That this House has considered dormant assets funding and community wealth funds.
It is a pleasure to serve under your chairmanship, Ms Harris. I begin by saying that I am pleased to see the proposal for a community wealth fund explicitly considered in the consultation on the next portion of dormant assets funding. As the Member of Parliament for Stoke-on-Trent Central, I welcome the Dormant Assets Act 2022 and the future unlocking of new investment in good causes. Dormant assets have been a significant source of funding for youth and social investment and it is important to ensure that the next tranche has a similarly transformative effect by backing plans for the community wealth fund.
Historically, underfunded neighbourhoods have seen essential social infrastructure deteriorate, decay and disappear, resulting in depleted levels of the social capital that is so important for underpinning healthy, prosperous and resilient communities. When combined with the absence of places to meet, the lack of an engaged community and poor connectivity, these neighbourhoods experience significantly worse outcomes across a range of indicators, from health and wellbeing to education and employment.
The 225 areas the Local Trust has identified and named as left behind have considerably fewer jobs, with only 52 available locally per 100 people. Many children face poverty and live in out-of-work households and participation in higher education is markedly lower. Despite being at greater risk, these areas have historically missed out on funding. Research by the Local Trust shows that in the past two decades, left-behind communities and neighbourhoods, including those in Stoke-on-Trent Central, have received an average of £7.77 per head in national charitable funding. That is less than half the amount received in other equally deprived areas, and is well below the national average. Understandably, this makes it harder for these communities to take action to improve local outcomes and work with partners to tackle what are often deep-rooted and multigenerational challenges.
We saw these areas fare disproportionately badly during covid. Now, they are again the most vulnerable to the cost of living challenges, as they have fewer resources to draw upon and often lack the ability and skills to apply for funding. The community wealth fund would provide a crucial opportunity to correct this by creating a long-term endowment for deprived communities that have not benefited from economic prosperity, helping to resolve some of the disparities at the heart of the levelling-up agenda.
These communities are typically located in post-industrial areas in the midlands and the north of England, and are particularly prevalent in red wall constituencies like mine. In fact, seven of England’s 225 most left-behind communities can be found in Stoke-on-Trent, two of which—Abbey Hulton and Townsend, and Bentilee and Ubberley—are in my constituency of Stoke-on-Trent Central. These areas must be a priority when it comes to levelling up and fostering economic growth. Deep-seated disparities in social capital must be addressed by enabling communities to be the drivers of local social change. In particular, a community wealth fund would allow for a range of solutions that could be decided by communities based on what they know is most needed in their area.
The hon. Lady is making a fantastic speech that I wholeheartedly agree with. While talent is everywhere, does she agree that opportunity, sadly, is not? The places and spaces where people from all backgrounds can come together and build meaningful relationships are crucial to our social wellbeing, but access to them is not evenly spread throughout the country. Local people know what is best for their neighbourhoods. It is vital that the community wealth funds be available as widely as possible across the country. That involves a radical new approach to make sure that responsibility is as close as possible to the people whose lives these funds are designed to benefit.
I absolutely agree. By utilising the area-specific knowledge of local residents, priorities and desired outcomes can be determined at neighbourhood level. Polling by Survation found that the residents of left-behind neighbourhoods held a strong belief in the power of community action. A clear majority said that they would prefer a greater say over how money is spent locally. Research by the all-party parliamentary group for ‘left behind’ neighbourhoods has found that social infrastructure is what our neighbourhoods most lack. That has an impact on how people feel about their area. Clearly, we need to build community confidence and capacity.
An in-depth analysis of local area initiatives over the last 40 years by the University of Cambridge identifies characteristics that have improved participants’ chances of better social and economic outcomes. It found that the programmes that focused investment on a small geographical area of between 3,000 and 10,000 residents, which had control of decisions, design and resources to local people and adapted bespoke approaches rooted in each area’s particular characteristics, and areas that guaranteed a long-term, consistent commitment over 10 to 15 years, were found to be more likely to deliver benefits for communities.
When we talk about the politics of devolution and devolving power, too often we focus on local authority and regional level. Actually, what people really want is to get involved in their own local neighbourhoods. That is where they can make a difference. Does my hon. Friend agree that that is what the community wealth fund could potentially enable them to do?
As a result, it is important to get the structure of a community wealth fund right, reflecting the knowledge and skills of the local community, the aspirations for that community and the necessary governance to ensure the appropriate use of funds.
The community wealth fund is a place-based initiative aimed at natural communities in left-behind areas, typically with a population of around 10,000 people, which is much smaller than the typical local authority serving such areas. For that reason and others I have mentioned, a local authority is unlikely to be a suitable body to lead the community wealth fund process.
