1
Managing mismatches
The governance of housing in a shrinking region. A case study of Parkstad
Limburg.
Author: David Louwerse Master’s thesis Political Sciences Specialization: Public Policy and Governance
June 2017
First reader: Ms. Dr. F. van Hooren Second reader: Mr. Dr. I. Verhoeven
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Content
Introduction ... 5
1. Theoretical framework ... 8
1.1 Shrinkage ... 8
What are the main causes of shrinkage? ... 8
What are manifestations of shrinkage? ... 9
1.2 Governance ... 10
Urban governance ... 11
Modes of governance ... 11
1.3 The governance of shrinkage ... 13
Fiscal gap ... 14
Entrepreneurial governance ... 14
Grant coalitions and dependency ... 15
New programs and agencies ... 17
Modes of governance ... 17 Conclusions ... 18 2. Methods ... 19 2.1 Methodology ... 19 2.2 Research design ... 19 2.3 Sampling ... 20 2.4 Operationalisation ... 21
2.5 Methods of data collection and analysis ... 23
3. Analysis ... 24
3.1 Case description ... 24
Mining history... 24
Demographic change ... 26
Demographic decline as non-issue ... 28
Dealing with shrinkage on the local and regional level ... 29
3.2 The core issue: care reforms and housing ... 31
Vacancies and restructuring ... 31
Care reforms ... 32
The effects of the WMO in Parkstad ... 33
3.3 Actors and institutions ... 35
Governmental institutions ... 35
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Care companies ... 39
Private capital ... 40
Conclusions ... 41
3.4 Interactions... 43
Moving onto the regular housing market ... 44
Home adjustments ... 45
Local performance agreements... 46
Parkstad housing policy ... 47
Steering committee Housing and Care ... 48
Ties to the national government ... 50
Conclusions ... 52
3.5 Parkstad’s governance reconsidered ... 52
Fiscal gap ... 53
Entrepreneurial governance ... 54
Dependency ... 55
New programs and agencies ... 56
Modes of governance ... 56 National policies ... 58 Islands of policymaking ... 58 4 Conclusions ... 60 Societal implications ... 62 Policy recommendations ... 62 5 Sources ... 64 6 Appendix: Respondents ... 69
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Introduction
Shrinkage is a combination of economic decline and demographic decline. Shrinking cities and regions experience a wide variety of socio-economic problems, ranging from a high level of vacancies and declining real estate values to selective outmigration of the young and talented and the depletion of public facilities. The combination of these factors lead to the effect of cumulative causation: once a negative development in an area has started, it reinforces itself and makes the situation even worse. Local governments need to adequately deal with these challenges to prevent a further deterioration of the quality of life. However, shrinkage has certain characteristics that impede effective governance. Population losses cause a loss of public revenues, whilst shrinking regions are unattractive for private capital. As a consequence, governance systems in shrinking regions have to cope with these problems with little funds at their disposal. This research investigates the governance of shrinkage through a case study of Parkstad Limburg, an urban area in the southeast of the Netherlands. Because studying shrinkage in general is too broad for the scope of a master’s thesis, this research focuses on the policy field of housing, as this field is highly affected by population developments. The research question is:
How does Parkstad Limburg’s governance system respond to the effects of shrinkage in the field of housing?
The governance of shrinkage is a relatively new research topic. Thus far, scholars in this field have focused on shrinking cities, rather than on regions. Several authors have explored this theme by doing case studies in European cities (Bontje 2004; Bernt 2009; Cocks & Couch 2012; Rink et al. 2011). One of their main conclusions is that the governance of shrinkage is highly context-dependent. It is shaped by an interplay of social, economic, institutional and political circumstances on various territorial levels. The developments of both shrinkage and the governance system are path-dependent. There is no such thing as a blueprint for the governance of shrinkage. Nevertheless, there are certain similarities in the way governance systems respond to shrinkage. These authors argue that, in many instances, local governance systems become more dependent on funds provided by higher tiers of government, mostly from the national government or the European Union (EU). This leads to instable, incoherent and contradictory governance arrangements that are ‘bargaining over the bill paid by someone else’ (Bernt 2009, p.765).
Studying the governance of shrinkage in the Netherlands is a research aim in its own right. Shrinkage is a relatively new problem that is spreading rapidly throughout the country. The Netherlands currently has nine shrinking regions, that contain eight percent of the Dutch population (Provincie Groningen et al. 2016, p.4). There are eleven so-called ‘anticipating regions’, where shrinkage is expected in the near future. Essentially, shrinkage is a form of regional inequality. How
6 much regional inequality one finds acceptable is in fact a highly political question that relates to attitudes on redistribution and the role of the government toward society. There is currently a discussion in the Netherlands about the responsibility of the national government toward shrinking regions (Hovens 2016, p.69). Some politicians argue that the severity and scale of the problem necessitate national assistance, whereas others state that demographic developments are normal phenomena that should be anticipated on locally and regionally. Regardless of one’s stance in this debate, it should be clear that shrinkage is a highly urgent and relevant topic in local politics, as it seriously affects liveability. This problem is increasingly recognized by politicians and scholars. In 2009, the national government introduced an ‘Action Plan Population Decrease’. In 2015, the University of Groningen appointed the country’s first professor by special appointment in the field of Population Decrease and Liveability.
The case of Parkstad differs from previously studied cases in two respects. Firstly, it not a city. Parkstad is an urbanized area consisting of eight different municipalities cooperating on more or less equal terms. As shrinkage is a common regional problem, inter-municipal cooperation is required in formulating policy responses. This gives rise to various types of coordination-related problems. Furthermore, while doing fieldwork, I found that Parkstad has hardly received financial aid to cope with shrinkage. In this regard, Parkstad deviates from other cases. This adds to the theoretical significance of this study. Liverpool and East German shrinking cities have been subjected to national programs that provided funds for the restructuring of the housing market (Bernt 2009; Cocks & Couch 2012). Authors have found that these programs rather strongly shape local governance arrangements. In Genoa, there were no large-scale national programs, but local authorities managed to obtain funds from various sources for individual projects and could occasionally rely on private investments (Bini et al. 2011). When compared to these cities, Parkstad has received only little external support for dealing with its housing issues. The lack of financial aid limits the capacities to cope with the consequences of shrinkage. Altogether, the case of Parkstad is interesting from a theoretical perspective, because 1) It has received relatively little external support, and 2) Its institutional context is more diffuse than those of previous cases. I will try to identify new causal mechanisms in the relation between shrinkage and governance, that will be useful for future studies into this topic. Moreover, an analysis of the governance of shrinkage in Parkstad will allow for an exploration of the scope conditions of existing theories on the governance of shrinkage.
