the 1,000 companies which existed
in the area and which could, with active business support from the Corporation,
be helped to diversify, expand and consolidate thereby creating enhanced
job opportunities for people with local skills. There were also the 482
acres of the Isle of Dogs Enterprise Zone (EZ) which came into being on
the 26th April 1982. This had a 10 year life and was to play a key role
in the Corporation's plans in creating a new economic structure, not just
for the Isle of Dogs, but the wider area.
 The
creation of the Enterprise Zone provided the Corporation with the opportunity
to create an initial two prong strategy. First, the Enterprise Zone tax
benefits, it was decided, would be used to attract largely new businesses
to the area on to either serviced development sites prepared by the Corporation
or modern premises built by the private sector for buying or leasing by
new businesses. Second, it was decided that this inward investment activity
would be complemented by assisting existing firms, located outside the
EZ, to benefit from business support and development programmes. These
incorporated financial schemes of assistance provided under the 1978 Inner
Urban Areas Act, which was passed by Government to enable local authorities
to assist businesses, especially in deprived inner city areas.
In this way the Corporation sought to retain existing
firms in Docklands and help them to grow and prosper, whilst seeking to
bring new businesses to the area. At the same time, the Corporation was
careful not to attract businesses to move into the area simply on the
basis of financial incentives or grants alone. The view was taken that
what Docklands required for its long-term employment future were viable
companies of substance and not companies simply attracted by the prospect
of financial carrots or indeed other handouts as offered by other regions
undergoing economic structural change. As part of this strategy, over
2 million sq.ft (186,915 sq m) of empty, obsolete industrial space was
demolished by the Corporation in the future Enterprise Zone to provide
land for development and subsequent provision of business premises. Such
premises were to be let at market rates in order to attract not only new
businesses but also to create a new modern business environment for the
area.
The Wimpey built Enterprise Business Park, Indescon Court
and The Lanterns were schemes all located in the Isle of Dogs Enterprise
Zone which represented the first wave of new business space in London
Docklands. These by 1982-83 provided modern landscaped accommodation with
car parking and loading facilities in a range of unit sizes, and at rental
levels competitive with such accommodation which existed elsewhere. Serviced
sites were also made available for those companies who preferred to buy
their own plots of land and build their own premises, and publisher Northern
and Shell was an early example of this.
Outside the EZ existing Docklands companies were provided
with business development support programmes and financial assistance
under the Inner Urban Areas Act, the use of which the LDDC Board had approved
as early as November 1981.
In deciding to use the Act, the Board sought to implement
policies which inter-alia would help:
- To introduce growth, service and high technology industries to the
area
- To establish a new economic base for existing industry and commerce
-
To build on occupational and development success
wherever it already existed - "the growth area" - approach
- To secure a high quality of development and environment
-
To use the loans and grants available under the
Act as "levers" to extend private sector participation in
both the industrial and commercial sectors.
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It was also decided to focus use of the Act in certain
key areas where existing employment activities were concentrated. Such
areas included Silvertown, the London Industrial Park in Beckton and parts
of Wapping, Bermondsey and Rotherhithe.
Furthermore, it was decided that with the exception of
firms displaced by the Corporation's programmes, assistance under the
Act would not be made available to companies locating in the Enterprise
Zone - "in order to ensure a spread of financial
assistance throughout the Docklands area". Also "in
order to sustain existing firms' commitment to Docklands and to maintain
existing established industrial/commercial locations' preference
was given in providing help under the Act to local firms' proposals and
plans for "in-situ" improvements where they accorded with the
Corporation's planning and development proposals.
 Apart
from these locational criteria the Corporation also adopted certain sectorial
criteria. Thus it was decided that in allocating financial help preference
would be given to firms engaged in sectors of technological innovation
in order to "encourage growth, service and
high technology firms to locate in Docklands, assist in diversifying the
existing employment base and expand related opportunities".
It was also decided to give preference to existing local firms engaged
in traditional but, nevertheless, expanding manufacturing sectors of industry
which wanted to invest in the modernisation and expansion of their premises
in order to "sustain local industry and
provide opportunities for its growth". With an Enterprise
Zone in its midst, the Corporation was concerned to maintain the vitality
of areas external to it. It therefore decided that special consideration
should be given to start up new venture firms, especially those engaged
in research and development of new technology which wished to use and
adapt existing vacant premises located throughout Docklands but outside
the EZ. The Act was therefore used to assist such firms with front-end
finance to aid their beneficial use of the many vacant premises in Docklands
and thereby help to minimise any possible detrimental effect on commercial
premises located outside the EZ. (in the event, the Corporation's concerns
proved unfounded for many premises were subsequently acquired outside
the EZ for conversion to residential use, especially obsolete riverside
warehouses and other buildings on waterfront locations).
