If levelling up is to be a success in the most ‘left behind’ neighbourhoods it needs to bolster their social infrastructure, alongside interventions targeted at improving specific metrics such as employment, training or education.
Both evidence and experience indicate that strong social foundations will help to secure the success of these other interventions in such areas; without it, they are likely to fail.
More than 460 public, private and voluntary sector organisations, including some 40 councils and combined authorities, are supporting a proposed ‘community wealth fund’, which would see the creation of an independent endowment designed and distributed to provide support and funding to reinvigorate social infrastructure in ‘left behind’ neighbourhoods.
Four key principles would govern the fund: long-term, ‘patient’ funding (10-15 years); investment directly into ‘left behind’ neighbourhoods; community-led decision-making; and appropriate support provided to build community confidence and capacity.
These principles are based on learnings from previous government and charitable funding initiatives.
Research from the University of Cambridge (2019) analysed the effects of government funding schemes over the past 40 years.
It found that the key ingredients to success included long-term funding of at least 10 years, community involvement embedded at every stage of design and delivery, and support and guidance throughout to ensure the best outcomes for residents.
These key elements are also supported in a recent report by Onward, a non-profit think tank, on what works in neighbourhood regeneration.
In January 2021, the Government estimated that at least £880 million could be released from dormant bonds, stocks, securities, shares, insurance and pension funds.
Currently, this funding is earmarked for spending on ‘social and environmental purposes’. We believe that this funding should be used to create a community wealth fund and would have a transformational impact on levelling up the country.
On 16 November, in a significant moment, the House of Lords voted in favour of community wealth funds during a debate on the Dormant Assets Bill.
In terms of impact, the fund is likely to have a significant payback.
A leading consultancy, Frontier Economics, conducted an independent assessment of the fiscal and economic returns of a community wealth fund in the most ‘left behind’ areas.
Using only robust evidence, and with conservative assumptions, it estimates that a £1 million investment in social infrastructure in a ‘left behind’ area could generate approximately £3.2 million in fiscal and economic benefits over a 10-year period.
It’s important to stress that community wealth funds do not seek to undermine or diminish the role of local government. Local democratic structures are an important part of our national settlement and require proper resourcing in order to play their vital role.
Rather, our proposal is for complementary investment in building the capacity of communities to participate in civic life, strengthening its weave and weft, and securing much stronger local accountability by giving communities power over some decisions and a budget to improve their areas.
Dozens of local councils and combined authorities who recognise the potential of a community-led approach to addressing deep-rooted social and economic problems have joined our campaign for the fund. We hope you will join them too.