I focus on the changes on the housing market that have resulted from the transformation of the Dutch social care system in 2015, when the national government amended the Wet Maatschappelijke Ondersteuning (Law Societal Support, WMO). Due to its high shares of care recipients, these reforms have more impact on Parkstad than on other regions. Because of the
7 structural oversupply of housing, the recipe for dealing with the new WMO in growing regions will not work in Parkstad, offering a great challenge for the local and regional governance system. My results show that the capacities of local parties to deal with this issue are constrained by a structural lack of funds and by adverse effects of national policies. The WMO brings together two intersecting policy fields, housing and care, that have dissimilar institutional arrangements. This has given rise to a rather complex governance network, in which authorities are dispersed over different territorial levels. The lack of central steering leads to ‘islands of policymaking’ and heterogeneous policies, producing suboptimal outcomes. Recent attempts to harmonize policies and create more central steering are promising.
The research relies on data collected from stakeholder interviews, policy documents, governmental publications, think tank reports and academic literature. The first chapter comprises the theoretical framework that constitutes the basis for this research. The framework is divided into sections on concepts (shrinkage, governance) and theories (the governance of shrinkage). The second chapter explains my methodological choices. It addresses the research design, procedures of sampling, the operationalisation and the methods of data collection and analysis. The third chapter presents the analysis of the empirical material. I have formulated five sub-questions that will be answered individually. In the conclusion, I will shortly summarize my findings and formulate an answer to the main question. Afterwards, I will reflect on the theoretical and societal implications of my findings. Finally, I will make suggestions for further research and present policy recommendations.
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1. Theoretical framework
1.1 Shrinkage
I start out by elaborating on the concept of shrinkage, because it is important to fully grasp ‘the problem’ that is being governed, before turning to an analysis of governance. A review of the literature on shrinkage will shed light on its causes and consequences. The recognition of different types of shrinking regions will help to understand what larger class of cases Parkstad is an instance of. I follow Hoekveld’s definition, who claims that: ‘’Shrinkage is a combination of economic decline and demographic decline, which leads to an amalgamation of social, environmental and financial problems, which influences the livelihoods of the inhabitants in those affected areas.’’ (Hoekveld 2014, p.3). Economic decline means a general slowdown of economic activities. A main indicator is the loss of jobs. Demographic decline means population loss, which can be measured either by the total population figures, or by the number of households. This second indicator is especially relevant for housing policy.
What are the main causes of shrinkage?
The processes of economic and demographic decline are not new, nor specifically western. Cities and regions have always been characterized by cycles of growth and decline. However, shrinkage is spreading throughout the world, not in the least in Europe. 54% of the urban regions in the European Union have lost population in recent years (Wiechmann & Pallagst 2012, p.261). Globalization has been identified as a driving factor behind the spread of shrinkage (Wiechmann & Pallagst 2012; Hospers 2013). Cunningham-Sabot et al. argue that ever-shortened innovation cycles and an increasing speed of technical change and footloose capital expose cities more suddenly than ever to the loss of companies, jobs and population (Cunningham-Sabot et al. 2014, p.24). Industries and production sites in developed countries now face competition from low-cost countries where goods can be produced much cheaper. This causes de-industrialization and the closing of production sites. In several cases, these consequences of globalization are economically disastrous for the affected areas, as they introduce a large-scale loss of economic activities, jobs and population.
However, the conceptualization of shrinkage as solely the result of economic transformations would be too narrow. Pallagst et al. identify five causes of shrinkage (Pallagst et al. 2014, p.4):
1. Economic factors: de-industrialization in non-competitive spots, old industrial areas, peripheral areas, location closures (e.g. of mining sites)
2. Demographic change: ageing population, low fertility rate, depopulation areas
3. Suburbanization: flight of people and jobs to suburbs, hollowing out of the core city, urban sprawl
9 4. Structural upheaval: economic reorganization, collapse of an entire political system,
resettlements, unrest, war
5. Environmental pollution: natural disasters, pollution, climate change
Of these five causes, the first two are especially important in contemporary Western Europe. The current demographic change is partly driven by social-behavioral factors such as declining numbers of married couples, rising divorce rates and falling fertility rates (Wiechmann & Pallagst 2012, p.264). Many countries observe fertility rates far below the level necessary to sustain the population. At the same time, the increasing life expectancy in these countries leads to an ageing of the population. All factors combined cause a demographic transition on the national scale, as the total population figures stagnate or decrease, and, at the same time, the share of older people within the population increases. These effects are reinforced in regions where young people move away.
Typically, the causes of shrinkage do not evolve independently, but mutually influence each other. Hoekveld argues that one cannot simply state that demographic decline is an effect of economic decline, or vice versa (Hoekveld 2014, p.124). Shrinkage is an example of ‘cumulative causation’. This means that once a negative development in an area has started, it sets in motion other developments and thus leads to cumulative effects (Hospers 2012, p.10). It is well established that economic and demographic developments are interrelated. Economic activity creates jobs. New jobs attract new residents. The opposite process can be observed in the case of a loss of jobs: this stimulates out-migration. Furthermore, demographic decline leads to a declining base for, for example, public service (health care, education, public transport). A depletion of public amenities, in turn, negatively influences the livability of an area and might cause further out-migration. In this way, consequences of shrinkage become causes of further shrinkage.
What are manifestations of shrinkage?
Population loss itself is not necessarily a problem. In some instances, it is even considered as a positive development. However, a substantial and structural decline of population and households affects the quality of life in a region. Hospers divides the effects of shrinkage into three categories: hardware, software and mindware (Hospers 2013, p.1510). The hardware consists of the visible, tangible and countable aspects of an area: the housing market, the infrastructure, the local economy, the municipal budget and provisions such as health care, public transport and education. A shrinking population has a decreasing demand for housing, infrastructure and amenities. This leads to oversupply, increasing costs per resident and a depletion of the supply. Housing blocks will deteriorate and eventually become unsalable. At the same time, businesses, schools and shopping centers are forced to close or to relocate, creating vacancies in the non-residential real estate as well. Economically, shrinkage often
10 causes mismatches on the labor market. Quantitative mismatches occur when there are structurally too few jobs. Qualitative mismatches occur when the available jobs do not match with the skills or educational level of the population.
The software refers to the ‘social capital’ of a shrinking area. Often, shrinkage leads to selective outmigration, leaving the elderly and underprivileged behind (Hospers 2013, p.1511). Shrinking areas are less likely to see innovation and entrepreneurship, because the people who typically endorse this are leaving. Furthermore, the overrepresentation of lower income-households in shrinking areas makes that these areas face more poverty-related social problems such as criminality, bad health and addictions than other regions. Lastly, shrinkage influences the mindware or image of an area. Once an area is labelled as ‘shrinking’, it will be associated with the negative developments described above. Such a negative reputation is harmful, because it scares off potential investors and residents.
1.2 Governance
The consequences of shrinkage threaten the liveability of the affected areas. It is therefore considered as a public problem that requires policy responses. Public policy scholars have observed that the context of policymaking is changing, through the emergence of governance networks. These changes impact on the opportunity structures available to local and regional governance systems coping with shrinkage.