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The Role of the Docklands Business and Research Centre
and the Docklands Business Club
In addition to providing development land, new premises
and financial assistance, the Corporation from the start was determined
to develop a close and positive working relationship with companies in
the area. This included both those who had survived the dock closures
as well as newcomers. Developing economic and employment strategies was
seen as a dynamic process by the Corporation, one involving the emerging
business community. Apart from being consistent with the Corporation's
remit of working in partnership with the private sector, the Corporation
saw many advantages in such an approach.
As a result, in April 1983 the Corporation Board agreed
two major business development and support initiatives - the creation
of the Docklands Business Research and Information Centre (DOBRIC) and
the Docklands Business Club (DBC). After nearly two years work the Corporation
was moving on from its initial prime tasks of site acquisitions, land
preparation, infrastructure and service provision. Companies were responding
to these physical programmes of regeneration and making increasing demands
on the Corporation for basic business information, as well as assistance
with planning and financial matters in preparing their own proposals for
investing in the area. Docklands was after all an untested location, unlike
the City and the West End, both well populated with professional advisers,
agents, business and research institutions. In contrast, Docklands possessed
no such facilities for the would be investor or relocatee. The creation
of DOBRIC, located in Dockmasters House at the main entrance to the Enterprise
Zone, was the starting point of providing a comprehensive centralised
and fully integrated support service by the Corporation to the business
community. Staffed by specially recruited business managers from the private
sector, it provided a range of specialist help including advice, information
and counselling services. As such, DOBRIC, formally launched by Sir George
Young, then Under Secretary of State for the Environment, in October 1983,
pre-dated by many years the Government's own "One Stop Shop"
service that was introduced for businesses in the early 1990s.
 A
similar first was achieved by the Corporation in creating the Docklands
Business Club which was launched in May 1984 by David Trippier, the then
Small Firms Minister, at the Department of Trade and Industry. Here the
Corporation took the view that its relationship with businesses should
be more than a passive one way flow of providing services whether of financial
assistance or planning permissions. Instead, it considered that within
the overall regeneration framework, it should in its most successful form
be an inter-active relationship. This meant that both parties, that is
Corporation and business, should stimulate each other through dialogue
into a variety of proposals, plans and initiatives aimed at the common
goal of successful economic redevelopment. It was an approach new to the
UK based on real partnership, but one which had been tried and successfully
tested in the USA. There, City Halls and local businesses had long pioneered
such partnerships in successfully and jointly redeveloping their redundant
waterfronts as in Baltimore, San Francisco and Boston. In practical terms,
the creation of the DBC put Docklands businesses on the "inside track"
of the Corporation's activities. At monthly lunchtime meetings, the Corporation's
Directors and senior executives would outline plans and proposals for
the area, especially those affecting local businesses. These occasions
provided an opportunity for businesses, new and old, to meet informally
amongst themselves and the Corporation staff. The contact and the dialogue
so established proved invaluable to both parties as economic regeneration
gathered pace.
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Employment and Jobs - Initial Outcomes
Towards the end of 1984 good progress was being made
by the Corporation towards the economic revival of the area. Doubts about
the Corporation's continued existence had been removed the previous year
with the re-election of Margaret Thatcher's Conservative Government in
1983. Perceptions of the area as a new business location were also beginning
to change for the better. These were helped undoubtedly by the emergence
of an embryonic business community in the Isle of Dogs Enterprise Zone,
the start of work on key public transport schemes such as the Docklands
Light Railway (DLR) and the massive reclamation programmes underway throughout
the area. There was also, albeit grudgingly, the beginnings of local recognition
that with the final dock closure, that of the Royal Docks in November
1981, future jobs would certainly have to come from new economic sectors
unrelated to the past.
 It
meant that a whole range of new skills would need to be acquired by the
local labour force in order to compete in this new job market. It was
to lead the Corporation into the highly complex field of adult skills
training and education generally, of which more later.
By 1984, certain trends were emerging which provided
an outline indication of an emerging employment profile for the Urban
Development Area (UDA). These showed:
- The emergence and concentration of small firms in units of one to
10 employees
- A move away from the manufacturing sectors and the emergence of
service sector firms
- A high proportion of new firms - up to 40% of all firms with less
than five years' residence in Docklands provided nearly a third of
total employment
Such trends contrasted with the picture painted by the
1978 Employment Census. This showed that the UDA contained some 1,200
firms (reduced to 1,000 by 1981) and employing 37,000 people (reduced
to 27,200 in 1981). Some 21 % of firms were in the manufacturing sector
employing 42% of all employees, Of these firms 650 were located in the
UDA part of Tower Hamlets and employed some 14,000 people at the time
of the Census. Jobs, the Census revealed, were still influenced by the
area's historical base - thus 26% of all jobs were provided by the transport
and communications sector, 25% by the food, drink and tobacco sector,
and 9% by the distribution sector.
