21/11/2011 Inside Out East

Hello. This week I'm in Luton in Bedfordshire. And this is what's

coming up on tonight's Inside Out. What happened to the �50 million

grant to improve the lives of Luton residents? They have no faith any

more. They've lost hope. They have no faith at all. They've been

promised so much in the past, and they've got nothing.

A former inspector reveals what went wrong with Southern Cross Care

Homes. And we see if the mountain bike

course in Essex is good enough for the Olympics. It's tough, it's fun,

it's fast. And I think it's going to be a really great show.

They're our three surprising stories where we live. On tonight's

The recent riots left many people wondering just what had happened to

our communities. And also how to make sure this kind of thing

doesn't happen again in the future. In the '90s, there were riots in

parts of Luton. And one of the solutions was to give �50 million

to improve the area. So, did it work? And how has the money been

spent? Nick Conrad has been investigating.

Marsh Farm in Luton. One of the most deprived areas in the UK.

Blighted by memories of rioting in the '90s. 10 years ago, it was

given a lifeline. And that lifeline came in the form of cash. �50

million to be exact. Paid over 10 years, it was regeneration money

from the Government. A new deal, designed to lift Marsh Farm out of

deprivation and create a lasting legacy. It's not a handout, it's a

deal. It's a partnership with the local community. The more you are

prepared to get involved, the more you are prepared to do, the more we

will be there helping you to help people help themselves locally.

a decade of cash injection came to an end earlier this year and the

future, well, it looks anything but right. -- bright. How let down do

people feel in Marsh Farm? Totally. Absolutely totally. Because they've

been promised so much in the past and they've got nothing. So, why is

there only a half empty building, a council-owned children's centre and

this scruffy piece of land to show It's a bright Wednesday morning in

November. The Pearly Shopping Centre right in the middle of Marsh

Farm. Minister Vic Cowl has lived in Marsh Farm for over a decade. He

remembers what it is like being told that area was getting �50

million of new deal money. Tremendous amount of excitement

because it was such a large sum. And it came out of the blue. When

we got it, people were like, at last, something. The poor offspring

of the town. People were so excited. When they could see what was

proposed that was going to happen, for this area, it was so

revolutionary. In 2001, residents were promised the Pearly Shopping

Centre would be replaced. I've got to be honest, it doesn't look like

it's had a multi-million pound facelift. Well, of course, it

hasn't. This is still the original. We are still waiting for it. There

is nothing new apart from the odd coat of paint. But that's it. This

is what it was originally. Apart from some paint on the inside,

which again was paid for, that's it. Nothing has changed. In fact, a lot

of promises were made. Promises which included the centre of Marsh

Farm being redeveloped, a new shopping centre, affordable houses.

A master plan costing �1 million was drawn up. But delays and

internal wranglings meant most of the plan never went ahead. But

there is something to show for the cash. One of the first things the

Marsh Farm Community Trust did is to buy an old factory for community

use. It cost �6 million to buy and refurbish. It was knocked down and

replaced with this, Futures House. At a cost of another �9 million. So

is this �15 million building project on which the entire future

of Marsh Farm's regeneration worth it? The idea is the building will

be able to generate enough money to be able to run itself as a

community hub and fund projects in Marsh Farm. It's supposed to be the

sustainable legacy of the �50 million grant. But is it

sustainable? One expert is not convinced. He looked at Marsh Farm

Futures Strategy as part of a government team which evaluated

regeneration spending in Luton. Do you think the Luton strategy has

been successful? No. It demonstrates a lack of forward

thinking. There is a lack of management, lack of planning. When

you look at the statistics, it doesn't show much resemblance to

any sort of desired outcome they would have had from the beginning.

The idea is rent generated from tenants in this building improves

the lives of people in Marsh Farm by running community project. --

projects. But it's less than half full. We did ask Marsh Farm Futures

Trust who run this place how much money they spent the past year on

projects for the community. But they wouldn't tell us. We also

wanted to do how much income they've received from tenants. But

they wouldn't tell us. And we also wanted to know how successful their

fundraising has been over the past year or so. But, guess what, they

wouldn't tell us. So, we found out anyway. According to the most

recent accounts, the income is half what was predicted. �342,000 for a

�15 million outlay. And there's no sign of any community-based project.

So what else is there to sustain a legacy of regeneration in Marsh

Farm? This. A rather attractive piece of land, was sold to Marsh

Farm Trust by Luton Borough Council in 2008 for a shade over �700,000.

�763,000, to be exact. And there are no firm plans for using it. For

anything at all. In fact, there's only one thing this land is allowed

to be used for and that is affordable housing. But there's no

money available and there's no developer waiting in the wings.

