Back in the office at the start of a new week, the CLES team is fired with an enthusiasm that only comes with successfully bringing 200 dedicated activists and changemakers together. As we push on to drive further actions and outcomes, the team has taken some time to offer three quick-fire reflections of our own from the day about what #cwbis to us…
Opinion Piece - Blog
If ever there was an example that epitomises the misery imposed by market neo-liberalism, it’s the plight of Britain’s seaside towns.
Decades of agglomeration has led to the incubation of ‘superstar cities’ such as Manchester, leaving places like Blackpool and Rhyl deprived and depleted. As CLES reported on in 2017, the last vestiges of their seaside heritage are now enveloped by a coil of ever-tightening social and economic decline.
Community businesses are key drivers of the local economy and a growing aspect of Local Wealth Building. They are a key means of ensuring that wealth is more readily held, used and benefits local people and communities.
Vital to this is the extent to which community businesses are woven into the supply chains of anchor institutions. Work by CLES in three locations has found that community businesses are building local wealth and it is now time to celebrate, secure and amplify their full potential within the supply chain of anchor institutions.
In the last decade, Social Value has gone from unknown and untested to the flavour of the month. Here Jonty and Matthew reflect on Manchester’s early adoption of socially-minded procurement, its impact to date and its role going forward.
The idea that when local authorities buy goods and services they should ensure that the money given to suppliers produces good social, economic, and environmental outcomes might now seem like common sense, but ten years ago there was no Social Value Policy Act and very little activity around of this nature.
For decades, our economic system has been based on a hope that a general rising tide of economic wealth will benefit us all. With the release this week of the annual UK poverty report 2018 by Joseph Rowntree Foundation, we should now firmly reject this idea once and for all. For all the description and seemingly endless talk of inclusive growth and other policy reforms, we often ignore the fundamental determinant of poverty in this country: the unequal allocation of wealth.
We must accept that the UK political economy, with its market liberal economic growth model, is intrinsically incapable of ensuring that wealth is fairly distributed. We are the fifth largest economy in world, but fifty-two percent of our wealth is held by the top ten percent, and 20% by the top 1 per cent.
Amazon’s cushy deal with New York State is further proof that local economic development has become dominated by a failed model; one which enriches global corporations and impoverishes local residents. We must be bold and recognise that agglomeration economics will not save our cities, writes Jonty Leibowitz.
Last week, Amazon finally announced that they would be building their $5bn new national headquarters in Long Island, New York, as well as a new national ‘Centre of Excellence’ in Virginia. The reveal of the location for ‘HQ2’ has been the culmination of a thirteen-month process in which Amazon received bids from over 238 cities to host the new sites, which will bring in an estimated 50,000 jobs.
Last week the government launched a series of new initiatives around ‘Social Value’, a much vaunted policy agenda which started with the passage of the Social Value Act in 2012. Cabinet Office Minister David Lidington has announced that by summer 2019, government procurements will be required to take social and economic benefits into account in certain priority areas, as well as new transparency rules for those bidding for public contracts.
The government’s attempt to get businesses to consider their social impact can be understood as an acknowledgement that something has gone awry in the state of commissioning public services. The dramatic collapse of outsourcing giant Carillion in January 2018 has prompted a new wave of governmental thinking about how goods and services are purchased. With public opinion increasingly moving against poor provision of public services (most noticeably the much criticised railway system), this extension of the Social Value Act represents the government’s response.
Fourteen to sixteen hour shifts, six days a week; low wages; potentially fatal accidents a regular risk… this isn’t a description of working conditions at CLES, but of work during the industrial revolution. Thankfully, since then, capitalism and the world of work has been transformed. Child labour is illegal, employees have gained employment rights and health and safety regulations mean that going to any workplace is significantly less dangerous than it might have otherwise been.
However, just because the number of work-related accidents has fallen over the decades doesn’t mean that modern work is harm-free. There is mounting evidence of the dangerous effects on health of modern work practices. This is most severely demonstrated within the ‘gig economy’, in sectors where workers gain flexibility at the cost of employment benefits (sick pay, parental leave and the like) and work that is, more often than not, offering unstable hours and low-paid.
