LT-21-11-Levelling-the-land.pdf

LT-21-11-Levelling-the-land.pdf - page 1/31 - Levelling the land:

Levelling the land:

LT-21-11-Levelling-the-land.pdf - page 2/31 - About this report Local Trust commission…

About this report Local Trust commissioned Dan Gregory to research and write this report considering social investment and left behind neighbourhoods. It is based on desk research and some interviews with Big Local residents and makes the case for a new, long term investment, which shares risks. About Dan Gregory Dan Gregory is an independent advisor and researcher. He has worked for the Treasury and Cabinet Office, where he led the development of government policy on social enterprise access to finance and the role of the voluntary and community sector in public service delivery. For Social Enterprise UK, Dan has advised government departments globally on the development of social enterprise policies and has led research into social enterprise in around 20 countries. Local Trust is registered in England and Wales, charity number 1147511, company number 07833396. localtrust.org.uk This work is licensed under the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License. To view a copy of this license, visit http:// creativecommons.org/licenses/by-ncsa/4.0/

LT-21-11-Levelling-the-land.pdf - page 3/31 - Contents

Contents

LT-21-11-Levelling-the-land.pdf - page 4/31 - Foreword

Foreword

LT-21-11-Levelling-the-land.pdf - page 5/31 - The reports conclusion is clear: we need…

The reports conclusion is clear: we need to rethink current models of social investment if they are to be relevant to and make a difference in the most deprived or `left behind neighbourhoods. As Barbara Slasor from Gaunless Gateway Big Local puts it, social investment could make a difference in her area, but it needs to be "done right". As the report argues, social investment done right for disadvantaged or `left behind areas would be focused on meeting the communitys needs rather than financial returns for investors, embrace risk, have some degree of flexibility and � crucially � be very long-term or patient.Those new approaches to delivering social investment would need to be conceived of and delivered at a very local scale, with ideally, significant involvement from local communities. Models based on these principles could build on and develop local assets, help create more vibrant local economies, and build wider community confidence and capacity, whilst also generating a financial return for investors. Our intention is that this report will start a conversation that will inform the design of new and more appropriate models and approaches to social investment � ones capable of supporting change and tangibly turning around the fortunes of the most deprived or `left behind areas.

LT-21-11-Levelling-the-land.pdf - page 6/31 - Introduction

Introduction

LT-21-11-Levelling-the-land.pdf - page 7/31 - In the early days of the social investme…

In the early days of the social investment industry, advocates were focused on creating wealth and employment in the UKs underinvested communities. Later, the emphasis shifted towards enabling civil society or the third sector to access much more significant levels of finance. Latterly, the defining characteristic of these investment models appears to have become impact, rather than the geography of deprivation, or the anatomy of the social sector. This shift in emphasis is subtle but important. Twenty years ago, in October 2000, Sir Ronald Cohen wrote a letter to the then chancellor of the exchequer, Gordon Brown, as an introduction to the first report of the Social Investment Taskforce. In the final line of the letter, Sir Ronald describes "a new approach and a far-reaching programme to improve dramatically the prospects of underinvested communities". Ten years later, as the Social Investment Taskforce published its final report in 2010, Sir Ronalds closing line to his introduction describes ten year of "developing new approaches to improve the difficult lives of those whom rising national prosperity has not helped." It is striking how, both 10 and 20 years ago, Sir Ronald was focused on the underinvested and those who had been `left behind. In 2020, as the idea of the `left behind has come to the fore, it seems timely to ask where social investment has gone.

LT-21-11-Levelling-the-land.pdf - page 8/31 - The need

The need

LT-21-11-Levelling-the-land.pdf - page 9/31 - An Institute for Fiscal Studies (IFS) re…

An Institute for Fiscal Studies (IFS) report of October 2020 considered evidence on UK regional inequalities and looked at some of the existing programmes aimed at targeting resources to `left-behind places � defined as places with broad economic underperformance, which manifests itself in low pay and employment, leading to lower living standards in that area, as well as poor productivity and a low skill base (Davenport and Zaranka, 2020).The IFS found that:

LT-21-11-Levelling-the-land.pdf - page 10/31 - A range of research into addressing spat…

A range of research into addressing spatial inequalities is focused on the way that transport challenges and solutions can make the difference. Centre for Cities � unsurprisingly focused on cities � argues that addressing "poorly performing transport networks in cities plagued by the worst congestion" could help to close the productivity gap between cities in the North and Midlands and those in the South to `level up the national economy (Edgar, 2020), while also arguing against spreading transport investment too thinly, thereby focusing on a handful of core cities (Jeffrey and Enenkel, 2020).

