Spatial Inequality, Partnership Deals and Place Based Systems Change

Spatial Inequality, Partnership Deals and Place Based Systems Change

Professor Sir Geoff Mulgan and Jeremy Williams

This note forms part of IPPO’s work on spatial inequality. It aims to prompt conversations about the most effective potential policy actions at multiple levels; lessons learned; and emerging possibilities. 


There is a huge literature on the relationship between place, economics and social effects: how geography shapes options and outcomes, how cities magnify innovation, how physical factors ranging from ports to infrastructures shape development, and  how place can amplify both opportunities and disadvantages.  

Here we focus on a narrower issue: what has been learned from more than half a century of efforts to regenerate areas that have fallen behind, particularly as a result of de-industrialisation, and, more specifically, what has been learned about the effectiveness of programmes aiming at middle-level population scales (50-250k) rather than whole regions?  

We have chosen this focus because 2023 brings the 30th anniversary of the first UK Single Regeneration Budget programmes, which were an attempt at a longer-term, more holistic approach to improving places. Most of the evaluations of SRBs and similar programmes are fairly positive. Yet many more recent programmes do not always draw on their lessons, typically being less holistic, shorter term, and less focused on capacity.  

Our interest is in what lessons should be learned and what more we need to know to guide future place-based regeneration deals – and how best to organise both vertical collaboration (between different tiers of government), and horizontal collaboration (between governments, departments, business, and civil society). 

In what follows we briefly look at 

• The history of similar programmes and approaches 

• The key choices in relation to design 

• Some lessons 

• Some possible questions for the future

1. A Short History of Place-Based Partnerships

The topic of how to achieve large-scale, cross-sector collaboration to deal with social problems in places is an old one. Many big tasks require cross sector, multi-partner, multi-stakeholder collaboration, whether in a geographic area or in a sector. Many tasks also require some shared institutional capacity to coordinate and drive actions.  

There are thousands of examples of these kinds of place-based systems change in practice. The prompt for these programmes was often violent: riots, breakdowns of law and order, and a sense of whole areas falling down and falling away from the wider  society.  

A crucial step in the evolution of such programmes in the UK was Michael Heseltine’s minute to Margaret Thatcher (in1981, after the Toxteth riots) titled ‘It took a riot’, which documents the many problems Liverpool faced and proposed a series of institutional and programmatic solutions. 

In this case national government took the lead and some other programmes have been national, like the National Community Development Initiative (NCDI) in the US in the 1990s, or the successful strategies to cut rough sleeping in the UK in the 2000s, or China’s strategies to cut extreme poverty in the 2000s and 2010s.  

Much of the action has been in cities: the commonest partnerships have been found in trying to turn around deindustrialising places like Cleveland in the US, or Manchester in the UK, and there are standout examples of sustained multi-sector collaboration, like Bilbao.  

There have been many attempts to package up methods under brand names, such as Communities that Care in the1990s or Collective Impact in the 2010s. The US has many live examples from Memphis and Cincinnati’s STRIVE to the Harlem Children’s Zone in the US, while the US Congress also provided funding to hundreds of what it called Opportunity Zones in the late 2010s.  

The European Union meanwhile promoted ‘smart specialisation’ methods to guide its many regional and social fund programmes, and gathers a huge amount of evidence about urban programmes of all kinds

Although most of these are hard to evaluate because of the sheer number of variables involved, and because they often don’t last long enough for serious assessment, there is plenty of evidence of success (see for example the debates about the effectiveness of the Harlem Children’s Zone and the long-term impact of holistic urban regeneration schemes). There has also been serious academic analysis in the field over many decades, such as classics like Eugene Bardach’s work on cross-agency collaboration. 

The National Community Development Initiative (NCDI) was one of the most interesting US examples, partly because it straddled philanthropy, finance and  government, and took advantage of legislation (the Community Reinvestment Act which forced banks to change lending policies). In the 1990s the NCDI pooled the budgets of a group of foundations, banks and others to create an infrastructure of community finance across the US, both at a national level and in multiple poor communities. It directly committed $250 million from seven foundations and private partners, and leveraged around $2 billion, creating a network of hundreds of  Community Development Corporations and national bodies like LISC and the Enterprise Foundation (Rockefeller kept its work alive in the ‘Living Cities’ programme).  

The US has had many other programmes, from the Ford Foundation’s Gray Areas program and the federal government’s Community Action Programs, to initiatives like the Community Reinvestment Act, housing redevelopment through HOPE VI, Empowerment Zones, New Markets Tax Credit investments, Choice Neighbourhoods, Promise Neighbourhoods. 

