Local currencies support local economies

The value of sterling may be plummeting as fears grow over the depth of a possible recession. But in the scenic East Sussex town of Lewes – famous for its bonfire night parties and bewildering number of pubs – a handy alternative is about to become available.

Next month, in the latest sign that localism is a coming force in British everyday life, Lewes will launch its own currency. In doing so, it joins a growing list of communities around the world attempting to protect regional economies and preserve the distinctive ‘feel’ of towns and villages.

The Lewes pound will initially be accepted in around 30 locally owned shops and a first run of 10,000-plus notes is expected. It is the largest-scale launch of a local currency in the UK since Lewes had its own pound in the 19th century and, in a coup for the organisers, the town’s branch of Barclays bank has agreed to accept it.
Those pushing the Lewes pound, which by law cannot display the Queen’s head but is legal tender, stress their humble ambitions for the new currency. ‘There will always be a need for a national currency, but it’s a question of trying to go back to what can be done locally,’ said Oliver Dudok van Heel, one of the scheme’s architects. ‘This is not us versus the rest of the world,’ added Beth Ambrose, a sustainability expert, who denied that the Lewes pound was a declaration of independence. ‘All we want to do is strengthen what’s good in our community.’

According to one analysis, 80 per cent of the money that goes into a supermarket till leaves the local economy immediately. By backing local stores such trends can be reversed, say the scheme’s supporters. ‘We had a beautiful, independent toy shop here once,’ van Heel said. ‘It’s now an estate agent.’

Lewes is not alone in its aspirations. In Totnes, Devon, a complementary currency has been running for more than a year. Similar schemes have been launched abroad and it is estimated there are about 9,000 around the world. Across the Atlantic in Berkshire, Massachusetts, some $800,000 worth of local ‘Berkshares’ are boosting a thriving alternative economy. Switzerland has introduced a localised credit card scheme, while Holland and Germany have had a surge of interest in complementary currencies.
Those backing the new schemes say they are ‘big tent’ projects which try to involve the whole community. Experts agree that they thrive in places where people have become disillusioned with central government, suggesting they reflect more than merely economic concerns.

‘This is political, but with a small p,’ said Patrick Cockburn, a Lewes resident who is backing the new currency. ‘It seems a Tory sort of idea – empowering individualism – but it’s really about boosting the local community.’

In Argentina, demand for local currencies took off after the economy collapsed in the late Nineties. ‘These types of currency go right back,’ said David Boyle, a fellow at the New Economics Foundation in London. ‘There was a flurry of complementary currencies in the Great Depression. But President Roosevelt outlawed them because he was afraid they might undermine the banks.’
For this reason, proponents of the Lewes pound believe now is the right time for its launch. ‘With the current credit crunch, there is some disquiet about the global economic system,’ van Heel acknowledged. ‘Who knows how important this could be? Studies show if there is more than 12 per cent unemployment in a community these systems become very popular.’

If anywhere can make a new currency work, the locals of Lewes claim it is their town, which prides itself on its independent spirit and the absence of the likes of Starbucks. It already has form when it comes to minor uprisings. After Greene King, the brewing and pub chain, stopped selling the locally brewed Harveys beer and ale at the Lewes Arms there was a mass boycott and the drinks were back within months.

Perhaps, then, it is no coincidence that the town’s most famous resident is the radical political pamphleteer Thomas Paine, credited with sowing the intellectual seeds of American independence. Etched under a painting of Paine on a wall of one of Lewes’s churches is one of his most famous aphorisms: ‘We have the power to build the world anew.’

Two centuries on, the inhabitants of Lewes have the chance to show in their own small way that they still agree.

An outline of the Eko Currency Scheme operating in Findhorn

Introduction
In May 2002 we commenced a pilot scheme for the Eko Currency. Having successfully completed the pilot, a new issue of Ekos was launched in April 2003, which ran until 28th February 2006. The third issue will run from 1st March 2006 until 28th February 2011. There are several organisations involved including The Phoenix Shop, NFD Ltd., the Findhorn Foundation and Ekopia itself. All these organisations have agreed to accept the Eko notes in exchange for goods and services rendered. The outlets they can be used in therefore include:

The Phoenix Shop at both the Park and Cluny
Park and Cluny Foundation Receptions
The Park Community Centre and Cluny Dining Room
Findhorn Bay Caravan Park, the Blue Angel Café and Gnosis Computing.

They may also be traded between individuals and with other businesses at their mutual discretion.

Ekos are valued at par with sterling i.e. 1 eko = £1, and notes are in one, five, and twenty denominations. Change in sterling may be provided. Limits are at the discretion of traders but we suggest a maximum of 99p.

Redemptions
The notes are time limited to 28.02.11 and must be spent before that time. Ekopia cannot, by law, redeem them for £s sterling from individuals (although traders may do so at their discretion). Ekopia can however redeem the notes from traders registered to operate the scheme. Cash redemptions will be permitted on a monthly basis. A small surcharge may be levied to encourage ongoing use of the currency. Given the regular flows of cash between most of the traders involved this should not be a serious inconvenience. (Details on application)

Traders will thus be able to return surplus Ekos for redemption to Ekopia on the 30th day of every month for sterling, which would be repaid by the 15th day of the subsequent month. Full redemption will be possible at the expiry date of the issue at no charge.

After the expiry date the Ekos may not used for trading, and may be redeemed for sterling by traders for a period of one month thereafter. Traders may redeem them for new eko notes for a period of two months after the expiry date.

Current Issue

This issue has circa £18,000 in circulation. Ekopia makes one-off loans to various local organisations with the sterling raised. The Ekos are thus backed by a sterling reserve.

Ekopia intends to distribute any net surplus from the currency issue project to Community Business and Organisations either as investment capital of some kind or as an outright gift via an Ecovillage Development Fund.

Main Aims & Purposes of the Eko Currency Issue

1) To provide low interest finance and reduced banking charges for local businesses and projects, and to promote the Ecovillage in general as a place of innovation and sustainable economy.

2) To encourage trading with and between community businesses.

3) To inspire both guests and residents with the demonstration value of a locally based currency, and to get the users thinking about how and where they spend their money.

4) To create development and gift capital for local businesses and projects.