According to Crispian, this doesn't bode well for the future

regeneration in Marsh Farm. The big problem there is that they own a

piece of land at a time when there are no developers, there's no-one

willing to invest in housing because there is not any money.

You're probably thinking that about 30 million we haven't told you

about. Well, just over 5 million went on management and

administration. 5 million went into the pockets of consultants. And the

rest of the money, well, that went largely on community schemes, many

of which haven't continued. Back in Marsh Farm, I asked Vic to show me

some positive news. Well, this is the Redgrave Children and Young

People's Centre, which was a mercenary, basically. -- nursery.

This has been a tremendous success. And still is. And, of course, it

also acts almost as a feeder for the school. It's part and parcel of

the community. And I also came across Jackie. Her life was

transformed when she received an education bursary from the

regeneration money. It was amazing. It just opened up opportunities for

me. I learned things that I could never have learned. I have grown as

a person. In the second year of my degree, I got a new job, and if I

hadn't have done the course, I wouldn't have had the skills to be

able to get through the interview process. So it's made a huge

difference to me. So, which organisation is responsible for

making sure that every penny of the �15 million was wisely spent? Luton

Borough Council. The very same organisation which broke funding

rules as regeneration grants need to be funding solid regeneration

projects, not the purchase of a scruffy piece of land. They didn't

want to be interviewed, but they told us... All the transactions and

transfers were undertaken with the express permission of Government.

Marsh Farm Futures also didn't want to be interviewed, but they told

us... Money for community projects is ring-fenced, but it may not all

be spent this year as we are committed to working with our

partners in delivering programme activities, rather than just

spending money to tick boxes. They also told us that the 40% occupancy

of Futures House is a good start. But there's no doubt how Vic feels.

I am very, very disappointed. Because a lot of people tried hard

to improve it. But they got nowhere. And the people have just accepted

the attitude it doesn't matter who's in power, what they vote for,

what they propose, you'll get what you are given and like it. Do you

regenerate an area or do you regenerate people? People. It is

people are what make the area. It's about who is there, it's not about

building things and properties. It's about the people who are here.

And Marsh Farm is an amazing community as it is. I think with

the right sort of investment and if people feel that they are being

really heard, it could just be amazing.

Now, if there's something you think we should investigate on inside out,

Later, what went wrong at Southern Cross?

Now, Essex isn't exactly known for its mountains. The highest point is

actually 500 feet above sea level. -- less than. So how do you go

about building a mountain bike course when you haven't got any

mountains? Well, Sean Peel went to meet the people who were determined

to bring the Olympics to Essex. London 2012's Mission Improbable.

Make a mountain biking course in the flattest region of the country.

Make it close to the Olympic Park. And make it the best ever. After a

long search, they found 550 acres of Salvation Army land on the

Thames Estuary. Essex land guarded by the ruins of a 700-year-old

castle. Hadleigh Farm. After all the planning and the knock-backs,

these riders are about to find out The Hadleigh Farm International is

This is Formula One mountain biking style. History being made in Essex.

Some of the world's top riders are here from all the continents of the

world. Why? Because this is their first and last opportunity to check

out this course ahead of London 2012. It was the hottest day in

July for the official road test of the course by the same riders who

will be back for next year's games. The test was also a triumph of

belief and determination. Belief that the relative flatlands of the

East could be the home of Olympic It is raw, tough racing. It's

something that we managed to overcome those doubters who said

that you can't have a mountain bike race where there are no maintenance.

Well, we've proven that you can. Mountain biking at Hadleigh had a

difficult birth. The original choice was Weald Park near

Brentwood. Lord Coe and co rolled in to tell the world that Weald had

wheels. If it did, they soon fell off. In an embarrassing twist, the

International Cycling Federation said it was too flat. They have six

months to find an alternative. Six months during which the vultures

from the higher ground circled overhead. But Essex had the answer

and the answer was Hadleigh Farm. One of the technical challenges on

the course has been named the leap of faith. It could be said that

just thinking about staging mountain biking here could be just

that. I always knew it would be a big race success. Original it was

going to be in Brentwood. We were disappointed when that was felt to

be less challenging. But I grew up around Hadleigh, so I have known

this area all my life. I knew this area would be a fantastic venue.

There is a great view across the estuary. Not a leap of faith for me.