Preston has been identified as the most rapidly improving urban area in the UK to live and work, according to the 2018 Good Growth for Cities index, but what’s behind its success and how can we build on it?
A bootstrap economic policy
While not playing an exclusive role, Preston’s adoption of a local wealth building approach to its economy has been a factor in the city’s success. In particular, by exploring the supply chains of some of the city’s largest employers and purchasers of goods and service, there has been a reconnection not with only the local economy but also with the local people at the heart of it.
A general rule of thumb with fringe events during party conference season is that unless you are serving warm food, you can rarely expect attendance figures to rise above thirty people. This figure might reduce if your event is too early in the morning, and further still if on the last day of conference. Therefore, the fact that almost one hundred party members, councillors, and activists attended our ‘Future of Public Services’ fringe at 9am on the last day of Labour Party conference (without a sandwich in sight) suggests that there is significant interest and traction on this agenda.
The huge appetite for new ideas was palpable across the three days in Liverpool. On Wednesday morning, there was standing room only as CLES welcomed Shadow Chancellor, Rt Hon John McDonnell MP, Lisa Nandy MP, Jim McMahon MP, Mayor of Newham, Rokhsana Fiaz OBE, and writer and broadcaster, Paul Mason to discuss how we must restore ‘public value’ to public services if we want to transform British society.
Local wealth building has emerged as a powerful tool to democratise our economy and create wealth for all. From Barcelona and Bologna to Preston, Islington, and Kirklees, the movement is growing and helping communities take back control. Jonty Leibowitz and Tom Lloyd Goodwin suggest that whilst now is a good time to recognise and celebrate these achievements, we must also be restless and ambitious, asking ourselves – ‘what next’ for this dynamic movement?
It is no surprise that local wealth building has begun to gain traction in the last decade. Across the world, communities are beginning to fight back against a political and economic system in which wealth is hoarded by a narrow few, public services are cut to the bone, and the many are consigned to lives of economic precarity and political disenchantment.
Rather than seeing the collapse of Wonga as the end of the payday loan era we need to question the underlying factors that lead people to rely on such providers, writes David Burch and Matthew Todd.
Wonga did not collapse because of a lack of demand for fast credit. Instead, new regulations – such as limits on the daily interest rate and the total amount that borrowers could pay in interest and fees – created problems for its business model. Indeed, the macroeconomic factors that created the boom of payday lenders persists and there are worrying signs that, despite Wonga’s collapse, financial distress has risen – the number of people contacting the debt advice charity StepChange for assistance is at record levels, and the rate of personal insolvencies has also increased.
The blistering words of Peter Clarke, Chief Inspector of Prisons, about the appalling state of Birmingham Prison ring in the ears – drugs, violence, fear and filth. Accurate parallels have been drawn with the squalor of eighteenth century prisons. While many have pointed to staggering challenges facing Birmingham this is not a unique case.
Commentators have variously blamed the shortcomings of G4S, a failing policy of privatisation, a decade of unrelenting austerity (with cuts of over 40% to prison budgets) leading to systemic failures in the criminal justice system which is now on its knees. Underlying all of these is something more insidious and deeply pernicious: an abject absence of the values which should imbue public services, including human dignity, equality and allocation of resources to ensure that everyone is able to access public goods (such as security, housing, healthcare) regardless of their own, private means.
News this week that Amazon has signed a five-year deal with the Yorkshire Purchasing Organisation is deeply troubling.
The £600m deal will see the multinational corporation provide a one-stop-shop for public bodies across Yorkshire; providing everything from paper clips to bandages to the schools, social care providers and emergency services in the 13 local authority areas impacted by the deal.
On 17th July CLES convened the UK’s first Local Wealth Building Summit. Hosted by the University of Birmingham and funded by Barrow Cadbury Trust, the event celebrated ten years of work to build wealth in communities across the UK and posed the key question – how do we grow these ideas so they are no longer simply a powerful alternative but a new economic mainstream?
From Kirklees to Dagenham, Birmingham to Preston, and even across the pond in Ohio, delegates and speakers spoke passionately about the work being done in communities to counter the extraction of wealth from people and places, build greater equality and create inclusive economies.