At a time when all nations face unprecedented challenges of climate crisis, global economic instability and a cost of living crisis, a progressive bold and brave national economic policy response is required.
Scotland, we have the pioneering North Ayrshire taking forward CWB in 2018, and since 2020 a number of other areas have been working on and delivering community wealth across Scotland – including five pilot areas supported by the Scottish Government.
CWB is a tried and tested practice that is already delivering better outcomes for people, businesses and communities. From transferring economic assets to communities for economic benefit, through land reform, growth of cooperatives and employee ownership, the work of our enterprise agencies, local investment and sustainable procurement, there is much pre-existing activity.
However, we must and can go further, and this proposed legislation, allows Scotland to go deeper and with more pace in delivering a wellbeing economy that genuinely works for all Scots.
At its core, the CWB model is about the flows of wealth and investment across the five pillars of Community Wealth Building. Wealth and asset ownership is the defining feature of all economies, and to deal with economic sluggishness, social hardship and the environmental crises, we need to change how wealth is produced and used.
As such, CWB does not just focus on traditional wealth redistribution policies such as regeneration or traditional welfare policy, in which wealth redistributed after economic activity. CWB is not about repairing inequality and poverty afterwards or about managing the symptoms of economic sluggishness but instead focuses on the causes.
Therefore, CWB digs into wealth flows: from investment, to economic multipliers through to innovation, production and crucially how wealth sticks and recirculates within our economy by increasing the percentage of people and communities who own economic activity and assets.
CWB is about giving employees a genuine say in the workplace or by being their own bosses through employee owned firms and cooperatives. As evidence has shown, when this happens productivity grows, wages can be higher, and shareholder dividends are more likely to be recirculated back into the Scottish economy.
Similarly, when public procurement contracts flow into innovative local, social or environmentally aware firms, then local economies and the planet benefits. Or when finance and investment is confidently directed toward the ingenuity and creativity of all Scots, the probability of economic success is greater. And when more communities own our land, for say energy generation, then economic gain is more readily recirculated back into local communities.
All of this is about democratising the economy. Whereby the economy is not just something we fit into, but rather something which we all actively participate in, can shape and gain from.
Whilst Scotland may not have invented CWB, unequal patterns of wealth and wealth extraction from the Highland Clearances, through urban industrial expansion and our response to them have part defined the economics of our nation. There is a historic precedence and in these crises laden times, there is a growing consciousness that the wealth that Scots produces should be a collective endeavor, with the concern for the plight of others and the environment hotwired in.
In Scotland, over the last 3 years, we have taken a three pronged approach to CWB. We have built a network of interested folks: now a movement of institutions, communities, localities and organisations who understand what CWB entails and how it can be done.
This includes some of our key national and local anchor institutions including health boards and universities (who as economic agents and market shapers in their own right) have started to explore what CWB offers them and how they can help to advance the agenda. These are now key advocates.
There has also been work on policy and legislation, looking at how we change policy to reduce existing inertias and barriers that hinder the speed at which CWB can be delivered at a local, regional and national scales. And of course this is all supported by on the ground practice with actions and outcomes now being delivered in a number of locations across Scotland.
CWB is a big opportunity, as it allows us to reshape how the economy works and who it works for. And aside from creating a clear set of CWB principles by which we can deliver on a wellbeing economy, the legislation allows us declutter the policy and practice landscape by making economic development simpler, easier and by getting all public institutions focussed on their economic role.
In conclusion, CWB is about building an effervescent economy in which all Scots can participate in and benefit from the wealth it creates. Indeed, by given more Scots a stake in the economy as well-paid workers, owners, entrepreneur or business owner we are maxing out on the creativity and labour of all Scots and in so doing we are making our economy more resilient and productive.
This consultation on the legislation is a significant opportunity for all businesses, local councils, public sector bodies, Trade Unions, communities, and every Scot should seek to air their views on the future direction of the economy.
The time is ripe to deepen and grow CWB – our best chance to turn a wellbeing economy into reality. The groundwork and appetite is in place, and now with strong legislation we can secure the gains, deliver more and with pace. We must and can build an inclusive economy for all Scots.
Neil McInroy is a Community Wealth Advisor to the Scottish Government and Global Lead for CWB at The Democracy Collaborative.