They are just blown away by it. it's ideal for spectators. On some

courses, riders disappear into the woods for long spells. But in this

natural bowl, 60% of the 5km course is laid out for all to see. After

the games, it will be adapted. Absolutely terrific advert for the

locality, I think. It may change a lot of peoples minds about the

perception of Essex may be. Sometimes you go to an event and if

it is a big race, you only see the section in front of where you are

standing. Because of all the hills. We can see the start, we can see

that drop, we can see that rabbit tunnel thing over there. I really

like watching the bikes go really fast. There may be no mountains,

but no matter. After eight laps, they'll have cycled the height of

Ben Nevis. There are climbs that will burn iron lungs and rocky

descents to break hearts and bones. World champions took part in this

test and they all agreed happily was hard to handle. -- Hadleigh was

hard to handle. Every course is different and that is what is

fantastic about the sport of mountain biking. There is always

new challenges, always new courses. I think it is tough, it is fun, it

is fast and I think it is going to be a really great show. I hope tons

of people come to watch the race It's difficult. It's difficult

technically and also physically. The only problem is it really

difficult to pass on the track. Most of the time you are on a

single track and it's really difficult to pass. But I was in

front today, so it was not a problem. It is never going to be as

hot as Sydney or Beijing, but the things here is it is exposed all

the way round. For Dan Jarvis, it was never in doubt. Now he's a

commentator. And he has to pinch and self when he sees the world's

top riders competing on his local park. This is the very first place

that I rode a mountain bike. There's a post down there. It's got

an imprint of my face on it. You could say that there is a part of

me always here in Hadleigh. But it is been amazing for me to see. When

I was riding here 25 years ago, there was no way I would of thought

that the Olympics would be here. Not only are they going to be

easier, but we've actually realistically got a claim for the

best Olympics course ever. The test event was to examine crucial

aspects of operations ahead of next year's games. Security was tight.

These former Gurkhas were brought Next year, there will be airport-

style checks. This is Tony Kavanagh, the venue manager. Today, he wants

to make sure everything works. Stewarding, communications,

catering, first aid, timing, transport, toilets. It's Tony's

world and he is making sure it turns. Touch temporary plastic

chair, it's all going well. We are going through basically a period

now called readiness. The test event is the culmination of

readiness. But we've actually been doing months and months of planning

before that for the test event. After this, we go into what we call

operation planning three. And that's all about providing for

contingencies. So what if it hadn't been gloriously sunny and we'd had

loads of rain? What if half the athletes say they don't like the

course any more? How are we going to handle that situation? So all of

the what ifs. We know we can do it. Now, hopefully by the end of today,

what happens if there are things putting our way that stop us doing

it. Because there's only one thing we have to do which is to deliver.

And that's what needs to happen next year. It's not just Tony who's

pleased. There are many others breathing a sigh of relief, not

least the organisers. The choice of Essex was called into question. And

that turned into incredulity when their first choice was turned down

and they still believed the only way was Essex. No one is coming

here and saying you need to make it harder. It makes me smile every

time I drive into Essex is and see the sign saying welcome to the 2012

mountain bike race. That is fantastic for the sport and I think

it is fantastic for Essex. We are very happy to be here and we think

we have found a new way for the sport, and new way to deliver the

sport and we have done that with Essex. So it's brilliant. There are

many who said it could never happen. Mountain biking in Essex. But it

can happen. It has. As we have witnessed today, you don't need

mountains to stage mountain biking. And you don't need mountains to

provide a course that will test the very best riders in the world. And

those riders will be back here again next year for the Olympic

games. But next time the whole world will be watching.

pressure! When care home operator Southern

Cross collapsed in the summer, thousands of residents were left

worrying about their care. 50 of the homes were here in our region.

But a handful of people made millions of pounds from the company.

So, did Southern Cross put profit For years, managers stayed quiet

about the company's problems. Now, in the wake of its collapse, the

real story is emerging. Jude Good managed five homes for Southern

Cross. It was a 60 bed unit and we only had one bath working for 60

residents. The requirement is to have one bath for every eight

residents. They knew that I had only one bath working and

continually failed to put the money in to get the baths going.

Relatives have told us it was their loved ones feeling the impact.