The UK began an emphasis on place-based regeneration in the 1970s and 1980s, leading in the1990s to programmes including the Single Regeneration Budget (SRB) and New Deal for Communities (part of the broader Neighbourhood Renewal Strategy), which channelled billions of pounds into places which had fallen behind.  

The majority of the evaluations of these ten or more years later were broadly positive, though the detail is usually complex and messy, dependent on particular people and relationships. In the case of the New Deal for Communities (NDCs), improvements in outcomes were found across 32 of the 36 core indicators and when compared to non NDC areas greater improvement was shown in 18. In other words, they achieved both absolute and relative gains. 

2. Deals Between Tiers

Many of these are essentially deals between lower and higher tier governments. The latter provide resources and power in return for some confidence that these will be used effectively. They are necessary because the lower tiers lack the tax base or capacities to turn themselves around. In countries with significant decentralisation such deals are unnecessary. 

Most such deals involve: some joint activity to diagnose the problem, which then leads onto commitments towards action to solve it, and then some way to monitor results and adjust. 

The SRB was an example of this; others attempted more holistic deals that share some of the net benefits to public spending from preventive work (eg in health, or criminal  justice), such as the various Justice Reinvestment projects.  

But although the job of deciding on tasks, defining metrics and following them through with performance management tools can seem easy, in practice each of these steps bring challenges, and the greater the mismatch between the shape of the problem and the shape of the organisations with some power to act on it, the greater the challenge  of coordination. It’s a problem if the basic diagnosis is flawed; a problem if the actions committed to aren’t the right ones; a problem if the participants look at issues through radically different frames; a problem if the commitments are weak; a problem if there isn’t sufficient implementation capacity; a problem if street level cultures aren’t right; and a problem if the metrics don’t capture what’s important.  

Moreover, it is a general rule that the closer you get to the ground, or the more localised the intervention, the messier the human realities, and the harder it is for general, standardised policies to work. All such programmes have had to strike a balance between the two poles of top-down direction on the one hand, and untrammelled community leadership on the other. Moreover, community leadership is rarely a simple thing: there are often big differences of perspective between different generations and different groups. 

Such deals also have had to find a ‘nested’ approach, covering actions at multiple scales from the provision of infrastructure to education, and from the linkages of all  kinds that can transform patterns of opportunity (new road, rail link, airport, or broadband capacity) to addressing the needs of people.  

Finally, they have depended on very specific human qualities: the ability to curate, facilitate and nudge a disparate group towards common purpose is extraordinarily important, requiring tact, wisdom, strength and an odd mix of charisma and quietness.  

3. Design Choices

The design of any programmes or deals involves a series of choices. Some of these are about focus, for example on healthcare, crime, education or jobs; some are choices about scale; and some are choices about agency. Here we explore some of the key  strategic choices.

3.1 What To Prioritise

Resources need to be devoted to both fast and slow priorities. Often communities themselves prioritise cutting down on crime, and this may be key to building confidence – though difficult if organised crime is strong or significant proportions of young people make a living from petty crime. 

In many places education is also another key, but often influenced at a higher level. London’s success in dramatically improving educational outcomes in its poorer areas in the 2000s is a rare example of a combination of city-level and place-based activism. Access to skills and entry level jobs is another part of all such programmes – though much easier if there is a buoyant economy nearby. 

Then there are many potential actions on public health and the physical environment. These all need to be at least roughly aligned.

3.2 The Choice of People, Places or Both

All place-based initiatives face dilemmas about how to balance prioritising impacts on the place whether a small neighbourhood, a town or a city, and the impacts on the  people in the place.  

At the extreme the indicators for a place may improve simply because the make-up of the people has changed. This often happens within cities with gentrification – house prices and rents go up, displacing the relatively poor, as the relatively wealthy move in. From some perspectives this may be good for the place, but this is often not so good for the displaced people who were there before. Alternatively, in a place that has lost its jobs, it might be desirable for young people to move out to another place  with better opportunities: good for the people but often not so good for the place.  

One of the ultimate aims in a democracy should be to improve people’s prospects including by reducing the ways in which the conditions of a place harm their opportunities. But in practice the politics around this is complex and often there will  be strong political pressures to prioritise other issues beyond place.  

