Community Wealth Building - Beyond the Preston Model
The Harris Museum and Gallery, Preston, England. Photo by Michael D Beckwith
Matthew Brown, in his 2021 book Paint Your Town Red, describes how Preston, a small Northern English town with a population of around 123,000, became a pioneer in the implementation of community wealth building.
Councillor Brown was elected in 2002. Nine years later, in 2011, he was responsible for “community engagement and inclusion” when plans for a £700 million shopping centre development in the town collapsed.
It was at this point that he realized how the traditional growth model based on attracting inward investment could no longer be relied upon. Moving forward to 2013, Preston City Council teamed up with the Centre for Local Economic Strategies, Cooperatives UK and the University of Central Lancashire to explore how it might be possible to apply community wealth building ideas in the town.
This resulted in identification of a procurement spend of close to £750 million from six major anchor institutions - Lancashire County Council, Preston College, Community Gateway, Cardinal Newman College the Office of the Lancashire Police and the University of Central Lancashire. Unfortunately, at that time only 5 percent of this spend was with organizations within the Preston boundary.
Councillor Matthew Brown speaking at the New School in November 2019. Photo by Trevor Scholz.
How does Community Wealth Building work?
The goal of community wealth building is to redirect as much of this spending as possible to local businesses, while at the same time enhancing the local economy’s capacity to supply goods and services by creating a tightly integrated ecosystem of cooperative enterprises.
By 2019, £74 million was being redirected back into the Preston economy, with unemployment dropping from 6.5 percent in 2014 to 3.1 percent in 2017. Preston was named the ‘Most Improved City in the UK’ in 2018. During COVID19, unemployment in the town rose slightly but as of September 2023 the rate stood at 4 percent (down from 5.3 percent from September 2022).
The Preston Model represents a re-imagination, born through adversity, of what is possible in terms of local economic stewardship. It is a powerful example of local government combining advocacy with spending power to stimulate fairer work and social initiatives, reduce inequality, and increase youth employment.
Research has revealed the impacts of community wealth building go beyond economic and employment changes to bring about improvements in health and well-being in Preston.
Since the program was introduced researchers report “a 3% decline in antidepressant prescribing, and a 2% decline in the prevalence of depression, along with a 9% improvement in life satisfaction, and an 11% increase in wages, compared to expected trends.”
Sources of Inspiration
The approach adopted by Councillor Brown and his colleagues was inspired by the Mondragon Model from Spain, an example of a cooperatively owned corporation employing close to 70,000 people. It has become has become a beacon recognized across the globe and is described as a “more humane and egalitarian way of doing business.”
Perhaps the most interesting twist in this story is the fact that the founders of Mondragon took inspiration from the Rochdale Pioneers who established the first cooperative in 1844. Rochdale is a mere 50 km drive from Preston.
The Preston team also connected to the Democracy Collaborative based in the United States that had developed the Cleveland prosperity model with the Evergreen Cooperatives. The procurement spend of anchor institutions in the Cleveland area was much larger at US$3 billion per year and implementation of the community wealth building strategy created around 5,000 jobs.
In July 2023, Sarah McKinley, Director of the Community Wealth Building Programs at the Democracy Collaborative kindly delivered a talk to my course on Ethical and Regenerative Cities. The title was Community Wealth Building - How democratizing the economy can help build ethical, regenerative communities.
The video of her talk to my class is shared below.
Visiting Preston
On 9 March 2020, while researching our ethical cities book, I visited Councillor Brown in Preston to hear from him directly about his work with community wealth building. As you can imagine these were difficult times to be traveling with the UK COVID19 cases rising rapidly and the government introducing a range of measures before the end of the month. Indeed, it was very gracious of Councillor Brown to go-ahead with the meeting.
At that point he had been leader of the Council for less than two years and he talked about the importance of engaging with the local community around the Preston Model to raise awareness of its positive impacts.
Indeed one of the critiques of community wealth building relates to flaws in the community engagement process. Research has shown that in some instances there is a “disconnect between what local communities want and what is being offered by the good intentions” of the local authority. The latter tends to set the agenda and then consults with the community after key decisions have been made.
My discussions with Councillor Brown were wide ranging and he was open to criticism of the approach adopted in Preston. However, he was keen to point out the “good motivations” underpinning the model and evidence of real social benefits associated with cooperatives in Spain and Italy such as longer life expectancies and higher incomes for workers.
He argued that at the local level, even if you are only a small Council, you still can be radical and innovate to try to change the system around you. Indeed he was most interested in the transformative aspects of community wealth building since he acknowledged the town still faces many major challenges related to inequality, deprivation and child poverty rates.
Visiting Preston City Council on 9 March 2020 to meet with Councillor Matthew Brown.
Beyond the Preston Model
In her July 2023 talk, Sarah McKinley introduced both the Cleveland and Preston Models. However, she also provided examples of how community wealth building is gaining momentum in other regions including North Ayrshire in Scotland which launched its strategy in May 2020.
At the national level in Scotland, the Government has adopted the community wealth building approach to economic development and this is embodied in the March 2022 National Strategy for Economic Transformation. The strategy highlights five basic pillars of community wealth building as:
(1) Spending - ensuring the community benefits from procurement and commissioning directed at local enterprises;
(2) Workforce - increasing fair work;
(3) Inclusive ownership - developing social enterprises including cooperatives;
(4) Land and property - ensuring that local communities gain from land and property assets; and
(5) Finance - ensuring investment and financial institutions work for local people.
Other examples of community wealth building from the UK are listed on the website for the Centre for Local Economic Strategies and include Birmingham, Brighton and Hove, Darlington, Leeds, Lewes, Luton, Manchester and Southampton.
Elsewhere in Europe there is the Amsterdam’s Nieuw-West Pilot Strategy in the Netherlands and the adoption of community wealth building by Dublin City Council in Ireland
When I asked Sarah McKingley for examples from the Asia Pacific region she pointed me towards the City of Sydney’s Community Wealth Building strategy and it appears that several cities in South Korea are exploring potential adoption in the future.
This upsurge in interest was acknowledged by the OECD webinar in January 2023 with the title “Community wealth building at scale: Experiences and Lessons from Scotland.” You may be interested to check out the video of that webinar below.
It is clear that community wealth building has emerged as an important tool to support the transformation of local economies in a manner that promotes well-being and inclusiveness while at the same time seeking to reduce inequalities and poverty. It is part of a broader movement towards a more ethical economy that places the needs of people and communities at the centre.