By involving communities in the process, whether planting street trees, investing in community pantries or creating a group of community callers, we will move away from doing things for people, or even with them, to giving them as much ownership as possible. The more local people are involved, the more transformative outcomes are. Partnerships work.
For decades, we have had a system that has treated citizens as consumers of services, rather than members of empowered communities, so a fundamental shift in our national thinking will be required to enable this new social model approach. However, it is an approach that the Government can embrace because it is a fundamental principle of Conservatism to believe in small Government and local, community-led solutions. We must challenge the narrative that suggests the solution to all inequalities lies in growing ever-larger, top-down-controlled public services. That undermines the power of communities to support their health and wellbeing, and stifles a philanthropic approach, which has been a lifeline during the last year.
During covid, we woke up to the power of communities. During the first lockdown, I conducted an online survey to gauge residents’ feelings, including the impact of volunteering on their mental health. The findings featured in the “Connecting Communities” report, which I co-authored for One Nation Conservatives. Of Stoke respondents, 39% stated that covid-19 changed their view of the local community. One resident from Stoke-on-Trent Central said about lockdown:
“I think it] highlights the untapped—undervalued—potential of people and neighbourhoods across the Country…Local community is essential in times like COVID. At first people were much more helpful and considerate but sadly the effect of this is fading fast. I feel that good will could have been harnessed and directed better locally and nationally.”
It is an honour to serve under your chairmanship, Ms Harris. I congratulate the hon. Member for Stoke-on-Trent Central (Jo Gideon) on securing this important debate and giving us the opportunity to discuss the next wave of dormant assets and the possibility of establishing a community wealth fund.
I am proud that in 2008 the Labour Government passed meaningful dormant assets legislation, which began to unlock this crucial source of funding from financial assets such as bank accounts. Although it is important to reiterate that the priority is trying to reunite assets with their owners, where that is not possible the money goes to causes that facilitate real change in our communities. This policy raised over £800 million of funding to support social and environmental causes across the UK, so I am proud of the work that parliamentarians across the House, including many members of the APPG for ‘left behind’ neighbourhoods, have carried out. I am pleased that this proposal, in particular the creation of the community wealth fund, is being considered by the Government. However, it is important that this matter is not just considered; it must actually amount to meaningful change.
In England, funding from dormant assets is restricted to youth work, financial inclusion and social investment. It would be good to see that expanded so that the money could be used to finance a wider range of community projects. The design of the proposed community wealth fund has been informed by the success of the Big Local programme. The 2020 evaluation of the programme found that
“The concept of putting residents at the very heart of that change is showing its value up and down the country.”
A community-led approach means that local priorities and desired outcomes would be determined at local level by the people who live there. The importance of that cannot be overstated.
It is a pleasure to serve under you, Ms Harris. I congratulate my hon. Friend the Member for Stoke-on-Trent Central (Jo Gideon). I am in a Stoke sandwich, between her and my hon. Friend the Member for Stoke-on-Trent South (Jack Brereton), which is very nice—I do not know where Kidsgrove and Talke is today.
I regret that my hon. Friend the Member for Sedgefield (Paul Howell) is not with us today. Sadly, he has suffered a bereavement. I want to put on record my appreciation for his leadership and the strong role he plays in this place in the campaign for a community wealth fund. I also pay tribute to Local Trust, some of the staff of which I suspect are watching. That brilliant organisation has promoted this proposal from outside Parliament.
I think we all recognise that this is a cross-party proposal. I agree with much of what we just heard from the hon. Member for Washington and Sunderland West (Mrs Hodgson). I do not think that a community wealth fund requires a Labour Government, nor would it prosper only under a Labour Government. This is about getting the great mission of community development, levelling up or economic prosperity—whatever we want to call it—out of the political cycle and out of the hands of central Government. It is a tremendous measure that is in exactly that spirit.
My work outside politics was mostly in charities. I found that the most effective aspect of our work is not about the type of service that is delivered—not the “what”—but it is about the “how” and the “who” that do it. It is the quality and nature of the service that matter. What is crucial is giving people a sense of belonging and agency. That is what we need. My hon. Friend the Member for Stoke-on-Trent Central made a very good point about the importance of treating people not as passive recipients of services but as active agents in their own lives and their own prosperity. The idea of a community wealth fund speaks to that, and would strengthen that spirit across the country.
It is a pleasure to serve under your chairship, Ms Harris. I thank the hon. Member for Stoke-on-Trent Central (Jo Gideon) for leading the debate and setting the scene so very well, and for the other contributions and those that will follow.