3.3 The Choice of How Fast, How Slow

Most place-based initiatives take time and usually at least ten years. This is partly because of the need to build up capability in local leadership and to establish relationships of trust as well as because the actions themselves are often by their nature quite slow, such as building infrastructures or housing, or shifting cultures. 

Many programmes put a big emphasis on building up assets in the community: buildings or land that can be used as a base for investment, and that also help with the growth of capabilities. This inevitably takes time too.  

There are also, however, methods that can be used to inject urgency into partnerships and reduce the risk of them becoming empty talking shops, drawing on experience of systems change and the work around the world to make systems thinking practical.

Some of these methods involve bringing the players in a system together, for example all the people acting on the health of the frail elderly in an area, or on school-to-work  transitions, and often they haven’t met before. These seek to secure the commitment  of the leaders of the main organisations; set stretching targets; and then provide active support to them in collectively reshaping how the system works to meet targets over 90 or 100-day sprints. When these work well, they tap into the deep knowledge of  practitioners; inject urgency; and forge a network of strong relationships. The system becomes aware of itself and redesigns itself to work better.  

All place-based programmes probably need to combine fast and slow in the design of programmes and budgets, usually with sequential strategies that begin with early wins, often around issues such as public spaces or low- level crime, before moving onto deeper, longer-term issues where there is a greater lag between actions and outcomes.

3.4 The Choice Between Light or Heavy

The tools then run in a continuum from the light to the heavy. The light ones involve mutual coordination: public commitments but without legal force, and some use of open data collection and shared metrics. This is roughly what the European Union does at a national level: the principle of open coordination is that explicit targets and transparent actions will encourage convergent actions. It’s also what most of the recent projects labelled ‘collective impact’ do. They are coalitions that work so long as the partners are willing.

The heavier tools formally combine budgets, targets, teams, and reporting  requirements over long periods of time and legally binding obligations. Many of the urban regeneration collaborations were heavy in this sense, with formal powers and rewards to incentivise sustained collaborations – including models like the Single Regeneration Budget, New Deal for Communities or Total Place in the UK. In the US, the National Community Development Initiative (NCDI) was another example of relatively strong tools, with formally pooled money. The many EU-funded collaborations also tend to be strong in this sense even if they are often in reality quite cosmetic. 

3.5 Choices About the Role for Government

The tools also run in a continuum from government-dominated to wholly bypassing government. For most social problems government is likely to be better suited (in  theory) to acting on the problem, having more resources, more legitimacy and more  information. But this primacy can become a problem if government is inflexible, wedded to old solutions, or poor at partnering. It’s also bound to be itself fragmented, especially where two or three different tiers of government are involved. So, a lot of subtle knowledge has built up over the years about how to get the benefits of collaboration without government smothering everything. There are many interesting examples of attempts to square this circle. One unusual recent example was Delivering Social Change in Northern Ireland, substantially funded by Atlantic Philanthropies, but implemented by government, and aimed at tackling a range of issues including dementia and integrated schooling.  

3.6 Choices About What to Measure

Partnerships need measurable goals and ways of understanding what needs to be  done and whether actions are working. There are innumerable frameworks for doing this, and a wide range of place-based indicators for jobs, start-ups, education, health,  trust and much more.  

Many local data sets are now in use around the world. However, these do not of themselves provide insights into causation: which actions led to which effects, and they cannot easily distinguish when the key effects came from trends at another level,  such as the broader regional growth story or the effects of migration. 

Moreover, in all cases there are choices about striking a balance between breadth and focus. It may be easy to identify 20+ key indicators but having done so it’s likely that all will be ignored. 

Some of the most useful ones attempt to combine measurement of objective material indicators and more subjective ones. One major study of changing social needs showed how to use data and statistics, combined with ethnography, to map both the psychological and material wellbeing of whole populations and local areas. It is possible this will become mainstream in the future not least because of evidence that psychological well-being turned out to be a predictor of other behaviours, such as voting patterns on Brexit. Other localised approaches such as the WARM framework, were developed as a tool for local communities to think about their needs and priorities. We are keen to learn more about which kinds of local data sets are in practice most useful and used – not just as performance management tools for higher tiers of government or partnerships but also for community engagement.

3.7 Choices About the Links to Public Finance

The sums devoted to place-based regeneration are generally a very small proportion of total public spending. So, in one view it is therefore vital to connect any actions to a picture of what is happening at an aggregate level, for example to school funding or  infrastructure. 

This was the logic of various public sector programmes such as Total Place which aimed to integrate all of public spending and activity, and the London Collaborative which aimed to develop a more relational approach alongside more formal partnerships.