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By comparison, the Corporation's Annual Report and Accounts
for 1983-84 estimated that since July 1981 at least 3,860 permanent new
jobs had been created with another 1,500 jobs engaged in construction
work. These jobs were at the forefront of creating a new and diversified
economic base for the area, deliberately moving away from the past to
create a solid new employment future. Of these new jobs, about 1,000 were
established in the EZ, including 110 companies in Cannon Workshops. Encouragingly,
these newcomers represented new start-up businesses ranging from textile
consultants to light engineers. Outside the EZ, the opening of the two
Asda stores on the Isle of Dogs and Beckton created 700 jobs in the retail
sector.
By the end of March 1984, the Corporation had invested
over £21 million in infrastructure, including new roads and services on
the isle of Dogs enabling the EZ to come into its own. In the same period,
private investment in the EZ totalled £140 million and new business space
totalled 1.3 million sq.ft (121,495 sq.m). Twelve months later the Corporation's
investment had increased in the EZ to £35 million. Private investment
had risen to £180 million and total new jobs had jumped to 5,700 with
new business space totalling just under 2 million sq.ft. (186,915.sq.m).
Against this gathering momentum there were, nevertheless, some disappointments.
The rationalisation of traditional industries had continued. Thus the
Corporation was unable to persuade Crosse & Blackwell not to phase
out operations in Newham with the loss of 490 jobs. Some 1,400 redundancies
were notified in the period between July 1981 and June 1983 and consequently
local unemployment in the early years of the Corporation's life remained
high. In 1984, male unemployment ran at 30% and that of women at 15%,
compared with average unemployment levels of 9.6% for Greater London and
12.4% for Britain as a whole.
Against this background the Corporation's employment
strategy was beginning to focus on three key elements:
- Retaining existing businesses
- Attracting new firms to the area
- Training and stimulating new initiatives
As far as existing businesses were concerned, the Corporation's
policies involved assisting firms with their expansion and consolidation.
Use was being made of the Inner Urban Areas Act to provide financial assistance
in such cases. By March 1984, 52 firms had been so helped involving some
£750,000, and there were 62 applications in the pipeline involving a further
£2.3 million. Firms were particularly utilising Sections 5 and 6 of the
Act which provided for financial help for physical improvements to existing
sites and premises. DOBRIC was also making its mark and its advisers handled
over 1,100 enquiries in the six months following its opening in October
1983.
However, whilst this was encouraging, what these early
days revealed was that if the LDDC was to make a significant and early
breakthrough in creating additional jobs of any magnitude, it would have
to be through attracting new substantial businesses to the area. Such
firms it was calculated would have no need of financial grants and would
be able to make a long term contribution to the area not least in assisting
with training provision.
The Isle of Dogs EZ, with its tax incentives and relaxed
planning regime, was the magnet used to attract inward investment to the
UDA. With its 10 year life, the Corporation quite rightly focused its
initial investment in site preparation and infrastructure provision on
the Isle of Dogs. The attractions of the Zone were aggressively marketed
and promoted, both in the UK and overseas, by consultants specially appointed
for this purpose. Those companies with capacity to use the 100% capital
allowances offered by the Zone were specially targeted, as were builder
contractors to provide speculative business space. This approach soon
started to provide positive dividends in attracting in April 1984 the
Daily Telegraph printing complex to the Zone. This development alone involved
the acquisition of a 13 acre site, an investment of £60 million, 250,000
sq.ft (23,364 sq.m) of space and 2,000 jobs. At the same time, Tarmac
Properties Development agreed to build at Heron Quays over half a million
sq.ft (46,728 sq.m) of modern business space involving an investment of
some £40 million.
Corporation projections made at that time considered
that the Zone had a capacity for 4.4 million sq.ft (411,214 sq.m) of commercial
space. On this basis it was calculated that between 4,000 to 6,000 jobs
could be created by 1986 and some 8,000 to 11,500 by 1991. It was acknowledged,
however, that much would depend on the private sector's response to the
opportunities created by the Corporation. In overall terms, it was considered
that the UDA had a capacity to provide some 71,000 permanent new jobs
including those in the EZ.