I recall speaking in the Chamber on this topic in January so it is one that is close to my heart. It has been almost a full year of seeking assurances on the Dormant Assets Act 2022 extending to Northern Ireland. I am very pleased that we are able to say that it is and that we are able to use it for the purposes referred to here by hon. Members. It is really good news. I completely welcome the Act’s premise of ensuring that dormant funds find a way back to their owner, and if not restored to their owner, allocated to generate social engagement and social life in large enterprises to the benefit of the country’s people and, indeed, to the benefit of all, so it is really good news.
I will quickly speak about Northern Ireland. The Dormant Accounts Fund NI supports the voluntary, community and social enterprise sector in Northern Ireland to be more resilient and prepared for the future by funding activity that increases capacity and sustainability. Community funds offer up to £100,000 for any one organisation that can make real changes in the local community. There are many people with ideas, ability and talent to do just that. Figures released by Social Enterprise NI show that there are almost 843 social enterprises in Northern Ireland, generating an annual turnover of approximately £980 million, and that almost 25,000 people are employed in the Northern Ireland social economy. I fully support the use of dormant funds to improve our social sectors. Sometimes, those are the organisations that struggle the most to get up and running, so it is good to encourage them and have a way of doing so.
There have been differing comments surrounding the use of community wealth funds, by which dormant assets can be used for research and analysis regarding left-behind neighbourhoods. We all have such places in our constituencies: those left-behind neighbourhoods that need that wee bit of help. I have them in Newtownards. They are socially deprived and we hope that we can get some of the funding out to them. So far, we have done some of that.
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With the community wealth fund, we have the opportunity to harness this.
The indicator that shifts most when communities are part of levelling up is civic pride. When we see improvements for community outcomes, we also see improvements in other areas. Many success stories of locally empowered communities have shown that we can expect investment into projects that enhance environmental sustainability and stewardship of local resources, such as ethical food production and better green spaces. I was delighted to welcome several such local initiatives to the local food summit I hosted in Stoke-on-Trent. Standing Tall 2gether is based in Bentilee and improves the lives of local residents through food activities, training and bespoke volunteering, and has a household essentials refill hub. Birches Head Get Growing is another local initiative that encourages people to offer their time and skills to support unmet needs in the local community, moving from a gift model of support to an energetic exchange. In2 Health and Wellbeing is a social enterprise committed to improving the health and wellbeing of disadvantaged young people in Stoke-on-Trent. It uses sport, physical activity and education to engage local people across the community.
I am convinced that not only would the community wealth fund help to meet Government goals, but we should also expect knock-on benefits for the economy. Replenishing stocks of social capital is vital for seeding economic activity, but also through the direct supply of local employment, opportunities for training and skills development, and building and rejuvenating community assets.
Indeed, there is strong evidence for the impact of a community wealth fund. Modelling by Frontier Economics estimated 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 10 years, actually helping generate savings. Combined with the fact that in areas with locally led solutions there is a faster decline in crime rates, the community wealth fund is an exciting opportunity to significantly boost the Government’s levelling-up agenda without placing pressure on public finances.
Community wealth funds can also play an important role in supporting early-stage social entrepreneurs in marginalised constituencies by connecting them to wider support to maximise their growth. The proposals would provide extra initial start-up support, among other things, in the most underserved parts of England. Harnessing the full potential of communities will require targeted interventions to create jobs, stimulate inward investment and grow social enterprise and trading charities.
Members of the APPG for ‘left behind’ neighbourhoods have expressed support for the community wealth fund in the past, and the Government listened when earlier this year we made the case for including the fund as a potential new beneficiary of the next wave of dormant assets. The dormant assets scheme has created a unique opportunity to repair the social fabric of disadvantaged neighbourhoods. Now that the consultation has finished, I am grateful for the opportunity to restate my support and to recommend that the Government capitalise on the potential of investment through a community wealth fund.
Backed by a growing alliance of over 600 public, private and community sector organisations, the fund would provide long-term investment to rebuild essential social infrastructure in the left-behind neighbourhoods that many of us represent in Parliament. It would empower communities to play a much more prominent role in local decision making and inspire civic pride, as has already been demonstrated. I am incredibly grateful to my colleagues who have supported our cause so far, and I urge them to keep up the momentum so that we can deliver real and meaningful long-term change for communities like those in my constituency of Stoke-on-Trent Central and across the country.
I want to use this opportunity to highlight the important research conducted by the Oxford Consultants for Social Inclusion, in collaboration with the APPG, which identified 225 left-behind neighbourhoods. These neighbourhoods face significant deprivation, as we heard from the hon. Member for Stoke-on-Trent Central, as well as poor connectivity and lower levels of community engagement and activity. That is especially poignant to me as the neighbourhoods identified include St Anne’s and the Washington North ward in my constituency. For example, in St Anne’s, there are only 25% of registered charities per 1,000 people compared with the English average.
