Make social care an economic ‘engine’ of the West Midlands

Press release for our inclusive economics & social care report with New economics Foundation – launched today

Social care may be on the brink of crisis but the sector has the potential to become a driver of the West Midlands economy.

A report for Localise West Midlands as part of the Good City Economies programme, has called for a re-framing of the sector, away from large-scale providers towards community and cooperative care models.

Prioritising and promoting community-scale care provision could transform the sector, creating high quality jobs and improving standards of care across the region.

Following calls by the new mayor of West Midlands Andy Street for greater diversity in the provision of all public services, this timely report sets out the benefits of a more localised social care system.

The report, Social Care as a Local Economic Solution in the West Midlands, was scoped by a group of organisations active in the region on inclusive economics and social care.

Social care is a ‘dysfunctional system dominated by “too big to fail” companies’, the report says. For while the ‘big five’ care providers appear to offer lower costs, almost a third of their spend goes to shareholders.

Data cited in the report shows that the UK’s five biggest chain social care companies offer big returns to investors, taking up 29% of their costs —the second-biggest drain on expenditure after staff wages.

It calls for the West Midlands Combined Authority (WMCA) to prioritise new models of care and establish a community care innovation unit.

Community-led care providers tend to keep money in the local economy and offer more personalised care for the same cost. A regional ecosystem of smaller-scale care businesses, such as West Midlands-based Crossroads Care, could ensure public investment in social care is re-invested in communities.

This re-framing of social care models a new approach to local economics, one that is aligned with the assets and needs of communities rather than focused on economic growth and inward investment. This ‘foundational’ approach to local economies could be extended to other sectors such as housing, food and utilities.

David Powell, subject lead at the New Economics Foundation and author of the report, said, ‘Social care is on a cliff-edge. New ideas are desperately needed. The West Midlands can transform the perception of the care sector in the region: a growing economic sector with the potential to meet a diversity of skills, employment and economic needs for communities that aren’t helped by GVA-driven economic strategies.’

Localise West Midlands, who commissioned the report said: ‘The West Midlands coordination role and the election of its first Mayor – who has committed to not-for-profit models of public service provision – places it in a unique position of leadership.

‘The region has an opportunity to be visionary if it understands how sectors like social care can provide careers in places where people live meeting local needs. To deliver its commitment to inclusive prosperity the WMCA will need strategies like this based on real local needs and assets, and to create an economy in which we all have an ownership stake.’

 

Notes:

Social Care as a local economic solution for the West Midlandsis part of the Good City Economies project, a partnership between New Economics Foundation and Centre for Local Economic Strategies, with funding from Friends Provident Foundation.

Localise WM works towards local supply chains, money flow and ownership for a more just and sustainable economy and will be focusing on policy opportunities such as this at the regional level over the coming years. Its work on this has been funded by the Barrow Cadbury Trust.

Download the report here

 For more information contact:

 Author and primary contact:

David Powell: David.Powell@neweconomics.org

 Co-ordinator of Localise West Midlands:

Karen McCarthy: karenm@localisewestmidlands.org.uk

@localisewm 0121 685 1155

Good City Economies: @GoodCityEconomy

 

Notes:

Localise West Midlands: http://www.localisewestmidlands.org.uk

Good City Economies: https://newstartmag.co.uk/good-city-economies/

Localising new-build housing

Architect and writer Clive Aslet (left) writes about a development of 4,000 houses on 500 acres – houses, small apartment blocks, schools, surgeries, mixed income housing, shops, business premises and leisure facilities and green spaces – on the edge of Newquay. There is an emphasis on local labour, materials and procurement.

“How society chooses to house people is every bit as important as how it chooses to feed people,” says Tim Gray, estate surveyor and chief of operations “If you can get those two things right, you will be happier, healthier and better able to engage socially. the ambition is to build community and engender civic pride, to live so that you can meet your daily needs conveniently on foot, not to differentiate between homes of different tenures, and to be connected socially with the adjacent settlements — this should provide good foundations for deciding how the nation should build homes in the future. There really is an alternative.”

Aslet describes a number of features:

  • a core commitment to spend the money in Cornwall, using local labour and materials and a pattern book with typical Cornish vernacular details, e.g. roofs are made from Cornish slate from a nearby quarry
  • The plans include setting up a town farm in some listed buildings to provide food for residents of the development.
  • There will be mixed-use neighbourhoods, in which the car is subservient to the pedestrian.
  • There will be a community orchard, allotments and ‘edible gardens’.
  • Low-cost rented homes are scattered among the more expensive owner-occupied ones 30% of the housing is affordable.

The area has been given a new lease of life. The quarry provides jobs, and so do the builders responsible for the work — all firms are from the southwest, whose work not only requires local labour, but also helps to establish local supply chains. They form what Gray calls a “consortium” a method that ensures the architecture is practical and appropriate for the local market.

Newquay is poor and homes are particularly needed by young people. Judging from conversations with a number of people in their twenties and thirties and young families met in the area, they like the designs, the edible gardens (herbs and fruit bushes are planted next to houses), espaliered pear trees and bee bricks (bricks with holes laid into the eaves of houses to welcome threatened bee populations), they’re all part of the philosophy — as well as local style, local materials and local employment . . . local food.