The provision of the DLR, its extension to the Royals,
the development of Stolport, as London City Airport was then known, and
improved road communications were already recognised as essential ingredients
to successfully achieve the projected job scenarios.
With the potential of so many jobs on the horizon, the
LDDC decided by 1985 to adopt a more aggressive and selective marketing
stance. It entered a critical phase of promoting Docklands opportunities
to hi-technology sectors including telecommunications, information technology,
office support services, computerised printing and media, as well as the
leisure and tourism sectors. This inward investment activity focused on
"sunrise" rather than "sunset" sectors of business
and gave added impetus to the third strand of the Corporation's employment
strategy, namely training and related initiatives.
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Training for Jobs in Docklands
As has already been stated, the Corporation never had
any formal responsibility or powers relating to education or vocational
training in Docklands. Until its abolition in 1990, the Inner London Education
Authority (ILEA) shared responsibility for education in the area with
Newham as an outer London borough. After 1990, Docklands' two inner London
boroughs joined Newham as education authorities in their own right. Responsibility
for vocational training rested with a number of government departments.
These responsibilities were being reviewed and changes there were also
underway. The absence of organisational stability in these bodies at the
very time when their input was crucial was unhelpful to the Corporation
when it was developing its training initiatives.
The relationship with the Manpower Services Commission
(MSC) was particularly important in that it was the main funding agent
for adult training in the United Kingdom. In the period between 1982-84
it had carried out a major review of its activities, the results of which
were published in a Government White Paper entitled "Training for
Jobs" in January 1984. In carrying out that review and pending its
outcome, the MSC had effectively put a block on Corporation proposals
involving adult training. As the Government's training funder, the MSC's
approval was also required for the Corporation's own training initiatives
where a grant to a third party was involved. It did not help either that
there was no MSC office located within the Docklands area, or even a team
assigned to Docklands, points which did not escape the House of Commons
Employment Committee when it considered employment matters in Docklands
some four years later.
In spite of this difficult situation, the Corporation
endorsed in February 1984 a training strategy which incorporated the following
initiatives:
- The establishment of an information Technology Centre (ITEC) under
the MSC/Department of Industry programme to train young people in
new technology skills, especially those related to firms moving into
the area
- The establishment of a training workshop under a MSC programme for
young people in conventional skills recognising the needs of existing
industry
- The provision of an Access Unit, also under an available MSC programme
to identify training of older unemployed workers directing them to relevant
courses of training in existing establishment.
As part of this overall strategy, the Corporation also
resolved to offer financial support to other training initiatives in the
three Docklands boroughs and that its own programme should act as a catalyst
for other bodies to provide training. Above all, the Corporation was determined
to ensure that these initiatives would be, as Bob, later Lord, Mellish
the then Deputy Chairman, forcibly put it "training
people for real jobs".
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Providing training of any kind was to prove a difficult
task. The training ball was always being bounced between employer, government
and the trainee. Even today some would claim that no clear responsibility
exists, or alternatively responsibility exists at several levels, especially
for funding.
There was also a particular Docklands dimension for as
Alan Benjamin, an early LDDC Board Member with responsibility for education
and training matters at that time, was to write:
"Training was the least
important activity in the minds of disappearing employers, parents and
adults who became unemployed. Training for what? They said. There are
no jobs, no future".
In these circumstances, the provision of the Access Unit
and the Training Workshop proved problematic. However, a start had been
made in 1983 with the establishment of the Docklands ITEC, one of 170
units established across the country. Located in the heart of the EZ it
made good progress in training unemployed young people in the 16-18 years
age group in basic electronics, computer programming and maintenance,
as well as in automated office techniques. The courses were combined with
structured work experience with local companies and led to vocational
qualifications. Originally a 60 place centre, it increased to 100 places
by 1988-89, facilitated by LDDC funding of nearly £1.5 million.
 The
following year the Corporation decided that a "training broker"
was required to bring together employers, especially inmoving employers,
providers of training and local unemployed people. The concept was to
try and match employer needs with the employment needs of local people
and fill the skill gap with training provision from local colleges and
training institutions.
This brokering agency was named Skillnet and it was a
formal partnership between the LDDC, ILEA and the Borough of Newham to
cover the area of Docklands. The boroughs of Tower Hamlets and Southwark
were represented by ILEA. The funding was provided by the Corporation,
some professional resources by ILEA and Newham, with the European Social
Fund providing further financial support. Skillnet's board and management
team sought to actively involve employers, local unemployed people and
training providers. Skillnet's early days were not easy. As Alan Benjamin
again recalls a number of negatives surrounded the project - political
posturing, unemployed people's suspicions, obvious gaps in training provision,
courses inappropriate for required skills and a lack of courses to meet
future requirements. For example, the Poplar centre of the local technical
college was seeking to maintain at that time its welding classes whilst
resisting proposals to create a new technology department.