More than before, information is contested (Crozier 2007) and problems are wicked (Rittel & Webber 1973). A wicked problem is of a more or less unique nature. There is no process of trial and error in solving the problem, as each attempt has consequences that cannot be reversed. Typically, wicked problems are interrelated and are never completely solved, only temporarily re-solved. The changing context has been eloquently described by Maarten Hajer, who argued that solutions for pressing problems often cannot be found within the boundaries of sovereign politics (Hajer 2003). In such instances, policymaking takes place in an ‘institutional void’. In the void, there are no generally accepted rules and norms according to which politics is to be conducted and policy measures are to be agreed upon. This is not to say that state institutions are of no importance, or that there are no rules. Rather, Hajer argues, political action takes place next to or across institutional orders, thus challenging the rules and norms of participants. Furthermore, society itself is changing. It is characterized by individualization and a plurality of values (Klijn & Skelcher 2007, p.597).
Erik-Hans Klijn argues that the ‘new society’ and the new problems have spurred a structural transformation of the policymaking process (Klijn 2008). He argues that the increasing complexity of societal problems reinforces governmental dependence on societal actors. Various actors have to be included into the process of policymaking and implementation (Klijn 2008, p.506). This led to the
11 emergence of governance networks. The concept of governance networks is of key importance in the governance literature. It refers to ‘’public policy making and implementation through a web of relationships between government, business and civil society actors’’ (Klijn 2008, p.511). For Klijn, governance is the process that takes place within governance networks. This process is often described as ‘horizontal’, as opposed to ‘hierarchical’, because all actors are interdependent for achieving results. This interdependence does not suggest, though, that all actors are equally influential. Lastly, it would be an exaggeration to state that governance networks have replaced or are replacing hierarchical government (Klijn 2008, p.509). Many governmental tasks are still performed in a hierarchical manner.
Urban governance
The governance of shrinkage has been studied from an urban governance-perspective, as this field focuses on the specifics of governance on the local level. Urban governance, as defined by Pierre and Peters (2012), is about the formulation and pursuit of collective goals at the local level of the political system. A main theme in urban governance literature is the ‘entrepreneurialization’ of local politics (Jessop 2002; Harvey 1989; Brenner & Theodore 2002). This means that local governments have moved away from managerial modes of governance. Managerial governance is welfare-oriented. It focuses on the local provision of services, facilities and benefits to urban populations (Harvey 1989). These have been superseded or complemented by politics that focus on local economic development and local competitiveness (Brenner & Theodore 2002). Brenner and Theodore explain the rise of local entrepreneurialism as an effect of the emergence of neoliberalism. Neoliberalism is the belief that open, competitive, and unregulated markets that are liberated from all forms of state interference represent the optimal mechanism for economic development (Ibid). Urban governance authors claim that neoliberalism has inspired transformations both on the national and the local level of government. On the national scale, neoliberal state reforms often entail cuts in welfare provisions and subsidiarity (the devolution of responsibilities to lower state levels) (Jessop 2002, pp.464–6). On the local scale, the entrepreneurial government has different policy goals. Local policies aim to enhance economic activities and to create employment. It produces new modes of governance, as governmental institutions more actively participate in economic development projects and engage in public-private partnerships (Brenner & Theodore 2002, p.369). These partnerships are oriented towards economic growth and are called ‘growth coalitions’. These claims have been derived from studies of growing cities. This study aims to assess whether they apply in a shrinking areas as well.
Modes of governance
Another aims of this research is to compare the urban governance responses in Parkstad to those in other cases. DiGaetano and Strom (2003) have developed the ‘modes of governance’-typology, that allows for cross-national comparisons of local governance arrangements. They have studied the
12 classical question ‘Who gets what, why and with which consequences?’ in different institutional contexts (Ibid, p.357). I will follow previous authors on the governance of shrinkage by assessing which ‘modes of governance’ can be observed in my case.
Modes of governance are informal arrangements that link institutions and determine how a city is governed (Ibid, p. 363). A mode of governance consists of four dimensions: ‘’First, governing relations are the modes of interaction between government officials and private sector (economic or community) interests. Second, the governing logic is the manner or method by which political decisions are taken. Third, the key decision makers may include various combinations of politicians, bureaucrats and agents of various civic (economic or community) interests. Finally, the political objectives can be either material (selective tangible benefits), purposive (nonselective tangible benefits), or symbolic (nontangible benefits).’’ (Ibid, p.365).
There a five different modes of governance (Ibid, p. 365-7). The clientelist mode of governance forms around personalized and particularistic exchange relationships between politicians and favoured interests or clients. The corporatist mode of governance predisposes government and private sector elites to seek a consensus on governing tasks and tends to lead to the formation of exclusive ruling coalitions of powerful economic and/or community interests. Entrepreneurial governance with public-private partnerships can be considered as corporatist. Managerial modes of governance are characterized by authoritative decisions by government officials, rather than pragmatism or consensus building. As has been discussed above, it is welfare-oriented, rather than entrepreneurial. In pluralist governance, there is a high degree of competition among contending interests. The chief concern is conflict management. Populist modes of governance emerge where politicians are inclined to resort to grassroots mobilization as a way of setting and implementing policy agendas. It should be stressed that these modes of governance are ideal types in the Weberian sense. In practice, one is likely to find elements of multiple modes of governance. Taking into consideration the entrepreneurialization as observed by urban governance scholars, we should expect to find a shift from managerial to corporatist modes of governance.
13 Table 1. Modes of governance
Clientelist Corporatist Managerial Pluralist Populist
Governing relations Particularistic, personalized exchange Exclusionary negotiation Formal, bureaucratic or contractual Brokering or mediating among competing interests Inclusive negotiation Governing logic Reciprocity Consensus building Authoritative decision making Conflict management Mobilization of popular support Key decision makers Politicians and clients Politicians and powerful civic leaders Politicians and civil servants Politicians and organized interests Politicians and community movement leaders Political objectives
Material Purposeful Purposeful Material Symbolic (DiGaetano & Strom, 2003, p. 366, modifications by author)
1.3 The governance of shrinkage
Bernt (2009) argued that urban governance has mostly been studied in economically prosperous locations, whereas only little attention has been paid to urban governance in the context of shrinkage. This topic deserves scholarly attention, because governance systems in shrinking cities experience different challenges than those in growing cities. After an early case study of Leipzig (Bontje 2004), Bernt’s study of Eastern German shrinking cities generated more attention for the issue. An especially important source is the EU-funded Shrink Smart project (2009-2012). This international project studied the role of policies and governance systems in different types of urban shrinking regions, based on seven comparative case studies throughout Europe. Three of their cases are Western European cities (Genoa, Liverpool and Leipzig / Halle), whereas the other four are located in Eastern Europe (Ostrava, Bytom / Sosnowiec, Timisoara, and Donetsk).1
These authors have focused on the governance of housing. The literature indicates that shrinkage generally has rather direct consequences for the local governance systems. The main challenge lies in the organization of a restructuring of the housing stock. This means adapting the existing stock to needs of a changed market. The decreasing demand for housing leads to structural vacancies in the least attractive housing environments. This causes pauperization of entire districts and an overall declining value. Demolition works and refurbishments are necessary to restore the market equilibrium and prevent negative spill-over-effects into other fields. However, shrinkage places
1 In this respect, Leipzig and Halle are special cases. These cities were part of the former East German socialist
republic and underwent a transformation to a capitalist system. They integrated into the German Federal Republic governance system. They are therefore currently considered as Western European cities.