LT-21-11-Levelling-the-land.pdf - page 11/31 - The report considered previous initiativ…

The report considered previous initiatives to invest in these areas and concluded that investment to help overcome these challenges has tended to be much more successful where it has harnessed local knowledge and trust, offered flexibility, and fostered social capital, ownership and responsibility at a community level. The research argued that emerging models of local economic development can be built upon the principles of long-term investment; rooted in the particularities of place; investing in social capital and social infrastructure; encouraging partnership; supporting asset creation; and targeting need and community control.

LT-21-11-Levelling-the-land.pdf - page 12/31 - The social investment response

The social investment response

LT-21-11-Levelling-the-land.pdf - page 13/31 - Proportion of deals

Proportion of deals

LT-21-11-Levelling-the-land.pdf - page 14/31 - What is the link between social investme…

What is the link between social investment and `left behind areas?

LT-21-11-Levelling-the-land.pdf - page 15/31 - Model

Model

LT-21-11-Levelling-the-land.pdf - page 16/31 - Model

Model

LT-21-11-Levelling-the-land.pdf - page 17/31 - The lessons

The lessons

LT-21-11-Levelling-the-land.pdf - page 18/31 - renewable energy to thousands of homes. …

renewable energy to thousands of homes. The community intends to use profits from the turbine to help fund a development plan for the local area, including a �1.7m community hub providing training, social support and debt advice (BBC, 2020).

LT-21-11-Levelling-the-land.pdf - page 19/31 - Tim from the West Midlands Tim Evans in …

Tim from the West Midlands Tim Evans in the West Midlands already has some experience of "DIY social investment" when a bakery business he knew issued "bread bonds" to buy equipment and raise tens of thousands of pounds very quickly and with little paperwork. He has also seen social investment work with a big charity and likes the idea. He describes how investment models might create a long-term, sustainable asset for the community � a sort of hyperlocal sovereign wealth fund. But for smaller, riskier projects, Tim is not so sure. Maybe it could work for the local bike shop, a social supermarket or a housing project. But he also has hesitations and sees limitations. Making a business work in a tough community is hard already. Does the community really have the expertise? What would the right investment product be? Is debt really appropriate? Tim also thinks that social investment needs demystifying, the jargon is baffling and there are cultural barriers. Tim wants to see finance that is a bit more attuned to the local conditions. In particular, that recognises how the pace of change can be slow,"were talking 10 years, 15 years or more," he says,"because thats how long it takes!"

LT-21-11-Levelling-the-land.pdf - page 20/31 - Emerging US models

Emerging US models

LT-21-11-Levelling-the-land.pdf - page 21/31 - Social investment: Financial return?

Social investment: Financial return?

LT-21-11-Levelling-the-land.pdf - page 22/31 - Finance Only Finance First

Finance Only Finance First

LT-21-11-Levelling-the-land.pdf - page 23/31 - Conclusion

Conclusion

LT-21-11-Levelling-the-land.pdf - page 24/31 - Community Wealth Building

Community Wealth Building

LT-21-11-Levelling-the-land.pdf - page 25/31 - 2. Designed to create the right incentiv…

2. Designed to create the right incentives:

LT-21-11-Levelling-the-land.pdf - page 26/31 - Until now, those social investors which

Until now, those social investors which

LT-21-11-Levelling-the-land.pdf - page 27/31 - Bibliography

Bibliography

LT-21-11-Levelling-the-land.pdf - page 28/31 - Futurebuilders England Fund. Social Inve…

Futurebuilders England Fund. Social Investment Bunsiness (SIB). https://futurebuilders.socialeconomydatalab.org/

LT-21-11-Levelling-the-land.pdf - page 29/31 - Quarterly Dashboard to 30 June 2020: Gro…

Quarterly Dashboard to 30 June 2020: Growth fund. Access - The Foundation for Social Investment (2020), https:// access-socialinvestment.org.uk/wp-content/uploads/2020/09/Quarterly-Dashboard-Q2-2020-2.pdf

LT-21-11-Levelling-the-land.pdf - page 30/31 - 28

LT-21-11-Levelling-the-land.pdf - page 31/31 - About Local Trust

About Local Trust