Against this background it was not till 1988 that Skillnet
begun to function effectively. Training providers were persuaded to modify
course material, introduce new courses, extend course places and work
more closely with employers. A good example was the situation regarding
the construction industry. At that time there were no courses in the Docklands
area which addressed the new construction techniques required for the
massive new construction programmes underway or planned. There was also
a shortage of the maintenance skills required for and in the new schemes
under construction. These gaps were subsequently filled by schemes such
as Poplar Construction Skills Training Centre, funded by the Corporation
and operated in association with Tower Hamlets Council, the Construction
Industry Training Board and Canary Wharf. Apart from this the Corporation
was concerned to ensure that Skilinet would enable local people to seek
employment on a London-wide basis, as public transport facilities improved,
especially following the opening of the DLR in 1987.
As Skilinet evolved new issues emerged. Funding was one,
in that both MSC and European Social Fund resources were only available
for schemes relating to 18-25 year olds. Under or over these ages required
separate funding, a situation which has since changed but which certainly
conditioned the nature of Skilinet's training approach at the time. Happily
by 1988 over 2,000 young people had experienced through Skillnet their
first taste of organised training for work.
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The House of Commons Employment Committee 1987-88
The Corporation's activities in job creation, training
and employment matters had always been under close and critical scrutiny
by various local activist groups and local Labour politicians. This scrutiny
was part of the wider public examination that the Corporation faced on
a regular basis from the first day of its creation. In Spring 1988, however,
the Corporation's performance was placed under formal public examination
when its officers were summoned to appear before a House of Commons Employment
Committee. The Committee had been established under the Chairmanship of
Mr Ron Leighton, a local Labour MP, to generally consider the employment
effects of UDCS. That was the ostensible purpose. However, since at that
time only two Corporations had existed for any length of time, namely
Merseyside and London Docklands, it was in effect a detailed review of
the progress made by these organisations, particularly the LDDC, given
the Committee's Chairmanship and the number of Dockland-based witnesses.
The Committee met 12 times between February and June
1988 and took evidence from a number of witnesses called before it, including
representatives from government departments, industrial training boards,
local authorities, community groups, the private sector and the Church.
The issues which the Committee wished to particularly
address were what had been the effect of UDCs in employment terms to date;
what ideas UDCs had for creating employment within their areas; whether
there was a mismatch between necessary and available skills; and whether
there were attempts to match jobs to existing skills. The Committee also
expressed a particularly strong interest in ascertaining how far incoming
jobs had gone to local people and to what extent had local employment
been encouraged. The framework for their deliberations was therefore a
rather narrow one focusing on local aspirations and needs. It neglected
to address important macro economic issues of a global and strategic nature
all of which were having such a significant impact on the Corporation's
activities of generating and attracting new investment and employment,
much of it from overseas.
Given the Committee's chosen framework, it was not surprising
that the Corporation's endeavours attracted a rather critical response.
On the other hand there was, however, considerable advantage to the LDDC
in the Committee airing in public many of the issues which had previously
concerned the Corporation and which the Committee sought to address. The
Committee's findings and recommendations published in July 1988 proved
most helpful therefore in moving further forward the work of the Corporation
in employment matters.
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By reviewing the Corporation's work the Committee acknowledged
that "no-one can walk through Docklands
and be unimpressed by the scale and excitement of the developments. Whatever
its faults, the LDDC has extended the physical area of the City of London
by increasing available office space; this will help the City to compete
with newer financial and commercial centres".
However, the Committee noted that the DoE's remit to
UDCs "contained no direct mention of employment
or job creation as a specific aim". Nor had the DoE provided
"additional direction to UDCs concerning
the desired employment impact of regeneration on the local economy or
the local and neighbouring populations".
The Committee took the view that UDCs could not be regarded
as a success if "buildings and land are
regenerated but the local community are by-passed and do not benefit from
regeneration".
Consequently, the Committee recommended that the remit
for UDCs should be altered to provide a more precise definition of regeneration
which should include "employment and unemployment
objectives".
Apart from recommending that the UDCs remit should be
more explicitly widened, the Committee's work also assisted the LDDC in
other aspects. It recommended that the Training Commission, the successor
to the MSC, should play a prominent role in providing UDCs with much needed
local labour/skills statistics, the lack of which had bedevilled much
of the Corporation's early work. Second, it recommended that the Minister
for the Inner Cities "take all necessary
steps to ensure co-ordination between government departments".