14 an additional set of constraints on urban governance systems. Below, I identify the main theoretical claims on the governance of shrinkage.
Fiscal gap
In most cases, there is a multi-layered approach to the housing issues in shrinking cities. Even though the nature of the multi-level constellations differs per case, local governments are generally the central actors in the governance of shrinkage, providing a key link between institutions and layers of government (Rink et al. 2011, p.17). Their capacities are constrained by a structural lack of funds, also called a ‘fiscal gap’ (Rink et al. 2009, p.20). The municipal revenues drop because population loss leads to a decreasing taxing capacity. Furthermore, central state allocations do not (fully) compensate for population losses. In many countries, funds are allocated on the basis of population figures. Therefore, cities that lose population lose revenues as well. At the same time, many public service costs are irreducible despite decreasing population figures. Operation costs of the technical infrastructure often increase if it is not used to full capacity (Mäding 2004). Furthermore, shrinking cities often have higher social expenditures, because they have relatively larger shares of economically vulnerable residents (Ibid). The fiscal gap is a main problem for shrinking cities that rather strongly influences local governance relations.
Entrepreneurial governance
Many of the cases have been subjected to neoliberal state reforms, such as the devolution of responsibilities to lower tiers of governments and cutbacks in public financing. The Shrink Smart-authors observed that these can be highly problematic for shrinking cities. It requires local governments to assume an active role in development projects (Rink et al, 2011, p.27). Initial investments by the local government are needed in order to trigger the flow of private capital. This often demands more capital than the governments, experiencing the fiscal gap, can afford. Because private parties are often reluctant to invest in shrinking regions, there is a structural lack of locally raised funds.
The Shrink Smart-authors have observed that some shrinking cities engage in entrepreneurial pro-growth policies: ‘’In many cases there is evidence of a move from Keynesian to more neoliberal approaches to solving the housing consequences of shrinkage. Typically this takes the form of using housing policy to support local competitiveness and economic growth and using both private and public resources to achieve this aim.’’ (Rink et al. 2011, p.17). There are generally two ways in which housing policies contribute to growth (Ibid, p. 13). Firstly, the construction activities are themselves economic activities with significant multiplier effects across the local economy. Local governments and businesses both benefit from these activities. Secondly, housing policy can be used to stimulate
in-15 migration. Similar responses have been observed by Bontje (2004). In the 1990’s, local authorities in Leipzig stimulated new construction sites despite heavy population losses. These construction projects in the urban fringe only worsened the problem of vacancies in the city centre. Bernt’s (2009) study of East German shrinking cities produced different results. Here, local governments engage in public-private partnerships as well, but these partnerships did not necessarily take the form of entrepreneurially driven ‘growth machines’. Rather, their agendas were dominated by the theme of ‘coping with shrinkage’. Growth-related policies were complemented by other modes of governance:
Thus, for the cities under discussion, it is uncertain, metaphorically speaking, whether the train called ‘neoliberal governance’ will ever arrive at a station called
‘entrepreneurial city’, or end up at a ‘crisis of crisis management’ with unstable institutional arrangements, inefficient regulations and dysfunctional spaces.
(Bernt 2009, p.766)
Grant coalitions and dependency
In all cases, authors observed an increased reliance on external funds. Bernt found that the local government, the housing market, locally based businesses and infrastructure providers all suffer from shrinkage. As a consequence, these parties tend to form coalitions aimed at obtaining funds from higher tiers of government (mostly national level or EU). These public-private partnerships take the form of ‘grant coalitions’, bargaining over the bill paid by someone else (Bernt 2009, p.765). In Eastern Germany, the grant coalitions emerged in response to Stadtumbau Ost, a 2.5 billion Euro national program aimed at regaining a housing market equilibrium through demolitions (Ibid, p. 763). The planning agendas of these partnerships were dominated by the theme of ‘coping with decline’, rather than by economic growth. Couch and Cocks have observed the existence of grant-coalitions in Liverpool as well, where they emerged in response to the Housing Market Renewal (HMR) program, that ran from 2002 until 2011. It aimed to rebalance the housing market in the North and Midlands of England through new construction, refurbishments and demolitions (Cocks & Couch 2012, p.297).
The authors agree that grant-coalitions are not necessarily suited to deliver satisfactory policy results. The Shrink Smart-authors state:
In ‘bending’ the real issues to fit the requirements of external funding sources, or omitting some issues all‐together because funding is unavailable to address them,
governance strategies are not able to perform the comprehensive solutions they would be able to with sufficient locally raised funding at their disposal (Rink et al.
2011, pp.6–7).
Grant-coalitions design policies around funds, rather than around problems. A similar lack of comprehensiveness has been observed in Leipzig, where polices were exclusively concerned with housing and spatial development, while strategies to improve the city’s economic situation were
16 absent (Bontje, 2004, p. 19). Moreover, the provision of external funds is always tied to terms and conditions. Therefore, Bernt argues, they do not enhance the manoeuvring space of the local actors (Bernt 2009, pp.762–3). Instead, they reinforce the capacities of supra-local actors to influence local policy. Couch and Cocks observed a different dynamic in Liverpool. Here, the local authorities retained a central role in the governance of the HMR program that was initiated and funded by the national government (Cocks & Couch 2012, p.297). The national government was the most powerful in broader strategic issues, and steered the local authorities’ ability to respond to the consequences of shrinkage. Lastly, the partnerships provide little stability for the local partners themselves. They draw their agendas from funding conditions, lack resources and are spatially fragmented (Bernt 2009, p.765). For these three reasons, grant-coalition parties experience difficulties in producing a comprehensive and stable long-term shrinkage policy.
Dependency on external funds makes the policies especially vulnerable to macro-political and -economic changes. Cocks and Couch observed how the British national government started cutting budgets as a response to the economic crisis of 2008. The HMR program was terminated in 2011, seven years ahead of schedule, causing serious problems for the continuation of housing renewal in Liverpool (Cocks & Couch 2012, p.294). As the research on the Liverpool case study was published only one year later, the long-term consequences of the premature termination remain unclear. A main conclusion is that a shrinkage policy that is too dependent on supra-local actors lacks stability and consistency.