Away from these statistics, I know at first hand the difference a community wealth fund would make in Washington and Sunderland West. This funding pot, which is now estimated to be £880 million, would be transformative in building community confidence and provide the foundations to enable the residents of the most left-behind neighbourhoods to bolster their social infrastructure. Consistent with this, the wards most in need of investment would receive awards, as opposed to having to compete for funding. That would be the right approach. Bids for levelling-up funding and freeports have pitted the poorest in our society against each other, rather than focusing on those in greatest need.
A number of hon. Members in the Chamber were at a meeting of the APPG just last week. I have co-chaired a couple of the meetings of the APPG’s inquiry into levelling up, in which we heard about the power of local communities to take action to improve outcomes for local people, for instance through award-winning community mental health programmes for young people, or through support to strengthen the local economy and support jobs and businesses. Levelling up seems to be cosmetic: if we move people from the bottom rung to the second rung from bottom, we can claim to have succeeded. Labour wants equal opportunity for every part of the country. The APPG inquiry shows that communities can develop themselves despite Whitehall neglect, so imagine what communities like mine could achieve with access to the appropriate resources and long-term support under a Labour Government.
That is why the community wealth fund is vital. I hope that the Government appreciate its importance, and that the community wealth fund will be one of the beneficiaries of the next wave of dormant assets.
I echo the point my hon. Friend made about people stepping up, establishing mutual aid groups and taking responsibility for neighbours during in the pandemic. It is not unfair to say that, in a sense, it was easy then: people were being paid to stay at home, so they could take part in their communities. The need was obvious—people who were isolating needed to be delivered food and medicines—and the demand was short term, only a few months at a time. However, before and subsequently, and increasingly because of the effect of the pandemic and all the lockdowns, we have long-term, wicked, entrenched problems and people who are very overstretched. We do not have the capacity in our communities that we had during lockdowns.
We need to build our social infrastructure. That was the key recommendation of the report that I wrote for the Government in 2020 on how we might build on the community spirit that the lockdown had brought forth. The answer is quite simply that we need to create the conditions in which people can be good neighbours and that means creating social infrastructure.
We can do a lot with policy. This is not the moment for the discussion about how we reform public services and local government, but there is one big thing we can do. I know the Minister has been harassed and harangued on this topic by many of us over many months. He has taken it with great patience and I hope he is not going to suddenly flip and say “Ah, no!” to us at the end of the process, because we have lobbied very hard. The big idea is that we establish a great new national endowment for our communities—a community wealth fund, which would support those non-commercial or sub-commercial activities that are so essential to local growth, including parks and libraries, arts and sports centres, facilities for the elderly and for the young and, as my hon. Friend the Member for Stoke-on-Trent Central says, social enterprises and community businesses. We need to develop the capacity of local places.
I will end with one more observation. It is not enough to provide the money; we need also to ensure that communities have the capacity to bid for it, plan the services and then run the services themselves, so there is a capacity-building element in this. I pay tribute to the people who are trying to develop Community First, a model based on Teach First that gives people the opportunity straight out of university to become community organisers in an area of the UK and to develop their skills that way. Creating more opportunities for community organising will be helpful. We need to build social capital, Madam Chair, and even if financial capital is all you care about, which I am sure it is not, the evidence is that social capital is what drives economic growth and not the other way round. So we need to invest in the infrastructure of our communities and our proposal will do that.
Some communities not only have severe socio- economic challenges, but lack social infrastructure, defined as places and spaces to meet, digital and physical connectivity and an active and engaged community. Indeed, some estates in my constituency lack all those things. Furthermore, the community wealth fund has identified 225 neighbourhoods in England with those features. Given that the Dormant Assets Act applies to the whole of the United Kingdom, can the Minister clarify whether he has had any opportunity to discuss with his counterparts in Northern Ireland how those things are going, how they are rolling out, and the success stories that are quite clearly there?
To conclude, I acknowledge the progress and success that the Act has brought so far. I am excited about it, and am pleased to see it has been a success with community groups and enterprises. There must be further engagement between them and the Government, to ensure that opportunities and benefits are provided for all.
Money should not be wasted; it should be available for our constituents to benefit from. The figures are massive, and the funding that could provide for social enterprise and perhaps community wealth funds in future is needed and deserved. Alongside the success stories, let us do a wee bit more. I am looking forward to hearing from the Minister; I suspect the answers will be easier here today than in the Adjournment debate last night.