UDCs themselves, including the LDDC, were recommended
to work more closely with the Training Commission, to give a priority
to improving their relationships with local authorities and local communities,
and the LDDC was specifically asked to improve its consultation procedures
with these bodies. Finally, the Government itself was recommended to draw
the attention of UDCs to the need to "make
more effort to target employment and training initiatives on disadvantaged
groups in the local community who might otherwise miss out on the benefits
of regeneration".
In looking back, the Committee's report provided a watershed
in the Corporation's approach to employment matters bringing with it positive
benefits.It formally drew in the key employment partners to assist the
Corporation in its work, initiating a new era of collaboration between
different agencies thereby sowing the seeds for the emergence in 1991-92
of locally based Training and Enterprise Councils (TECs) (LETEC and SOLOTEC
in the case of London Docklands) and the many "compacts" between
local businesses and schools. From an internal financial viewpoint, the
extended remit greatly facilitated the funding of a whole new raft of
projects aimed at improving not just physical, but also socio-economic
conditions in the area. This expanded form of funding, initially by the
DoE, was to find later expression in the more co-ordinated approach of
Single Regeneration Budget (SRB) funding covering a number of programmes
previously managed by different government departments.
The Corporation was to make good use of this new climate
and of its new found operating and funding flexibility. This period coincided
with the tail end of the mid-1980s property boom and the start of significant
developments such as the Canary Wharf business district which at that
time held the promise of some 60,000 new jobs.
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Employment and Enterprise
In the aftermath of the House of Commons Select Committee
recommendations, the LDDC embarked on its most ambitious programme yet,
to enable people in Docklands to avail themselves of the rapidly increasing
employment opportunities. As Table 1 at Appendix A indicates, jobs had
jumped from less than 30,000 in 1985 to more than 40,000 by 1987.
 Between
1988 and 1991, the elements of education, enterprise and employment were
fused into a major three year programme costing some £10 million per annum,
a total of some £30 million in all initially. This was to grow to a total
funding of some £45 million in the six years up to 1994.
This new strategic approach was aimed first at assisting
local people to gain appropriate skills for employment and second to ensuring
that local employers had a ready supply of locally trained workers. As
statutory responsibility for training and education remained with the
local education authorities and the newly created TECs, the Corporation
further expanded its links with these agencies. This was especially important
in terms of addressing the longer term challenges raised by heightened
employer expectations through its support for education projects covering
all age groups.
Corporation support to Local Education Authorities was
provided through capital investment, assistance towards curriculum aids
and teacher support. Where projects involved capital spending on building
programmes, the Corporation's contribution was focused towards enhanced
community facilities and the under fives. Major projects during this period
included the provision of nine new primary schools, a school's extension
programme in Tower Hamlets and a new secondary school in Surrey Docks
- later expanded to support for eleven new primary schools, and two new
secondary schools, further extensions and refurbishments, three post 16
colleges and nine vocational training centres.
To assist teachers in delivering an updated and better
quality of education, extensive support for curriculum aids was provided.
The measures ranged from the production of teaching packs to the provision
of computers in schools and from support for science and technology to
projects to make the curriculum more work-orientated. As a result of the
LDDC's work Docklands has the highest computer to pupil ratio in the UK.
Support for teachers included expanding initial teacher training, placing
teachers into industry, assistance in delivering curriculum materials
and help with the purchase of equipment.
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However, as well as improving the staying on rate and
increasing participation in education and training, the Corporation was
also concerned to ensure that local people were provided with the opportunity
of accessing the highest levels of education in order to better compete
for the many service sector jobs moving into the area. Bridges were therefore
constructed between higher and further education and a special programme
initiated enabling Docklands residents to access higher education with
non-standard higher education entry qualifications. These programmes increased
participation rates in further education, increased demand for higher
education and were later to lead the Corporation to initiate with others
the Docklands Campus of the University of East London now under construction
in the Royal Docks.
In all, these longer term measures marked a new approach
taken by the Corporation in providing access to the widening range of
job opportunities that were becoming available in the area but which required
a higher level of qualification and skills than hitherto. in effect, a
comprehensive training for jobs plan was put into place which embraced
access, equality of opportunity, vocational training, employment placement
and business development. The key focus of the overall training programme
was its employment linkage, given that the purpose of training was to
secure employment. As a result, wherever possible training schemes funded
by theCorporation were geared up to direct employment opportunities. Furthermore,
together with LETEC (London East Training Enterprise Council) as its new
partner, the Corporation supported a central placement agency for those
involved in adult training in Newham. To support further direct entry
into employment the Corporation also established a Docklands based customised
training facility. This acted in a brokerage role and working closely
with employers arranged training for local people which directly matched
identified job opportunities.
