Liverpool, probably more than any other regional British city, is imprinted on our national psyche – for both good and bad reasons. It has an outstanding cultural record, from the Beatles to writers such as Jimmy McGovern, Beryl Bainbridge and Willy Russell, and has bred talents as diverse as Simon Rattle, Ken Dodd, Alexei Sayle and Ricky Tomlinson. Yet the city has also been managing decline for many years, not helped by the Militant lunacies of Derek Hatton’s so-called leadership in the 1980s. It has also been touched so often by tragedy, from the Hillsborough disaster to the murder of Rhys Jones; and it still has a bad public-health record and poor housing.

It was because of its good record in the arts, and its need for rejuvenation, that Liverpool was, in 2003, awarded the accolade of European Capital of Culture for 2008, the first British city to win the title since Glasgow, in 1990, which launched its year on the back of a clever and effective slogan: “Glasgow’s Miles Better.”

I asked the Liverpudlian television executive Phil Redmond, creator of Brookside and Hollyoaks, who was brought in three months ago to oversee (some would say shore up) Liverpool’s artistic programme for 2008, if he thought his city needed its own slogan. “No, we don’t,” he says. “Actually, we don’t care what other people think, though I suppose that if we were to tell outsiders about ourselves, our slogan might be something like, ‘We’ve got it – come and get it.’”

While that might sound like arrogance, at least there is now some swagger in Liverpool. From almost the time the city heard, to everybody’s surprise, that it was to be Capital of Culture, it has squabbled over who should run the year of events and what they should be about. “It’s been like organising a Scouse wedding,” Redmond admits. “You know, like who sits with who, and rows between the families.” Fights broke out between the local Labour and Liberal Democrat parties, and between the politicians and the executive of the Liverpool Culture Company. The Australian artistic director, Robyn Archer, came up with some rather unsuitable ideas and eventually resigned.

A visitor to Liverpool these days will see a city in a state of physical transition. Building projects are everywhere, particularly by the old docks – a vast new shopping centre, fancy flats (though locals complain few will be able to afford them) and early construction work on the new Museum of Liverpool. Unfortunately, this will not be ready until at least 2010 – which many suspect will be 2012. At least the Bluecoat arts centre will reopen next month after a £12m refit.

After much thumb-sucking, Liverpool is to get both Ringo Starr (in two weeks’ time, for the official opening weekend) and Paul McCartney (at a concert in June). Rattle will come to conduct, while the Liverpool Philharmonic Orchestra will feature 30 new commissions, including works by John Tavener, Karl Jenkins and Michael Nyman. Redmond thinks there is too much emphasis on music (also included are Dave Stewart, the European Union Youth Orchestra and the BBC Electric Proms) and not enough on literature and drama. So, somewhat late in the day, those fields are being boosted. In October, the Everyman will stage King Lear, with Pete Postlethwaite – who learnt his trade at the theatre in the 1960s. Next month, it will put on Three Sisters on Hope Street, a reworking of Chekhov set in Liverpool’s Jewish quarter after the second world war. And the city still hopes to involve its three great living dramatists – Russell, McGovern and Alan Bleasdale. McGovern had earlier told me he did not think the year’s events were aimed enough at the people of the city.

This begs the fundamental question, who is the year for, Liverpudlians or visitors? “Yes, 18 months ago, the programme was not enough for the locals,” Redmond says. “I think we now have the right balance of 50/50.” Liverpool, note, is Britain’s fifth most visited city, and has a much higher reputation overseas than it does here. I saw a couple of Americans down by the docks negotiating their £35 tourist taxi ride of old Beatles haunts.

“The programme uses the city itself, its past and present, and its local talent, as the main inspiration,” says Fiona Gasper, one of the two executive producers of the arts programme. So, for example, Roger McGough, one of the city’s most enduring poets, will be performing, while the Playhouse will stage a new musical comedy looking at the history of the Adelphi hotel. Not everything is Liverpool-based or inspired. Akram Khan is working with the National Ballet of China, and there will be an Arabic arts festival, as well as exhibitions of Gustav Klimt and the French pop artist Niki de Saint Phalle. The Stirling architecture prize will be held in Liverpool towards the end of 2008, moving out of London for the first time, as did the Turner prize this year. “For us, 2008 is not in itself the beginning or the end,” Redmond says. “You will see that, particularly near the end of the year, the programme will be geared more towards regeneration.”

Redmond certainly seems to have given next year’s programme greater direction. He has banged heads together. Yet can Liverpool hold it together? Any big mishaps will be leapt upon by a media that delights in schadenfreude. Last summer, for example, the city did not help itself by having to cancel, at short notice, its Mathew Street festival. In its year as European Capital of Culture, a city steeped in a culture of football must beware of letting in too many artistic own goals.

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