December 1, 2020
Community Wealth Fund?
Approximately £1billion was raised from dormant bank accounts after legislation permitted these ‘lost’ assets to be put to good use. At the time, we argued that Scotland’s share of this windfall should be passed directly to the most disadvantaged communities in the country, giving local people direct control over the resources with which to tackle whatever issues faced them. Needless to say it didn’t happen. Now an even larger sum could be raised by identifying other forms of dormant assets – potentially many billions – and there is a growing lobby across civil society in England to create a Community Wealth Fund. What’s happening here?
Executive Summary. Full report here
A new wave of unclaimed assets could be worth billions of pounds. While this money may be a long way away, a consensus is already emerging around how these resources could be used most effectively for the benefit of society. The Government, NCVO, Locality and others are all keen to see the money used to provide strategic, long-term funding to support communities who need it the most.
Since the Brexit vote, many people in the UK have started to give greater consideration to how local communities might recapture a greater sense of empowerment and control over their futures. How can we bridge divides and address the feeling of being “left behind”? Rebuilding social capital and trust is back on the agenda – essential to the functioning of our society and economy.
We know that civil society builds trust and connections and creates a sense of belonging. Associations enable people to participate in their communities. But civil society is fragile and held back from helping communities fulfil their potential, due to a mix of funding pressures, market forces, myths about charity overheads, and flawed policy responses. We know we must address the fragility of the institutions and spaces that enable participation and association, in turnrebuilding social capital. This is how we can rebuild trust.
Some places have been left behind by globalisation as our economic model has not benefitted all communities equally. But areas of deep-seated deprivation can recover through emerging models of local economic development. Communities are seizing opportunities to do things for themselves. New Shared Prosperity Funds, which will replace European Structural Funds, will provide a unique
opportunity to support and develop these solutions. But prosperity requires investment in social, not just economic capital. We need to nurture social capital in areas where it is weak or non-existent and help communities develop the capabilities needed to participate in community economic development. This requires a new approach.
So our proposal envisages the creation of a Community Wealth Fund, providing long term, patient investment in support of place-led change – a fund to create opportunity and unlock the power of communities. This fund would seek to empower people to develop solutions and enable communities to develop their own responses.
Unclaimed assets in insurance and pension funds, bonds and stock and shares are potentially worth billions of pounds. But we could see the creation of a fund worth £4 – £5 billion if a range of resources were brought together. This could include the release of share capital from the private sector, civil society’s stranded assets, other unclaimed assets not yet identified and community assets which already exist at the local level.
It is too early to specify in detail how such a fund would be managed and distributed. But our consultation suggests considerable consensus around the principles of a place-based model, long term funding, community control, national support and collaboration with other stakeholders.
A fund on this scale could deliver transformative social, economic and financial impact. It could also support community commissioned services, save assets, build new infrastructure, enhance democracy and build new relationships across society. We therefore recommend that civil society establishes an independent and credible taskforce, with the support and endorsement of Government, to take the Community Wealth Fund proposal forward over
the coming months. We look forward to playing our part in its development, creation and success.