What is the issue and why does it matter?
Community wealth building (CWB) has developed as a response to what is seen as a failure of traditional approaches to economic development. These are based on the need for constant economic growth and an assumption that if the economy grows it will create wealth for all.
The evidence of ongoing, and increasing, poverty however demonstrates that this wealth is not ‘trickling down’ to those most in need, In addition the wealth that is generated locally, through wages and local business activity, is extracted from the locality through spend with national and international companies and the profit enjoyed elsewhere.
CWB is a people-centred approach to local economic development, which redirects wealth back into the local economy. Through this approach local economies are reorganised, so that wealth is not extracted and sent off to stakeholders, but is held locally and income is recirculated in local communities.
Key to the approach is the role of ‘anchor institutions’. These are large commercial, public and social sector organisations (including local authorities) which have a significant stake in a place. Anchors can exert sizable influence by adopting these strategies to impact upon economic, social, and environmental priorities, generating what is commonly referred to as social value.
Starting in the US, community wealth building (CWB) has emerged as a powerful approach to local economic development. It is gaining traction, particularly in England, where the Preston Model is the most talked about. The Centre for Local Economic Strategies (CLES) has been working with Preston City Council and they have published a report ‘How we built community wealth in Preston: achievements and lessons’.
CLES also have a useful report from 2019 which sets out CWB theory, practice and next steps.
Local authorities have key roles to play:
As an anchor institution themselves
As a strategic partner of other anchor institutions who may already be a part of local community planning structures
As a partner of Scottish Government, developing policies and enabling measures
It is clear that Scottish councils are already working on inclusive economies and contributing to community wealth building; approaches which support the development of wellbeing economies.
Further targeted work should be undertaken to maximise impact and to build upon existing delivery. This could be done in partnership with other organisations: via community planning; city and growth deals; regional economic partnerships and via locality planning.