July 14, 2020
Keep the spend local
Procurement has become a byword for minimising costs to the public purse, achieving ‘best value’ etc whereas its potential to deliver multiple social and economic goods has been largely ignored. It partly explains why the continual wrongdoings of outsourcing behemoths SERCO and G4S are routinely ignored, with contracts regularly renewed. Until now that is. Rather than line the pockets of shareholders, the idea that public spending can support local economies is starting to gain traction. The community wealth building ideas of Neil McInroy at CLES have recently found favour within Scottish Government.
There can be little doubt that the Covid-19 pandemic has served as a stark reminder that our economic model has failed us.
Far from delivering on the promise of prosperity for all, it has left too many less secure and worse off, enriched the already wealthy few and propelled us further down the road to ecological disaster. In the face of unprecedented economic challenge, we need to reset and build a new economy: one in which wellbeing stands above economic growth. To date, such a commitment has been absent at the UK level. Whilst statements about building back better have been made, at the time of writing we are yet to see how this is to be achieved.
This guide aims to give much-needed substance to these ambitions. It sets out an achievable vision for the just recovery and social, democratic and economic reform of localities, led by local authorities. To do so, it uses the framework of community wealth building – a people-centred approach to local economic development that CLES and others have advanced in the UK and internationally over the last 10 years.
Despite the catastrophic funding shortfalls that have beset local authorities for the last decade, and now look set to grow, there is much that they can do to mobilise a community wealth building approach. This document provides a practical guide for the willing. It sets out two roles for local authorities which, taken together, constitute a powerful model for progressive local economic development:
- The analyst
By developing and maintaining a deep understanding of the local economy and the impacts of the Covid-19 pandemic in their area, local authorities will be critical to creating a local economy which addresses the interconnected priorities of poverty, ill health, social isolation and inequality.
- The anchor and agent of change
By realising the potential of their role as an anchor institution for their place, local authorities – and other large, locally rooted institutions – will be key sources of the purchasing power, assets and employment with which economies can be recovered and reformed. By using these levers, local authorities will exercise strong, confident intervention in local economies to advance the cause of social and economic justice for all.
In setting out these actions, we recognise that they go against some of the prevailing winds of the policy and financial framework of the UK. That is why, throughout this guide, we supplement our practical prescriptions for action with information on national policy changes which are needed to truly realise reform.
The proposals set out in this guide will not be easy. They run part-counter to the prevailing orthodoxy and the thrust of much UK-wide national policy and are hamstrung without a comprehensive and just financial settlement for local government. But if we are to build new economies that work for communities, that work to address climate change and create resilience where there is risk and precarity, then this is the approach we must take.
There is no alternative. This must be the new mainstream.