LWM member Colin Hines has been working with an accountant colleague Richard Murphy on the concept of local bonds and People’s Pensions. People’s Pensions provide a way of local people investing money that would have flowed out of the local economy into distant pension funds to invest instead in a local pension fund that can be used to fund local intrastructure such as a new school building or social housing. Thus a reliable return can be made on pension investment and at the same time local infrastructure can be funded by local people rather than unpopular PFI schemes, with subsequent rents charged being lower than most PFI schemes allow. However, the implementation of the People’s Pensions concept depends on a minor change in legislation. Local Bonds can provide the same benefits but keep the money under Local Authority control rather than putting it in the hands of an independent pension fund.
Recently, Ken Livingston has introduced local bonds for public transport funding in London, and LWM has been encouraging Birmingham to take them up likewise. We have targetted Birmingham because of its particular problems with funding for Social housing renovation: Birmnigham’s social housing stock is in a dire state and requires investment. Tenants’ rejection of PFI stock transfer has left the Council with no easy source of funding, and LWM sees local bonds as a potential solution. Meanwhile many housing tenants and organisations in Birmingham have been focusing on models for greater levels of tenant control of their own housing.
So on 6th November 2004 LWM held a meeting in partnership with Birmingham Cooperative Housing Services, to discuss potential solutions for localising control and financing of social housing in the city. Twenty-five people from key local and regional organisations – including social housing tenant management organisations – were invited to attend, and discussions were held on financing methods such as local bonds and Community Land Trusts, micro-financing such as Sandwell Advice and Money Link Trust, and tenant management systems such as the Preston Gateway. The meeting was funded and supported by Birmingham’s Community Empowerment Network (BCEN).
Feedback from the meeting enthusiastic, with many ideas and action points generated. The partners brought together for the meeting continue to liaise with each other on further developments.
The action points and report of this conference have been sent to participants and other stakeholders, and formed part of the information resource for a further meeting on 2nd April 2005, run by Stand Up for Community Controlled Housing (SUCH) and BCEN. This meeting outlined local control options and funding mechanisms for social housing tenants.
The report is available here.
LWM is now pursuing two particular courses of action following the meeting, firstly as part of the Eastside Sustainability Advisory Group, looking into delivering a sustainable and inclusive housing development in Eastside potentially using a Community Land Trust model as well as tenant management; and secondly investigating opportunities to fund renovation of existing housing estates in other areas of Birmingham using local bonds. This has included talking to council staff and officers, and tenant organisations. Discussions have also been held with the New Economics Foundation on joint work to measure the local multiplier effect of a bond-funded scheme in the future.
An article on People’s Pensions on the Guardian website can be found here. Please note this is an external link.