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Case Study Seven:

VILLAGE REGENERATION: KINLOCHLEVEN - A HIGHLAND VILLAGE REBORN

Stephen Booth

bulletBackground
bulletThe approach
bulletThe strategy
bulletImplementation and the Kinlochleven Land Development Trust
bulletLand transfers
bulletPhase I
bulletPhase II
bulletConclusions

Background

The village of Kinlochleven was established in the early part of the twentieth century when the then North British Aluminium Company built the Blackwater reservoir, hydro-electric plant and aluminium smelter. The smelter, Kinlochleven’s raison d’etre, transformed the shooting estates of Kinlochmore and Kinlochbeag into the thriving industrial village, which was to become Kinlochleven. Around the smelter a village was developed: housing was created by the Village Improvement Society, recreational facilities were provided, and schools and churches were built. With one of the largest aluminium smelters in the world at this time, powered by a plentiful supply of hydro-electricity, and strong international demand for the product, the village grew to its current size, with employment in the factory peaking at well over 700.

Aluminium is, however, an international commodity and as the century has progressed, so too has the aluminium industry and its smelting processes. Modern smelters are now producing around 250,000 tonnes of aluminium compared to the 8,000 tonnes produced in Kinlochleven. Economies of scale, increasing environmental controls, the growth in recycling and a downturn in world demand have, for the past 15 years, brought into question the viability of the Kinlochleven smelter and in turn the sustainability of the community built around it.

In 1994 Alcan Smelting and Power UK Ltd, the smelter’s current operators, indicated that the smelter would close towards the end of the century. However, the power station would continue to generate electricity, supplying the Lochaber smelter and selling surplus to the national grid.

Kinlochleven has a population of 1,077, who live in 426 households. 286 of the village houses are publicly owned (1991 Census). In January 1999 the smelter employed 96 staff and unemployment in the village stood at 7.54 per cent (Employment Service). Kinlochleven High School has a role of 180 and there are 82 children in the primary school. Kinlochleven has a post office, a bank which opens one day per week, four hotels and two bunkhouses, which provide accommodation for tourists - predominantly walkers on the West Highland Way.

The Approach

The announcement that the smelter would close, whilst not unexpected, stimulated the community and agencies to work together to secure a prosperous, vibrant future for the village.

In response the Lochaber Economic Forum, a local partnership of economic development agencies and the business community, set up the Kinlochleven Working Group to investigate potential opportunities and recommend regeneration proposals for the village. The Working Group was a broad church which included representatives from The Highland Council (originally Lochaber District and Highland Region); Lochaber Limited, the Local Enterprise Company (LEC); the Highlands of Scotland Tourist Board; Scottish Natural Heritage; the Employment Service; Kinlochleven Community Council; the Business Group; the Community Association; the voluntary sector; the Highlands and Islands Fire Brigade; and Lochaber Housing Association. The group also included representatives from Alcan Smelting and Power UK, and from the Alcan workforce.

The Strategy

In 1995, after extensive consultation with the community, the Kinlochleven Working Group announced a ten-point regeneration strategy for the village, including both short and long-term developments as follows:

  1. Decontamination of the former carbon factory site.
  2. Restoration of the listed buildings to provide space for a new interpretative centre and 8,000 square feet of new business space. Restoration of the laboratory building for a bunkhouse and camping site for West Highland Way walkers.
  3. Environmental improvements to the village (phase 1).
  4. Creation of a new "Hill-Walking and Mountaineering Interpretative Centre" within the existing carbon bunkers.
  5. Demolition of the shower block, gate house and boundary walls, and landscaping of public areas in Phase 2.
  6. Decontamination and partial demolition of the smelter works site. Repairs and restoration of powerhouse.
  7. Development of part of the smelter works to accommodate "The Aluminium Story", an interpretative display of the smelter’s history.
  8. Creation of the new mountain garden initiative embracing the smelter site and adjoining land. Phase 2 of environmental improvements to the village.
  9. Development of the village hall, the current Alcan Club and other community facilities and services.
  10. Development of the pier and adjoining land.

The total estimated cost, in 1995, of this village Economic Enhancement Strategy was 7,825,000. The Working Group was keen to see a phased development programme, in which projects could be implemented both immediately and over the timescale of the smelter clearance.

Implementation and The Kinlochleven Land Development Trust

Having devised a strategy, the Working Group had to focus upon the method by which projects could be delivered on behalf of the community. In developing a structure, the following issues had to be considered:

bulletAlcan’s Highland Estates is the largest landowner in the Highlands of Scotland and the third largest landowner in Scotland. The catchment area for the Blackwater reservoir alone is some 62 square miles. Alcan was prepared to hand over land to the community for economic development purposes, but required safeguards regarding its responsible management.
bulletNo community structures were in place with the ability or willingness to take over ownership and responsibility for the land, or to raise the required funding.
bulletDirect ownership of the land and building assets and their development was outwith the remit of the agencies involved.
bulletGiven that any structure created would be responsible for assembling a funding package close to 10 million pounds, it was important that such an organisation would have credibility with funding partners.
bulletIt was also necessary, because of the retrospective payment of most grant assistance, that the land organisation had either sufficient resources to bank roll projects or the credibility with financial institutions to arrange bridging finance and short-term overdraft facilities.
bulletAt the time, Alcan had indicated its intention to close the smelter during 1997.