George Gilles's mum Kathleen lived in a Southern Cross home. She had

to go into hospital once. The hospital pointed out that she

hadn't been cleaned properly after she had been to the toilet. And

that apparently had been going on for a while. So what went wrong for

Southern Cross? Its beginnings were promising. It was set up by John

Morton in 1996. Within six years, he was running 140 homes. For

industry watches, it was a business of which could be proud. -- he

could. Within the industry, he had a reputation for being a very

honest man and also a very caring man. Most people who enter this

business do so because they have a desire to care for people. The big

businesses unfortunately have lost that along the way. But John was

certainly one of the early entrepreneurs who believed that

care was as important as profit. Seven years later, Mr Morton

decided it was time to move on. He sold Southern Cross for �80 million,

of which he netted 25 million. He told the BBC his company was

profitable and its level of care was considered exemplary. But he

didn't wish to be interviewed. The business was so attractive to

investors that Southern Cross changed hands several times and

hundreds of new homes were bought. In 2002, a management buyout backed

by a German bank saw ownership of Southern Cross change hands. They

changed the face of the business. When John Morton ran it, he ran it

as a care business. When the new investors came in, the equity

providers, they ran it as a business which regarded the clients

as simply factors of production. This is how it worked. Southern

Cross made a profit from selling many of the care home buildings as

property prices rose. It paid rent to the new owners. With the profit

from the sales, Southern Cross bought more homes but continued to

operate the care side of the business. It is known in the trade

as sale and lease back. And initially it seemed the sky was the

limit. In 2004, American private equity firm Blackstone owned by

billionaire Stephen Schwartzman bought Southern Cross for �165

million. Former directors Philip Scott and Graham Sizer remained

with the company. Southern Cross was a very profitable company. But

while the business was doing well, there were growing concerns.

Inspectors, patients and some Southern Cross staff were raising

questions about the quality of care of vulnerable elderly people. Kevin

Mansel was in charge of inspectors assessing care homes in East Anglia.

There were lots of individually very distressing failures. Obvious

signs this company wasn't well- managed, didn't invest. And yet

their reputation in terms of the market, if you want to call it that,

was unsurpassed. Other inspectors were equally concerned. We've

obtained these previously undisclosed reports which bring

together the concerns of inspectors from right across the country. In

effect, an annual health check on the Southern Cross empire. For

three years, the reports highlight the same problems. People who have

dementia were poorly served. This was also highlighted in the

previous report. While many care homes did meet the national minimum

standards, there were those where inadequate numbers of toilet and

bathroom facilities were available. Not all call bells were functioning.

Staff were carrying jugs of hot water to rooms. And one recurring

theme was very familiar to Kevin. We were aware of the chronic kind

of turnover in managers of homes way above anyone else. We were

aware of the sort of external support for homes. The manager is

one tier up also being very unstable. Just a lot of unhappiness

about the way the company was run. In November 2004, Southern Cross

bought care home owner NHP and became the UK's biggest private

care provider, running more than 500 homes. Inside Out wanted to

talk to the American company that was watching Southern Cross expand.

But no one from Blackstone would talk to us. In a statement, it

insisted that the company was acutely focused on quality of care

issues. And that any issues were immediately identified and

rectified as quickly as possible without regard to cost. The company

was well regarded by its customers and its regulator. And it insists

the sale and lease back model was in place before it came involved.

In 2006, the landlord side of the business was sold and Southern

Cross was floated on the stock market. Stephen Schwartzman and the

directers sold their shares at different times. Blackstone made a

reported �614 million at the time of flotation in July 2006. The

directors sold their shares in December 2007, making them

multimillionaires. Blackstone told us it did not profit from stripping

assets, but invested in and built a company that was viewed by the

market as an industry leader. In June 2008, the company issued a

profits warning, saying it had breached its banking covenants. Its

share price tumbled by 85%. The BBC approached the directors who had

done so well from the sale. A spokesman for the former chief

executive Philip Scott told us that when he left the occupancy was over

90%. This would not have been possible if residents and their

families did not think the business had the right ethos. A spokesman

denied the sale and lease back option Hadfield, seeing Southern

Cross had got into difficulties because Mr Scott's successors could

not pay the rent. -- saying. Mr Scott's spokesman said he sold his

shares as a result of changes in tax laws and he rebought shares at

a later date and lost money. The situation has not resulted in

wholesale home closures. Southern Cross shareholders have been the

ultimate losers, not the residents. One-time chairman William Colvin

and operations director for John Murphy refused to answer our

questions. Former financial director Graham Sizer told us that

care was paramount. Without that, there was no business. I don't deny

there would have been care issues at some homes. There will always be

issues in this type of business. He also said that the timing of

selling his shares was driven by government changes to capital gains

tax rules. Those shares were sold in December 2007. He still owns

300,000 shares today. Southern Cross, which looks after more than

30,000... Britain's biggest care home provider... Finally, this

summer, Southern Cross were forced to throw in the towel. After a

summer of anxiety for staff and 31,000 elderly residents, last week,

all but nine of the former Southern Cross homes were assigned to new

companies. Effectively marking the end of Southern Cross. They cared

about their profits. But they had forgotten that the very heart of it

is the residents. If we don't care about our residents, how can we

possibly have everything else that Well, that is it from Luton. I hope

you have enjoyed the programme. If you have missed any of it tonight,

you can catch it again on the eye player. -- iPlayer. I will see you

next week when I will be back with these surprising stories. The

people accused of theft or false accounting who say we have done

nothing wrong. And living with dementia. Bob used to make luxury