Despite many efforts by the ONS and others, few if any governments have good methods for tracking spending in a place incorporating all the flows into a place from infrastructure to social security and from health to education, and their impacts.  Nevertheless, the various attempts to construct deals that support preventive spending with some sharing of the benefits five or ten years later – such as Manchester’s – could be pointers for the future. 

3.7 Choices About the Role of Culture, the Arts and Attractiveness

Many cities have used initiatives around the arts as part of programmes for renewal: these work partly as signalling devices, growing civic confidence and attraction, and partly as economic tools to grow new firms and jobs. Bilbao’s Guggenheim Museum is probably the most famous example, with the investment in a show-piece project of urban waterfront regeneration being used a blueprint by other post-industrial communities seeking their own piece of the ‘Bilbao Effect’. Likewise, the benefits of regeneration that seeks to attract affluent, mobile, members of a “creative class” comprising everyone from musicians to nurses to programmers, have been influential, although the desirability and efficacy of such an approach has been contested

However, forty years of case studies and evaluations confirm the positive impacts of culture on a locality. This recent survey from the Arts Council for example, shows the impacts on community spirit and belonging, growing jobs, and some of the dynamic impacts on place which are often on specific parts of city centres.

3.8 Choices About How Much to Spend on Growing Local Capacity

Place-based systems change requires local capacity for leadership, management and implementation. That capacity will be in part political and in part administrative and will include the need for on-the-ground knowledge and resource to develop what Hildreth and Bailey refer to as “policy actions embedded in, and linked to the specific needs and available resources of a locality”.  

But how big a role should capacity building play in any deals or partnerships? In the UK, the hollowing out of policy capacity at a local level, particularly as a result of the austerity policies enacting in response to the 2008 economic crisis, means that many jurisdictions lack much capacity to co-ordinate. The renewed emphasis on devolution via regional and city deals between central government and new combined authorities provides a prompt for more attention to capacity, but the scale and spread of programmes for training, whether for local political leaders, officials, or partnership participants, has greatly diminished (though there are exceptions, such as Common Purpose or university based tri-sector leadership courses) which try to inculcate familiarity with collaboration, as well as personal links, and to address the cultural underpinnings of collaboration. Another potential aspect of this is growing the next generation of community leaders – as prioritised in programmes such as UpRising – who may have a very different perspective to the often quite old current community leaders.  We would be keen to see any recent surveys of the overall state and effectiveness of such programmes. 

4. The Roles of Structure, Process and Culture 

A general lesson may be that although structures help in aiding vertical and horizontal  coordination they are often less important than processes, and that these in turn are  less important than cultures. Structure tends to be attended to first and there are  many options such as joint boards, partnership bodies, implementation teams, and double and triple keys. Meanwhile processes and cultures can be a blind spot for the  more technocratic, or mechanistic, approaches to collaboration.  

Announcing the collaboration and getting the principals to turn up is (relatively) easy. So is the paraphernalia of shared metrics and reporting. But lasting impact depends on much deeper-rooted habits of collaboration, for example between key professions  on the ground. This tends to take a lot longer. In practice partnership structures on their own may be little more than cosmetic. They tend to have most impact when they are given enough time to become embedded in everyday cultures, and are reinforced  by the main drivers of behaviour, from how leaders act, to appraisal and pay systems. They also work best if political pressures do not push in an opposite direction. 

So, in one view, the best collaborations are grown more as movements than as coordinated performance management with the main focus of work on relationships and trust-building – and nurturing confidence that change will actually work.  

Much of the activity on systems change in health, described earlier, has prioritised this – strengthening horizontal links and confidence between public sector staff, professionals, NGOs and others – as a vital complement to top- down authorisation from leaders and the use of formal metrics. This was also an emphasis for the London Collaborative which involved building stronger informal networks and trust to complement the formal structures and processes that linked the three tiers of government active in London.

Part of the rationale for such an approach is that although partnerships have clear formal structures and boards that bring in the main actors, in most cases the actual relationships and dynamics are different from the formal organograms. In this context, Social Network Analysis and other tools can be used to see how people are useful to each other or share information. For example, sometimes a junior official could play a decisive role in weaving the partnerships together, and sometimes institutions which should be vital connectors – like a local council – may be seen as barriers rather than enablers.  

Another possible lesson is more counter-intuitive. Organisers of collaboration often want the participants to get back to first principles, and then move logically on to actions. But some experience, and political science, suggests that it may be harder to  get a disparate group to agree on underlying principles and values than it is to get them to agree on actions.  