Bearing all these issues in mind, the decision was made to establish the Kinlochleven Land Development Trust (KLDT) to implement the strategy. KLDT is a Company Limited By Guarantee without share capital and is recognised as a Scottish charity. KLDT was established in August 1996 and has a board of five Directors comprising two nominees from The Highland Council (including the local councillor), two nominees from Lochaber Limited (LEC Directors) and one member elected from the local community every three years.

Following the incorporation of KLDT, initial stages of the strategy were moved forward with the support of Lochaber Limited. In September 1997, KLDT received funding to appoint a Project Manager to undertake an initial scoping exercise. In early 1998, KLDT had an application approved to appoint a Project Animateur and an administrator to take the project forward.

Land Transfers

The first area of land to be transferred to KLDT was the former carbon factory site, an area of approximately 1.5 hectares which had been redundant since the mid 1980s. The site housed the former carbon bunkers, which were B-listed, and the former laboratory block. The site was formerly used for the storage of carbon materials and the manufacture of carbon pastes and anodes used in the smelter process.

Before the site could be handed over to KLDT, a comprehensive remediation exercise was undertaken by Alcan. This involved the removal of contaminated materials (mainly poly-aromatic hydrocarbons) from the site for treatment. Some grant support was approved by Lochaber Limited, the European Union (ERDF) and The Highland Council. These works, which cost over 600,000, saw the site remediated to a level where any future use could be permitted. Following their completion, the site was transferred to KLDT. Given the history of the site, a 99-year lease was negotiated between KLDT and Alcan Aluminium.

The transfer of a number of other sites is now being discussed by KLDT and Alcan. These include community playing fields, the site for a new community centre, the site for a small business development and various community recreational sites.

Phase 1

The first phase of development was identified as that which could proceed prior to the smelter’s closure.

The most significant scheme in financial terms was the redevelopment of the carbon factory site, following the remediation works undertaken by Alcan. The project, which cost over 1,800,000, was funded by a number of partners, including the European Union (ERDF), Historic Scotland, Lochaber Limited, Alcan Smelting and Power (UK), The Highland Council and SNH. The number of funding sources involved in the scheme has meant bringing together partners which have different remits, desire different outputs, and require the use of different claims procedures. The administration involved in managing both cashflow and physical works needs to be examined prior to the commencement of such a complex scheme.

The redevelopment of the carbon factory site has seen the creation of four new business units totalling 8,000 square feet, and the restoration of the carbon bunkers and the old laboratory building, along with landscaping improvements to the site. So far this has led to the lease of one of the units to a tele-marketing company, creating 16 full-time equivalent jobs; the further development of the old laboratory to form a bunkhouse, creating 4 full-time equivalent jobs; and the potential development on the site of a micro-brewery for which initial development funding has been secured.

The first phase of environmental improvements in the village has also been undertaken. The works included building stone walls, creating picnic sites and car-parking, paving, planting and improving frontages, creating a new business site, improving paths and erecting a community noticeboard.

A training scheme in footpath maintenance is now in its second year. It has upgraded eight kilometres of footpath, and given about 15 previously unemployed people the opportunity to gain a recognised training qualification whilst employed in a worthwhile job. To date, four trainees have gained SVQ level II on the scheme.

Various other marketing, auditing, market research and feasibility studies have also been undertaken over the last few years. KLDT has also been assisting a local community group in its attempts to develop a new community centre for the village.

Phase II

Phase II involves the implementation of the remaining elements identified in the ten-point Village Economic Enhancement Strategy. The announcement in July 1999 of 30 redundancies reduced the Alcan workforce to 60 and confirmed that the smelter will close during the year 2000.

This announcement led to detailed planning and funding applications for Phase II being undertaken. Already, a business capital cost plan for the outdoor activities centre is well advanced, with the detail of other projects being taken forward.

Conclusions

KLDT has been successful both in securing funding for projects and in meeting the target outputs and timescales of funding partners. Now that credibility has been achieved through the success of the initial schemes, it is felt that the time may be right to re-examine the structure of KLDT with a view to increasing local community representation.

In regeneration projects such as Kinlochleven the complexities of dealing with difficult projects should also be identified along with measures to counteract these difficulties. In the early phases of the regeneration programme, KLDT had to deal with a number of complex problems involving contaminated land, listed buildings, leasing arrangements, drawing funding from a number of sources, and arranging cash-flow support from the commercial lenders. KLDT’s experience illustrates how important it is that appropriate professional advice is used and that resources are made available to offer guidance to a non-executive Board of Directors.

A very beneficial factor throughout the early phases of Kinlochleven’s regeneration has been the strong partnership approach adopted by all interested agencies and community groups, spearheaded by KLDT. The structure has not only given KLDT the responsibility for land and funding, but has also given the community a focus for the regeneration, within which they can play a part. As an independent company, KLDT can also progress its own agenda on issues such as publicity and effectively raise the profile of the village.

It remains important that, in developing land for economic opportunity on behalf of the community, KLDT supports rather than leads community development ventures. This enables KLDT to remain at the forefront of economic development in the village and to focus on its agenda, while preventing repetition of the paternalistic, all-providing approach of North British Aluminium Company which created the village.

 

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