In Genoa, there was no large-scale financial aid by the national government. The lack of public funding was a characterising trait of the governance of the housing market (Bini et al. 2011, p.37). The city faced two main challenges: the regeneration of the historic city centre and meeting an increasing demand of social housing. Private investments played an important role in the regeneration projects. Moreover, the local government became active in procuring funds for small-scale projects (Ibid, p. 35). These were provided by various sources: the region, the national government and the EU. Due to the small scale of these projects and the temporary nature of the funding, a ‘’patchwork regeneration’’ emerged, in which improved areas exist alongside relatively serious pockets of urban decline (Ibid, p. 40). As each individual plan needs to be worked out in detail before getting approval by bureaucratic institutions, the regeneration as a whole has slowed down. The authors write: ‘’This fact [the lack of resources transferred from the central state] is not easily overcome by the capability of the local government or by a strong leadership. The space between the tasks to reach and the lacking of resources are ultimately creating tensions in the way governance has been set until now.’’ (Ibid, p. 43).
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New programs and agencies
Throughout their cases, the Shrink Smart authors observe how shrinkage spurs the adaption of existing institutions and the establishment of new agencies and new policies (Rink et al. 2011, p.15). In England, a variety of agencies and policies was established to deal with shrinkage. In Germany, in addition to the national policy of Stadtumbau Ost, local governments set up an Internationale Bau Ausstellung (IBA, or: International Building Exhibition) (Ibid). IBA was originally introduced in Germany in the early 20th century to showcase the latest trends in construction, but slowly moved to ambitious urban and regional restructuring incentives, projects and programs. The aim of the IBA is to stimulate projects that contribute to the urban or regional development. In Bytom (Poland), dissatisfied citizens expressed their opinion through the private venture of a website called www.ruinybytom.pl (ruins of Bytom), in response to the inaction of the local government (Rink et al. 2011, p.16). The authors do not come to a judgment on how these new institutions and policies impact on the abilities to cope with shrinkage. They do observe that both the existing and the new institutions are dependent on external funds.
Modes of governance
Most of the Shrink Smart cases show either corporatist or managerial modes of governance. The key feature of corporatist governance is that non-governmental parties are involved in strategic issues and in decision making, rather than being relegated to administrative or supporting roles (DiGaetano & Strom 2003, p.383). In a corporatist shrinking city, local public officials and private stakeholders closely collaborate in working on a problem caused by shrinkage. Evidence of corporatism was found in Leipzig and Halle (Rink et al. 2011, p.28) and in Liverpool (Cocks & Couch 2012, p.296). Here, the public-private partnerships took the form of grant machines. In the Eastern European cases, the systemic transformation to capitalism has resulted in incomparably weak state capacities and has given rise to what is termed as ‘’empty institutions’’ (Rink et al. 2011, p.27). Local governments hardly find any state support and are left to deal with the problems alone. In these cases, policies have a highly neoliberal character and are focused strongly on generating private investments. By aiming to stimulate economic growth, they address the causes of shrinkage. Public officials hope that this will have positive spill-over effects into other areas. In some occasions, this leads to ‘boosterist’ corporatist networks in which strategic decisions are made by a handful of politicians and business leaders, as is the case in Sosnowiec (Poland) and Donetsk (Ukraine) (Ibid, p. 27, 29). In other instances, local governments are left without support from public or private organizations, as is the case in Bytom (Poland). Here, governance remained a managerial, state-run affair with few prospects of seriously dealing with shrinkage. In Bytom, the lack of finance was a fundamental problem:
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It seems that this factor is the cause of a majority of tensions between the specific actors of social and economic life. The limitations of financial means leads to frustration, disappointment, irritation, disenchantment and action below the
expected consensus (Krzysztofik et al. 2011, p.86)
Conclusions
Whereas the field of the governance of shrinkage is relatively new, studies have produced interesting results. These cases show that many shrinking cities do not become entrepreneurial cities. The provision of external funds – public or private - strongly influences local governance arrangements as well as capacities to cope with shrinkage. The case of Parkstad is a unlike other Western European cases, because, in comparison, it has received only little external funds. In this regard, it is similar to Bytom, where governance remained managerial. The results in Bytom, however, have partly been shaped by the ‘empty institutions’ that resulted from the collapse of the political system. It is unclear to what extent similar responses will found in a Western European case.
Concerning the effectivity of the governance of shrinkage, each approach thus far has certain flaws. Authors have established that managerial governance in the context of an absence of funds does not work, whereas corporatist governance with funding from third parties is dependent, incoherent and vulnerable. The incremental approach in Genoa was slow and its results were incoherent, whilst ‘boosterist’ networks are dependent on private capital are too narrowly focused on economic growth. Cocks and Couch reported that the local authorities in Liverpool retained a central role in the governance of the nationally funded Housing Market Renewal (HRM) policy. They have identified the continuous involvement of the local authorities and other local parties as a source of stability within the program. This was a fruitful approach until budget cuts necessitated the termination of the program. It seems as if programs with external funding that leave day-to-day governance to local parties are, in spite of their shortcomings, the best way forward, as they lead to an ‘enormous increase of capacities to act’ (Rink et al. 2011, p.11).
Scholars have focused on shrinking cities. One the aims of this study is to assess to what extent their theoretical claims hold in a shrinking region, that has a more diffuse institutional context and has received only little external funding.
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2. Methods
2.1 Methodology
The term methodology refers to the applied philosophical positions that underpin and inform tools and techniques for carrying out research: the ontological and epistemological infrastructure that forms the groundwork for a research question (Haverland & Yanow 2012, p.401). This research is founded on critical realist methodology. Critical realism distinguishes between the world and our experience of it (Sayer 2000, p.11). It differs from interpretivism because it beliefs that there exists a reality out there that is independent from our knowledge of it (Ibid, p. 2). It differs from positivism because it acknowledges that social phenomena are intrinsically meaningful (Bryman 2012, p.28). Meaning needs to be understood, and hence, there is always an interpretive element in social sciences (Sayer 2000, p.17). For critical realists, causation is not understood as law-like regularities. Context and regularities both influence effects of causation. In the ‘open systems’ of the social world, the same causal power can produce different outcomes in different cases. Proving causation depends on identifying causal mechanisms and how they work, and discovering if they have been activated and under what conditions (Ibid, p. 14).
Social systems are always open and messy. We cannot isolate out certain elements and examine them under controlled conditions. Instead, there are multiple possible causes in the things we study. We have to be sure not to misattribute causal responsibility (Ibid, p. 20). To do this requires a research design which is geared to identifying such possibilities. That is why this research combines inductive (theory building) and deductive (theory testing) elements. It is inductive in the sense that it is open to identifying new causal mechanisms. It starts with a thorough analysis of governance responses to shrinkage in Parkstad. This leads to rich in-depth knowledge of the case and theoretical claims on the governance of shrinking regions. It is deductive in the sense that it uses these findings to explore the scope of theoretical claims derived from other studies: are they verified by a case with a more diffuse institutional character and no external funding? As the theories are probabilistic rather than deterministic by nature, they cannot be falsified on the basis of the results of a single case study. However, I will reflect on the theoretical implications of possible disparities between predictions and observations. This will lead to refinements of the theories and insights into the conditions under which causal effects do or do not take place.
