Wirral Borough Council has launched a community wealth building strategy, hailed as an “ethical economics” model by Liverpool metro mayor Steve Rotheram.
Politicians, economists and business stakeholders from across Merseyside gathered in Birkenhead town hall on Monday to witness the unveiling of its new programme.
The strategy recognises the local authority as a major procurer of services, enabling it to help grow local economies through procurement and extending loans and room space to aid new businesses, co-operatives and start-ups.
Speaking at the event, Rotheram said: “Congratulations to Wirral Borough Council for leading local authorities in this city region, across the North and across the country in the use of community wealth building as a tool for economic development.”
The council is working with the metro mayor’s office, the Community Savings Bank Association and other stakeholders to set up a new regional bank. The stated aim is to keep money within the north west and enable local lending in response to business needs.
The mayor added: “It’s bold but doable and absolutely necessary. Working together like this, we will be able to do more at a faster pace to affect social change for good.”
Labour MP for Birkenhead Mick Whitley also attended the event, and said: “Birkenhead has a proud history of leading innovation and I’m glad to be present at the dawn of a new radical economic beginning that will democratise our local economy, and begin the process of making our local economy work for the many that live and work here.
“I’m especially keen to work with the council and employers and our local people themselves going forward to see our youngsters receive the high-skill training they need. I hope we can grow this model here to suit our one needs and to ensure that our economy can flourish in the future and see Birkenhead become a centre for high-skilled, well-paid secure green new deal jobs your country needs… Today is a great step on that road.”
Wirral is being supported in developing the new approach by the Centre For Local Economic Strategies (CLES), which is supporting councils to customise community wealth building to the specific needs of their particular areas.
CLES director Neil McInvoy told the meeting that community wealth building is “economic plumbing”, with the aim to “plug leaks and stop wealth slipping away from the area in which it is made to bank accounts in the Cayman Islands”.
It was stressed at the launch that local alliances, such as with NHS providers in the region, can be used to develop community-led economies. McInvoy added: “The NHS can be a major agent of change. It has land, assets and billions of pounds in procurement power.”
The head of the Wirral community wealth development model, councillor Janette Williamson said: “By embracing community wealth building, Wirral will be able to embed local people-centred economics at the heart of everything we do.
“It means the council will not do stuff to people but with them. We will stop wealth flowing out of Wirral and retain it for the benefit of making our local economy more democratic. We will be stopping the flow of wealth from the corporation to the large external stakeholder.”
Community wealth building was pioneered in de-industrialised Cleveland, Ohio, as a way of enabling the benefits of economic development to be retained locally.
The model is a reaction to profits being made by a community but serving to benefit large corporations and leaving the area in which they were earned.
It is intended as a people and community-centred approach to economics to ensure that financial value created in a region is reinvested in that area.
The strategy in Wirral is intended to counter the effects of globalisation and a decade of austerity policies through innovative local economics and co-operation.