Thames Gateway regeneration risks

LONDON (Reuters) - The regeneration of the Thames Gateway risks becoming a public spending "calamity" because the government department responsible is unable to manage the project, an influential committee of MPs said on Thursday.

The Public Accounts Committee said in a report that the Department for Communities and Local Government risked failure over the ambitious project because of poor planning and a disjointed approach.

The Thames Gateway regeneration project -- the biggest such programme in western Europe -- is centred on the 40-mile area between Canary Warf in London and the mouth of the River Thames.

The government is planning 160,000 new homes and hopes for 180,000 new jobs by 2016, in a massive economic boost to the Southeast.

If successful, it could add 12 billion pounds a year to the economy.

However the committee's chairman, Edward Leigh, said: "It still amounts to little more than a group of disjointed projects which do not add up to a programme which is purposeful and moving forward."

The Conservative MP said the department was "at present manifestly not up to the job of managing the enormously ambitious enterprise of regenerating the Thames Gateway region."

"Action must now be taken to prevent the enterprise ending in another public spending calamity," he added.

Leigh said the department has yet to establish a proper budget, or set clear and co-ordinated objectives.

But the DCLG, headed by cabinet minister Hazel Blears, rejected the claims that they were ill-prepared.

"Following the recent spending review, we will shortly be publishing our delivery plan for the Gateway in which we will set out fully costed plans to continue regenerating the area," a spokesman said.

"We have clear targets to create 160,000 new homes and 180,000 new jobs by 2016. We are on course to meet, if not exceed, those targets -- that is what delivery is about.

"We simply do not recognise many of the suggestions in the report."

(Reporting by Johanna Leggatt; Editing by Steve Addison)