2.2 Research design
The current body of knowledge on the governance of shrinkage has emerged from case studies (Bontje 2004; Cocks & Couch 2012; Bernt 2009; Rink et al. 2011). A case study is an intensive study of a single unit for the purpose of understanding a larger class of (similar) units (Gerring 2004, p.342). Case studies
20 are especially strong in identifying causal mechanisms and rich, in-depth analysis. As Gerring states: ‘’The identification of causal mechanisms happens when one puts together general knowledge of the world with empirical knowledge of how X and Y interrelate.’’ (Gerring 2004, p.348). For this reason, I have opted for doing a case study. It is a single-case study. The unit of analysis is the region Parkstad Limburg. This study aims to identify new variables, hypotheses, causal mechanisms and causal paths, by thoroughly assessing how shrinkage is governed in this single case. Accordingly, it can be labelled as a heuristic case study (George & Bennett 2005, p.75).
The research focuses on the changes in the governance system that occurred in the period 2015-2017, in the aftermath of macro-political changes that strongly shape local governance arrangements. As has been stated in the introduction, the Dutch welfare- and social care system has been structurally reformed in 2015. The government amended the Law on Societal Support WMO. It transferred responsibilities from the national to the local level of governance and led to an increasing demand for care-suited housing. Parkstad has experienced many difficulties in dealing with these changes. Realizing sufficient qualitative care-suited housing is currently one of the most urgent problems on Parkstad’s housing market. The consequences of the care reforms bring together many shrinkage-related issues; ageing, vacancies, a shortage of funds and unintended side-effects of national policies. The WMO-issues are, in essence, exemplary of the problems of a shrinking region. The research will focus on the governance arrangements around this issue.
The period under study is a transition period, in which the foundation is laid for future arrangements of governance. Previous authors have studied their cases over longer periods of time. Some have assessed more than a decade of governance. Because of the time span and resources available for this research, I have opted for studying a shorter period. Due to the path-dependent nature of governance, many developments from before 2015 are important for understanding current governance arrangements. They will be discussed where relevant. However, I do not aspire to make general claims about the governance of Parkstad before 2015.
2.3 Sampling
The research that inspired me was done in an urban setting. As most shrinking areas in the Netherlands are rural areas, the population from which to sample is particularly small (Gerring 2004, p.342). I theoretically sampled the region Parkstad Limburg (Bryman 2012, p.418). I consider Parkstad Limburg as an extreme case for the governance of shrinkage, because I expect that the diffuse institutional character and the lack of funds will be an impediment for effective governance. Extreme cases display extreme or unusual values on either the X (in this case: shrinkage) or the Y (governance) (Seawright & Gerring, 2008, p. 301). Extreme cases are typically low on representativeness. The extreme case
21 method is an exploratory method that aims to identify variation among the population, rather than similarities. Parkstad can be considered as an extreme case when compared to previous cases, but it is potentially representative for a larger class of shrinking regions that face similar coordination-problems as well as a class of shrinking areas – cities or regions – that face a lack of funds.
In order to make the subject researchable, a policy field needed to be sampled. As has been explained above, I have purposively sampled the field of housing, because this field is rather directly influenced by demographic developments (Bryman 2012, p.418). This choice is in line with the choices of the abovementioned scholars who studied the governance of shrinkage. Opting for the same policy field as preceding authors will allow for comparison between results. As the fields of housing and care are highly intertwined in Parkstad, I investigate developments in the field of care as well. Nonetheless, I am chiefly interested in housing. I incorporate those developments in the field of care that affect the housing market. This choice does have an impact on the results of this study. Because of the resourcefulness and relative independence of housing corporations, I expect to find that these parties bargain with local governments on a more or less equal footing. So, we are more likely to find corporatist modes of governance, than would be the case in a study of, for example, education policies. Lastly, respondents have been sampled through the snowball-method. This means asking respondents for suggestions for other respondents.
2.4 Operationalisation
The research has been framed around a number of themes. For each theme a sub-question has been formulated. The first four sub-questions focus on Parkstad specifically. They elaborate on the case, on the issue of housing and care and on governance arrangements around that issue. The fifth question is concerned with comparing the governance responses to those of previous cases and addresses issues of effectivity. The research question is:
How does Parkstad Limburg’s governance system respond to the effects of shrinkage in the field of housing?
1. Case description
What are the causes and consequences of shrinkage in Parkstad?
For understanding the problems that the region is currently facing, the identification of the pathways that contributed to this situation is crucial. This part places the current situation into a historical context. It discusses economic and demographic changes and addresses relevant policy reactions.
22 2. The core issue
What impact does the transformation of the care system have on Parkstad’s housing market? In this paragraph, I will explore the issue that is central to this research: the impact of the care reforms on the housing market.
3. Actors and institutions
Which actors and institutions are involved in the process of policymaking?
This section identifies the parties that constitute the governance network, as well as their stake in the issue. Knowledge of the involved parties is essential for understanding the governance arrangements, not in the least because many parties are going through transitions in their own field. These shape their capacities to contribute to the issue of housing and care.
4. Interactions
What is the nature of the interactions between these actors?
An analysis of the interactions between the main parties is an important step to grasp governance arrangements, because it helps to answer the question to what extent local governments rely on external parties for policymaking and implementation. The analysis of the main interactions forms the foundation for further reflections on the case and the theories. I will analyse the interactions by focusing on four themes:
• The issues for which interactions take place • Involved parties
• Intensity
• Is there trust, or are there competing interests?
5. Parkstad’s governance reconsidered
How do Parkstad’s governance responses compare to previously studied cases, and what impact do they have on the abilities to cope with shrinkage?
With the term ‘governance responses’, I refer to all those actions by actors involved in the issue of housing and care that can be considered as a response to this issue. This includes policymaking, as well as, for example, bargaining and searching for funds. This section is concerned with comparing my research results to those of other cases. I will discuss whether or not I have found evidence of the following issues:
• A fiscal gap
23 • Dependency
• New programs and agencies • Modes of governance
I will reflect on the theoretical implications of my findings. Moreover, I will come to a judgment on the effectivity of Parkstad’s governance responses.
2.5 Methods of data collection and analysis
The analysis is based on interviews and documents. The document analysis involved publications of interest groups and consultants, governmental publications, policy documents and academic literature. The aim of the document analysis is to get access to official information that can be tied to specific actors. This will provide information on which actors are involved, with whom they collaborate and what their problem perceptions and policy preferences are. Most of these documents have been found online, but I have also received documents from my respondents. Additionally, I have conducted semi-structured interviews with experts. The aim of the interviews is to get access to the world as experienced by locally embedded actors. This will lead to information on informal arrangements and the specific nature of interactions that are typically absent from official reports. Respondents have been selected based on the knowledge and experience they have in the governance of shrinkage in Parkstad. They include representatives of the province Limburg (2), the city region (1), a local governments (1), a care company (1) and a housing corporations (1). For reasons of privacy, I have not revealed respondents’ names, but their identities are known with my supervisor. All interviews have been recorded with prior consent of the respondents. The interviews have been conducted in Dutch. Quotes have been translated to English by the author.
