24 August 2020

Community Wealth Building: Kick-starting economic recovery on the doorstep

In the midst of a global pandemic, the power of ‘Community’ has come to the fore, with local residents pulling together to support each other. As local authorities undoubtedly face more budget freezes and cut-backs in the coming months, could ‘Community’ also hold the key to economic recovery?

Community Wealth Building (CWB) is an approach which puts people at the heart of economic development by maximising local economic opportunities and encouraging wealth to be ‘locally owned’. For more details read CLES’s excellent summary here. It is a concept imported from the States and in 2011, five public sector institutions in Preston and across the wider Lancashire area adopted the approach, with dramatic results. Over a three-year period spend within the Preston area went up from 5% to 18.2% and within Lancashire as a whole from 39% to 79.2%. In monetary terms this meant an additional £539m being retained locally.

Since then other local authorities and public sector bodies have embraced the idea. It’s been particularly well received in Scotland where the Scottish government sees it as a key way to deliver their inclusive economic growth strategy. North Ayrshire, Clackmannanshire and Glasgow councils and public sector agencies like Scottish Enterprise are all adopting CWB strategies, and many more will follow.

The challenge with CWB is that it’s a framework which can be difficult to apply in practice and takes time to deliver results. Preston successfully incorporated all five pillars of CWB into their strategy and it’s taken nine years to get where they are today. However, there is one area of CWB that has the potential to deliver an immediate, positive impact and this is the progressive procurement of goods and services.

Thanks to the Social Value and Procurement Reform Acts, public sector procurers in the UK have the mechanisms to implement progressive and sustainable procurement strategies, but the clauses they incorporate into supplier contracts often focus solely on job creation, without assessing and responding to the immediate needs of the community.

If public sector bodies are going to successfully use CWB to build back better post-Covid, they should start by thinking more laterally about how their suppliers can create genuine and immediate social value - without costing these hard-hit suppliers too much. The opportunity lies in thinking about what benefits your suppliers can bring to the people you have procured their products and services for. This might be job creation, but it might also be professional expertise, connections or specific resources, technology or supplies.

It sounds great but theory is always so much easier than practice. In my work as a social value consultant, many procurers struggle to identify what communities really need because they believe that finding the answer is difficult, costly and time-consuming; it needn’t be. It is often as simple as talking to the third sector organisations and social enterprises working directly with the community. These organisations know these people better than anyone else. Find out what they need and what would be of value to them, and then think about how your suppliers might create it.

The sweet spot lies in connecting supplier expertise with specific community needs and making sure these align with your regional priorities as a local authority.

Post-Covid, some of the groups most impacted by the pandemic are people suffering from poor mental health, lonely and isolated older people, victims of domestic abuse, immigrants, the homeless, the unemployed and people with long-term health conditions who are shielding. Not all of these will be a priority for your local authority, but if you focus on the ones that are and consider how your suppliers can specifically create value for these groups, this is where you will find an opportunity to build back better.

In a global economy, it’s easy to overlook the value of nurturing growth and opportunity closer to home, but this is where CWB can add real value. The pandemic has forced us all to spend more time where we live and for many this has ignited a flame of community spirit; a flame that shouldn’t be left to extinguish. CWB forces us to focus on creating stronger, more sustainable communities and this will ultimately drive long-term economic growth right on your doorstep.

Sarah Stone is director at Samtaler.

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