Breathing life into dead spaces

Package is aimed at reversing urban decay

The government is to put £1 billion into urban regeneration over the next five years.

In his pre-Budget report, Chancellor Gordon Brown said his aim was to help make Britain's towns and cities better places to live and work and so stimulate enterprise and employment.

"The government's strategy is to create attractive places for individuals and business - places that create and share prosperity, and that provide good quality services that meet the needs of everyone," said Mr Brown.

He said all towns and cities should aim to be places where people want to live and businesses choose to locate through efficient land use, quality design, modern infrastructure and sustainable use of resources.

The government's strategy is to create attractive places for individuals and business

Gordon Brown

To encourage the property market in disadvantaged areas, stamp duty would be removed in those areas.

Property investors will be encouraged to redevelop "brown field" sites by giving immediate tax relief for cleaning up contaminated land.

This, the chancellor said, would make regeneration of derelict sites more viable, and so reduce pressure on green-field sites.

In order to bring life back to commercial areas and town centres, tax relief would be given for the conversion of space to create flats above shops.

In addition, VAT on property conversions to residential use will be cut to 5% and abolished altogether on houses which have been empty for more than 10 years.

Favourable reaction

Friends of the Earth spokesman Tim Jenkins said: "We are pleased that the chancellor has responded to some of the things we have been calling for."

Tony Burton, assistant director of the Council for the Protection of Rural England, said the chancellor's announcement was "a welcome package of measures which harnesses the tax system to breathe new life into our cities and protect the countryside from sprawl.

"Alongside other measures which are expected in the forthcoming Urban White Paper these new tax incentives can bring real benefits to millions of people and help save thousands of acres of England's countryside."