5. Why Collaboration is Hard – and Not Always Desirable

Any kind of collaboration can be frustrating, imperfect and time-consuming, bringing costs as well as benefits. Silos exist for a reason and reinforce themselves for good reasons too: it’s not possible for everyone to talk to everyone all the time. Any anti silo measure brings its own trade-offs, and its own new handovers.  

In the 1990s the joke used to be that the only thing worse than organisations never talking to each other was organisations doing nothing but talk to each other. The critical question for any horizontal collaboration should therefore be whether it adds more than it subtracts, since it inevitably creates new boundaries, and new problems of coordination.  

Another critical issue is that when radical innovation is required, bringing incumbents into collaboration can slow down necessary change. Imagine a cross-sectoral collaboration to improve the book retailing business in a city. If all the bookshops and libraries had been included, it would almost certainly have tried to crush new innovations like Amazon. Similarly, a collaboration of existing banks to improve financial services would be highly likely to exclude competing peer-to-peer and other alternative finance tools. So, collaborations work best when there aren’t fundamental clashes of interest.  

A third challenge stems from democracy. All jurisdictions will have an existing legitimate authority – a municipal or regional government. Some collaborations are interwoven with democratic power and defer to elected leaders. Others try to circumvent them. Often, community leaders claim a competing legitimacy to that of elected politicians. Since collaborations often bring in unaccountable philanthropic money, this can create any number of tensions and problems including questions of democratic legitimacy, local control and accountability. A main criticism of partnership working is that it removes areas of political contestation from democratic life, rendering them overly technical and post-political. This sees governing retooled as governance, and elected representatives recast as only one set of a number of stakeholders. 

A final challenge concerns argument. Any kind of partnership encourages people to  form a consensus. That can be very healthy. But often the best thinking depends on vigorous, robust argument. A common finding of partnership boards is that they brush  difficult issues under the carpet and don’t cultivate the kind of hard argument that is found within the best teams and organisations.  

6. Making Collaboration Easier

Several recent technology trends could be making large scale coordination easier.  Open data allows for more systematic scrutiny of funding decisions and actions, for example with ‘360 degree giving’ in philanthropy promoting provision of machine-readable data on all grants, purposes and locations. Washfunders points in the same direction, mapping projects and programmes around access to water. 

There are now many more online tools to help dispersed groups work together, from simple ones like Google Docs or Slack to complex ones like Genius. Some older ones still look impressive – such as the tool developed by Harvard’s Rosabeth Moss Kanter with IBM in the early 2000s for helping a whole system to navigate change. These online tools are complements, not substitutes, for face- to- face engagement. But they’ve improved a lot and they can embed the habits of collaboration.  

IPPO is currently investigating the many types of system map that can be used to help a disparate system develop a shared picture of problems and opportunities (see for example our most recent one on home energy transitions).

There are also digital tools for self-assessing collaborations. Social network analysis can map the reality of partnerships by asking several hundred people working in a system at city level such as the system delivering secondary education or cutting domestic violence who they found was helpful to them in their daily work. While these methods remain uniquely well-suited to showing the reality of collaboration they are very rarely used, perhaps because they can be challenging to figures higher up in hierarchies.  

A related trend is also the spread of cross-cutting leadership development programmes. There are now lots of organisations skilled in training leaders from across sectors to cultivate a shared sense of responsibility.

7. Where Next?

Despite the number of studies and evaluations undertaken over the last few decades it is less certain that the field has moved forward in terms of either understanding or the sophistication of action. This is as much about the absorptive capacity of key  actors as about the supply of research. As a result, a series of questions remain unanswered, both about the evidence itself and about the use of the evidence. 

Some of the questions of evidence concern the various choices listed in section 3, ranging from the potential role of culture to questions of capacity. Because all such interventions influence each other it is never possible to extract one or two causal  factors and prove that they were decisive. 

There are questions about the links between psychological and material wellbeing and their interactions. 

Then there are questions about use of evidence. For example, what are good examples of local data sets and syntheses that are actually used and useful? What do we know about how best to support policy-makers capacity to absorb knowledge? What kinds of experiment are most needed?  

Finally, do we need better theory, and evidence, about the links between micro, meso and macro levels – whether in relation to structural change, fiscal capacity or growth strategies? 

IPPO welcomes your input into our work on Spatial Inequality including the issues raised in this paper, so please do get in touch with the authors.

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