 One
of these was a new labour scheme - The Partnership - established by a
number of public and private sector organisations in April 1997. This
had the objective of taking full advantage of renewed development activity
especially in Tower Hamlets. The scheme backed by Canary Wharf Ltd, the
Employment Service, Niagara, the Corporation and LETEC, together with
the three Docklands Boroughs sets out to target contracts for local businesses
and construction jobs and training for local people as some £1 billion
is invested in building out further stages of Canary Wharf, including
a hotel, leisure and residential complex, as well as other developments
on the Isle of Dogs and the Royal Docks. The scheme has the helpful feature
of providing assistance to those in financial hardship to buy tools needed
for employment. The Partnership is scheduled to run initially for a two
year period at a cost of £360,000, with the possibility of further funding
from the European Social Fund. By the end of 1997 some 160 people had
found work after registering with the Partnership.
Another example was the establishment in 1996 of the
Butlers Wharf Chef School within the Conran restaurant complex at Tower
Bridge at the cost of some £300,000. This collaborative venture is aimed
at responding to a significant shortage of trained staff in the London
area following the rapid expansion of the restaurant sector within the
Capital, including Docklands. Apart from the Corporation the partners
include Southwark Council, Conran Restaurants and the Hotel and Catering
Training Company. The School also receives support from London Training
and Enterprise Councils, Tower Hamlets Council, Bethnal Green City Challenge,
Groupe Chez Gerard, Catering and Allied and other leading restaurant groups.
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Final Outcomes and Conclusions
In common with the rest of the Capital, employment in
Docklands suffered during the recession. in regional terms London and
the South East had taken the brunt of the recession with nearly half a
million people (11.6% of the Capital's workforce) unemployed at the height
of the recession towards the end of 1992 - a rise of some 85% from the
270,000 unemployed in April 1990. In Docklands, total unemployment rose
in the same period from 2,658 to nearly 5,000. These difficulties were
exacerbated because changes in London's employment structure adversely
affected those sectors which had particularly made such significant contributions
to Docklands' recent job growth - banking, finance and other business
sectors. These had in 1992 provided 33% of all jobs in Docklands, a total
of 16,300 employees in 557 firms.
However, as London's and with it the Docklands economy
emerged from the recession in the middle 1990s, the Corporation found
itself in a particularly strong position to compete for new investment
and jobs. It had used the "fallow" years of the recession to
invest heavily in new infrastructure and transport facilities thereby
further improving access to and from the area. The "breakthrough"
achievements of 1993 saw the completion of the Docklands strategic road
network with the opening in May of the Limehouse Link, and the start of
work in December on the Jubilee Line Extension, following on from Canary
Wharf being taken out of administration in October. The March 1994 opening
of the DLR Beckon Extension gave a further impetus to expanding development
and job opportunities in the Royals and in revitalising London City Airport
operations.
All these improvement programmes greatly facilitated
a period of dramatic job growth over the Corporation's final years, with
record levels of space being let and investment made. Over 8,000 new jobs
alone were attracted in the 12 month period ending March 1995, with major
contributions being made by London Underground (2,300 jobs), Mirror Group
Newspapers (1,100 jobs), independent Newspapers (500 jobs) and Credit
Suisse (450 jobs). In the same period, continued economic recovery together
with construction progress on the Jubilee Line Extension boosted occupational
demand for office space in Docklands with total office lettings exceeding
1 million sq.ft (93,457 sq.m).
Further future job growth followed in the period 1996-97
with 1.8 million sq.ft (168,224 sq.m) of offices let in 1997 (the highest
recorded figure since 1987) and with such major international companies
as Citibank and Readers Digest seeking to establish themselves in the
new business district of Canary Wharf. Elsewhere the expansion of retail
facilities, the growth in small and medium sized businesses (68% of businesses
in Docklands have fewer than 10 employees), the expansion of DLR and London
City Airport services all contributed to Docklands' total jobs exceeding
85,000 by early 1998 and total employers growing to some 2,690.
However, it was not just the number of jobs in Docklands
itself that was important. For the first time since the closure of the
docks, the dramatic transformation of public transport was enabling Docklands
residents to access a far wider labour market. This, together with the
growth in local employment opportunities, improved educational provision,
together with enhanced staying on rates, all had a beneficial effect on
unemployment in Docklands. Thus in 1981 there were 3,533 unemployed residents
out of an economically active population of only 19,788. This contrasts
with 3,170 out of 40,077 active in April 1997. This represents a significant
decline in unemployment from nearly 18% in 1981 to under 8% in 1997, reflecting,
whilst not quantifiable, the enhanced employment opportunities available
to local people.