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3. Analysis
3.1 Case description
What are the causes and consequences of shrinkage in Parkstad?
Because the governance of shrinkage is highly path-dependent, knowledge of the case is essential to understand the pathways that have contribute to the current situation. In this paragraph, I will explain how Parkstad has been affected by economic and demographic decline. It faces structural population decline since 1997, but appropriate housing policy responses did not materialize until 2006. In this year, municipalities intensified regional cooperation through the establishment of a city region.
Parkstad Limburg is a sub-region in the southeast of the Netherlands, on the German border. It is located in the region South-Limburg, in the province of Limburg (see figures 1 and 2). The name ‘Parkstad’ has been given to the region only recently, it was formerly known as the ‘Eastern Mining Area’ (Oostelijke Mijnstreek) (Latten & Musterd 2009, p.17). The new name has resulted from efforts to intensify inter-local cooperation and to create a new identity, that detracts from the mining history and stresses the green and open character of the area. It comprises eight municipalities. Four of these are urbanized (Heerlen, Kerkrade, Landgraaf and Brunssum), and the other four are rural municipalities (Nuth, Simpelveld, Onderbanken and Voerendaal). The city region, which was established in 2006, also carries the name of Parkstad, so this name is used for both the territory and the administrative organization. The local governments have committed to inter-local cooperation and have transferred policy-making authorities to the regional level. The city region is a key actor that will be discussed more extensively.
Mining history
Parkstad has predominantly been agricultural until around 1900, when it underwent structural economic changes. The rise of the coal mining industry introduced an era of economic growth and prosperity. Several large mines were opened, and the demand for mine workers attracted many new residents. These were accommodated in villages constructed around the mines. These grew rapidly and the region transformed into an urbanized, industrial area. Many of the new residents lived in Heerlen and Kerkrade, the heart of the mining industry (Latten & Musterd 2009, p.17). The period of economic growth came to an abrupt end when the coal mines were closed in the period 1966-74. Because oil and gas had become the main sources of energy, there was less demand for coal and the mines were no longer profitable (Elzerman & Bontje 2015, p.93). The mine closures had disastrous consequences: an enormous loss of employment and the loss of the mining identity. The region was left with 45,000 unemployed (Ibid).
25 The socio-economic problems that emerged after the closure of the mines were unprecedented and large-scale. Politicians and policymakers did not have ready answers (Ecorys 2015, p.17). The national government aimed to create employment by relocating governmental agencies (ABP, CBS, Ministry of Defence) to the region and by stimulating businesses with subsidies. This surely brought jobs. However, authors report on a mismatch between white-collar employment and the blue-collar workforce (Elzerman & Bontje 2015, p.93). Moreover, a large share of the new employment depended on state subsidies. This meant that many of the new jobs disappeared when the subsidies were terminated. The problem of large-scale unemployment remained unresolved. Several authors mention a lack of local entrepreneurship as an additional cause of slow economic progress (Elzerman & Bontje 2015, p.93; Ecorys 2015, p.13). The history of large-scale industrial employers with job-security and a familiar pattern of demands and expectations contributed to the emergence of a ‘wait-and-see’ mentality. The subsequent national state support has not really stimulated a breakthrough of this pattern.
The region’s geographic location is another important factor in the stagnating regional development (Elzerman & Bontje 2015, p.94). Parkstad is a peripheral border region that is located relatively far away from the Randstad, which is the economic core of the Netherlands. In Parkstad, the policymakers of the national government find little potential to contribute to the economic development and international competitiveness of the Randstad, which is the country’s economic centre and is the focus of its economic policies (Ibid). As a consequence, Parkstad is far away from the core decision making authorities, both in a geographical and a political way.
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Image 1. Parkstad Limburg in The Netherlands
Image 2. Parkstad in South-Limburg
Demographic change
The economic decline of the region spurred out-migration. The first signs of a demographic transition can be observed as early as the 1960’s. Many young people left the region in search of employment.
27 As this coincided with an increasing life expectancy, Parkstad observed a remarkable ageing and dejuvenation of its population when compared to Dutch standards (Latten & Musterd 2009, p.18). The total population figures fluctuated for two more decades until the 1990’s, when demographic decline became a structural phenomenon (see Table 2). Parkstad has negative rates on all three population developments – natural increase, national migration and international migration (Ibid, p.18). However, the low birth rates and high death rates (natural decrease) are the main cause of demographic decline in Parkstad (Ibid, p. 37) (see Table 3).
Table 2. Population development Parkstad Limburg
Year 1997 2016 2050 (expected)
Residents 272,000 246,000 184,000
Decrease in % with respect to peak year 1997
x 9,5% 32%
Sources: (Derks 2016, p.8; Neimed 2016; Parkstad Limburg 2017)
Table 3. Demographic figures: sub-region compared to province and country. The Netherlands Province Limburg Parkstad Limburg Total population
development in % (2000-2016)
2,4 -2,2 -8,6
Fertility rate (number of births per 1,000 inhabitants, 2015) 10,1 7,8 7,5 Share of elderly (65+) compared to total (2016) 18,2 21,8 22,8
Sources: (Parkstad Limburg 2017; CBS 2017)
Table 3 indicates that Parkstad’s population development shows unusual values when compared to the country and the province. The Dutch population as a whole is changing. Its growth is expected to halt in 2044, and its share of elderly will increase to 26% by 2040 (Van Duin & Stoeldraijer 2014, pp.2– 3). Within the country, significant intra-regional differences can be observed. Some regions will keep growing for decades, other regions are already facing demographic decline. Parkstad will have 35,4% of elderly by 2040 (Neimed 2016). Household decline is less pronounced on the regional level, due to household fragmentation (Parkstadmonitor). However, starting from 2020, a sharp decrease in the number of households is expected (Rosenberg et al. 2010, p.2). On the local level, some municipalities do face household decline. This occurs first and foremost in the municipalities of Heerlen, Kerkrade and Landgraaf (Latten & Musterd 2009, p.38). Heerlen, Parkstad’s largest city, is expected to see a 21% decrease over the period 2014-2050 (Progneff 2015, p.29). Household decline leads to vacancies and an overall declining housing value. These problems are most pronounced in the least attractive living
28 areas in Heerlen and Kerkrade, in the old working-class areas (Latten & Musterd 2009, p.39). An additional problem is that those households who cannot afford to move remain behind in these unattractive areas, leading to pauperization and a concentration of disadvantaged groups.