Perhaps, however, of even more importance is the fact
that Docklands today is no longer dependent for its employment on a narrow
band of activities with limited growth prospects. Instead, the new Docklands
economic structure that has been deliberately created by the Corporation
is based on a wide variety of employment sectors, especially the service
sectors, thereby providing a rich and varied range of new job opportunities.
Furthermore, these are available at all skill levels and importantly in
growth sectors. As can be seen from Table 2 at Appendix A, sectors which
have grown significantly since 1981 include manufacturing (98 employers
in 1981, 169 in 1997), distribution, hotels and catering (269 in 1981,
686 in 1997), financial services (80 in 1981, 725 in 1997) and other services
(168 in 1981, 500 in 1997). Today the challenge is for local people to
take full advantage of such improved conditions and to seize the opportunities
for education and employment which are now available to them.
There is no doubt that London Dockiands in economic and
employment terms is at the end of the Corporation's work far better placed
to enter the new Millennium than it was in 1981. Within its area is located
the Isle of Dogs and Canary Wharf, London's newest and fastest growing
business district. Docklands, too, probably has the most extensive transport
connections in the Capital to Continental Europe with its own international
airport and through DLR and the Jubilee Line Extension direct connection
to the existing Eurostar International Rail Terminal at Waterloo and that
proposed at Stratford with its new high speed link. Those economically
active in Docklands now have the choice of locally based jobs, of all
kinds, or easy access to those in the rest of London and the region and
indeed on the Continent. After so many years of neglect and decline, Docklands
has become integrated with the rest of London and once again its residents
have the opportunity to make their own special contribution to the economic
growth and life of the Capital.
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Table 1: Employees Working in Urban Development Area
Year |
Number |
Source of Data |
| 1978 |
37,261 |
Dept of Employment Census 1978 |
| 1981 |
27,213 |
DE Employment Census 1981 |
| 1983 |
25,032 |
IML/LDDC Survey |
| 1985 |
28,123 |
RBL/LDDC Survey |
| 1987 |
42,053 |
RBL/LDDC Survey |
| 1990 |
53,084 |
Insight/LDDC Survey |
| 1992 |
51,446 |
RSL/LDDC Survey |
| 1994 |
65,800 |
NOP/LDDC Survey |
| 1996 |
69,975 |
LDDC Estimate |
| 1997 |
72,000 |
LDDC Estimate |
| 1998 |
85,000 |
RSL/LDDC Survey |
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Table 2 : Structure of Local Employment - Key Growth Sectors
Standard Industrial Classification
(SIC 1980) |
Number of Employees
(Number of Employers) |
Absolute Change |
| |
|
1981 |
1997 |
|
| 0/1. |
Energy/Water Supply Industries |
645 (9) |
888 (13) |
+243 (+4) |
| 4. |
Other manufacturing Industries |
7,901 (98) |
11,321 (169) |
+3,420 (+71) |
| 5. |
Construction |
1,964 (89) |
2,083 (112) |
+119 (+23) |
| 6. |
Distribution, Repairs, Hotel & Catering |
4,220 (269) |
10,440 (686) |
+6,220 (+417) |
| 8. |
Banking, Finance, Insurance etc. |
1,452 (80) |
34,369 (725) |
+32,917 (+645) |
| 9. |
Other Services |
2,851 (168) |
11,961 (500) |
+9,110 (+332) |
TOTALS |
27,213 |
82,300 |
+55,087 |
| |
|
(1,014) |
(2,690) |
(+1,676) |
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Acknowledgements
The idea of writing a series of monographs on various aspects of the
Corporation's work was initiated and nutured by Eric Sorensen whilst Chief
Eexcutive of the LDDC.
This monograph has been written by Peter Turlik, one time Director of
Business Development and the EZ at the LDDC. Particular thanks are offered
to Vicki Blyth for her much appreciated support, to Julia Heynat and Rosie
Browen for practical encouragement in providing relevant data and statistics,
and to Lisa Dyer for her support and computer skills.
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Other Monographs
in this series, all published in
1997/98, are as follows
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Completion Booklets
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Annual Reports and Accounts
As with most organisations the Annual Reports and Accounts of the LDDDC are a good source of chronological information about the work of the Corporation and how it spent its money. Altogether these reports contain more than 1000 pages of information. These have been scanned and reproduced as zip files on our Annual Reports and Accounts page
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