The economically driven out-migration spurs social segregation on the regional scale. Typically, the younger and higher-educated people are more inclined to leave the region, looking for education at the university level or for high-skilled jobs (Elzerman & Bontje 2015, p.94). This leaves the region with a decreasing potential for the labour force, making it less attractive for employers. Furthermore, it leaves behind a population with a lower socio-economic status (lower educated, lower incomes) (CMO 2013). On average, people with a lower socio-economic status experience more interrelated socio-economic problems such as poverty, bad health, indebtedness and addictions (Verweij & Lucht 2014). Residents of Parkstad Limburg are less healthy than the average resident of Limburg (Ibid, p.25). This ‘health gap’ is for a large part related to the high concentration of welfare recipients and disabled people in the region. Summarizing the above, Parkstad faces the effects of the mutually reinforcing processes of economic and demographic decline. The population is ageing and dejuvenating rapidly and contains relatively high amounts of economically vulnerable groups.
Demographic decline as non-issue
The economic decline of the region has not gone unnoticed. Parkstad has been subject to various policy programs. The national government assumed an active role in the economic restructuring of the region in the period from the mine closures until 1990 (Ecorys 2015, p.26). In the 1990’s, the region received funding through the European Structural Funds (ERDF and ESF). These funds dominated the policies in Zuid-Limburg in the 1990’s (Ibid, p.31). Both the national and the European funds aimed at reinforcing the economies of de-industrialized cities. Recently, the province of Limburg asked research agency Ecorys to investigate the social policies in Parkstad since the mine closures. Ecorys concluded that the national government and EU policies have only been partially successful (Ecorys 2015, p.5). A main problem is that the policies did not match with the regional specific situation and qualities. Some progress has been made, but it has been judged as insufficient to fully resolve the region’s problems. A new ‘economic engine’ has not yet been created.
Whereas economic and social problems were at least on the policy agenda, less attention was being paid to the demographic aspects of decline, and to the question what this implicates for the housing market. The changing demand leads to a mismatch between the demand and supply for housing: a ‘housing mismatch’. A structural decline of population and households should be responded to by restructuring the supply of housing. Peter Hovens, one of the agenda-setters on the topic of shrinkage, wrote that, while demographic decline started in 1997, this topic remained absent from the
29 local political agendas in Parkstad for another decade (Hovens 2016, p.14). Quite the opposite, policymakers encouraged new construction projects, because these generated tax incomes. It actually took until 2006 before demographic decline was recognized as a structural problem. In this year, Derks et al. (2006) published a report in which they warned that many Dutch regions will face population and household losses in the near future. This report had a strong agenda-setting influence in Dutch policymaking (Haartsen & Venhorst 2010, p.218).
In this period, shrinkage appeared on both the national and the local policy agendas. In 2009, the national government developed a national shrinkage strategy and formed a Top Team Krimp. This team consisted of two former politicians, who visited three shrinking regions to explore the policy needs (Elzerman & Bontje 2015, p.91). This eventually led to an inter-administrative action plan, Krimpen met kwaliteit. This was a collaborative effort between the Ministry for Internal Affairs (BZK), the Ministry for Housing, Spatial Planning and Environment (VROM), the inter-provincial consultation (IPO) and the association of municipalities (VNG) (Rijksoverheid, IPO & VNG 2009). The aim of the plan was to facilitate acceptance of shrinkage and to deal with its consequences. The local level is considered as the proper level to deal with shrinkage (Ibid, p. 5). The provinces facilitate cooperation between local governments, whereas the national level has the task of raising awareness for the issue and of facilitating knowledge-sharing (Ibid, pp. 23-4). A 2014 review of the action plan concludes that its main contributions lie in awareness-raising, agenda-setting, knowledge-sharing, facilitating experiments and the development of new policy instruments (Haartsen et al. 2014).
Dealing with shrinkage on the local and regional level
The literature on the governance of shrinkage has taught that regional (inter-local) cooperation is necessary, but is often difficult to achieve (Hospers 2012, p.19). Local governmental officials are, by nature, not inclined to work in the regional interest, because they are held accountable to local constituencies. Often, local sentiments play a role as well. This is especially the case in Parkstad. The mining settlements have always been mini-societies with their own social and cultural facilities. These social and cultural factors still manifest themselves in politics through high levels of chauvinism and strongly felt local identities (Elzerman & Bontje 2015, p.95). Several additional factors thwarted the realization of regional cooperation in Parkstad (Latten & Musterd 2009, p.44). The consequences of shrinkage are unequally distributed. Many of the problems are currently most pronounced in Kerkrade and Heerlen. The other municipalities therefore have less incentives to engage in collaboration. Furthermore, construction projects constitute an important source of income for local governments. They are therefore reluctant to reduce construction ambitions. Lastly, in the Netherlands, there is no institutional level between the municipalities and the provinces (the ‘regional gap’). Governmental bodies on the regional level – such as city regions and metropolitan areas - lack constitutional
30 anchorage and democratic legitimacy. There is an ‘institutional mismatch’ between the scale of the problem and the scale of the institutions dealing with them. These factors explain why it took so many years of decline before cooperation finally materialized. Parties acted for selfish reasons, even though they know that cooperation raises collective welfare.
The urgency of the problems eventually spurred regional cooperation in the form of a city region, that was granted authorities on issues of housing policy, spatial planning and mobility: ‘’The region Parkstad Limburg recognizes its enormous socio-economic task as well as the complexity of the issues it faces. Therefore, Parkstad, with support of the Province Limburg, has applied for the WGR+-status in 2005 and has been granted this in 2006.’’ 2 (Parkstad Limburg 2008). In WGR+-regions, local governments transferred policymaking authorities toward the regional level. In that same year, the first regional housing plan was designed (Parkstad Limburg 2006). This was the first attempt to scale down local construction ambitions. In 2009, the municipalities formed the Pact of Parkstad, with the intention of further cooperation based on a ‘strategical agenda’, which was concerned both with economic and spatial issues. In this period, the province was getting more actively involved and was actually one of the initiators of the strategic agenda and other initiatives (such as Limburg TransforMEERt) (Dijkstal & Mans 2009, p.27).
In 2014, the city region was institutionally remodelled. It now has an executive committee, consisting of eight mayors. It has policymaking authority on four themes;
• spatial planning • mobility
• economy and tourism • housing and restructuring
Each field is administered by a management committee that consists eight aldermen, who are eventually held accountable by the local councils (Parkstad Limburg 2014a). The committees are supported by a small team of public servants, that are funded by the local governments. Decisions made by the management committees directly impact on the local administration. Official policies, such as sub-regional housing visions, still need approval by local councils. The regional level is considered as most appropriate for making housing policy: ‘’The region Parkstad functions as one housing market. The residential areas overlap into each other to such an extent that municipal borders do not fit on the housing market.’’ (Gemeente Kerkrade & Parkstad Limburg 2016, p.9).
2 WGR+ stands for Wet Gemeenschappelijke Regeling Plus. This is a Dutch law on inter-municipal cooperation