This is symbolised by the community orchard. seven acres of land that has been turned into allotments. “Trespassers will be composted”, reads one of the signs. Orchard and allotments are visible signs of the local food web that is being encouraged. They’re also somewhere that people from the new housing can meet long-time Newquay residents.

As Tim Gray said, this should provide a good foundation for deciding how the nation should build homes in the future. There really is an alternative: Aslet sees it as the beginning of a movement that made Britain better to live in.

 

 

 

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Can you help us to inspire and catalyse a better economy?

Can you help us to inspire and catalyse a better economy?

Join LWM’s board

We know our work towards localising and redistributing prosperity resonates with a lot of people. We’d love some of that resonance to draw people to get involved in governing our future – the small but crucial ‘lynchpin’ organisation in the region’s progressive economics!

After the summer we will be embarking on a fourth phase of our Localising Prosperity programme, which came from our groundbreaking research into the benefits of a localisation approach and how it can be integrated into mainstream economic development. We are now focusing on delivery of this agenda in practice. The main strands of work will be:

  • Maximising the local benefits of the new hospital development in Smethwick, including with partners through the EU-funded USEIT project
  • Enabling more of a voice for economic justice organisations into the Combined Authority agenda
  • Supporting and challenging regional and local economic agendas to go beyond ‘growth’ to ‘who benefits’.

We will also be putting some time into diversifying our activities and will be planning for this over the summer.

To help refresh and strengthen our thinking we’re looking for two new active, committed board members with commitment to our concept and values, understanding of the tactics and communication for effecting change, and relevant knowledge and contacts.

We are also very aware that the age, ethnicity and gender profile of our board does not reflect the population of the West Midlands, and we are keen to address this in order to benefit from a wider range of perspectives and ensure we do not inadvertently exclude anyone from our group. So we particularly welcome applications from women, younger people, and people from a variety of cultural, ethnic and social backgrounds.

Please read our Board member role description and browse our website for more information. If you’re interested, please email us outlining how you meet the above criteria and why you are interested in getting involved, attaching your CV. We’ll then be in touch to arrange a meeting.

Please also pass this on to contacts who could be interested!

Karen Leach

International Alliance for Localization: Local Futures

In the Times, Ed Conway, economics editor of Sky News, describes problems arising from the complexity of globalisation, ‘the hallmark of 21st-century life’ and the International Alliance for Localization records examples of new modes of development and progress. He concludes: “Globalisation, once a means of boosting everyone’s income, has instead evolved into an excellent vehicle to help the rich get richer”.

The International Alliance for Localization sees that the building of more resilient economies will require a rethinking of the financial system, and its Planet Local series has been turning the spotlight on some inspiring examples of ethical banking:

* In Maine, USA, a local resident with money to invest  is providing nearby small farmers with loans whose interest is paid exclusively in the form of farm products.

* Brazil’s Banco Palmas, governed and managed by residents of the impoverished Palmeiras neighborhood in the city of Fortaleza, has issued a local currency, dramatically shifted spending patterns to keep money circulating locally, and extended basic financial services to people shut out of the mainstream banking system.

* In Croatia, the democratically-owned Ebanka functions as a non-profit bank, in stark contrast to most financial institutions worldwide. Their loans are given without interest, and every member has an equal voice when it comes to voting on big decisions, regardless of the value of their deposit.?

Visit IAL’s growing library of localization initiatives

 LWM is a member of IAL, a cross-cultural network of thinkers, activists and NGOs from 58 different countries.

 

 

 

 

FT: American executives turn away from globalisation towards a more localised world

Last month the Financial Times’ Gillian Tett met Inge Thulin, the Swedish-born chief executive of 3M, an American conglomerate at the Council on Foreign Relations in New York (below).

She reports that – though 60% of its revenues and 40% of 3M’s workforce are outside American shores – Mr Thulin, when discussing corporate strategy, prefers to talk about “localisation”:

“Our strategy has changed. If you go back [several] years, there was a strategy of producing at huge facilities at certain places around the world, and shipping it to other countries. But now we have a strategy of localisation and regionalisation. We think you should invest in your domestic market as much as you can.”

Instead of “free” trade, American executives are now calling for “fair” trade, along with “reciprocity” and “equalisation” of trade deals.

When Donald Trump started talking about restoring US manufacturing last year, he tapped into a subtle trend that was already emerging. As the West Midlands Producers’ site noted, the reshoring trend, successes and possible pinch points, have been systematically explored and publicised by Aston University’s Professor David Bailey since 2013; two years it quoted Professor Dr Michael D. Johnson, Department of Engineering Technology and Industrial Distribution, Texas A&M University, briefly in the FT:

“My colleagues and I have found that importing goods from China to developed countries (for example, the US) entails numerous increased costs: transportation, inventory carrying, and production and logistics oversight. The combination of these increased costs, just-in-time manufacturing needs, and increased developing country labour rates contribute to the economic viability of localised flexible manufacturing facilities serving developed country markets”.

Ms Tett recommends a survey of US companies conducted by the Boston Consulting Group which showed that as recently as 2012 American companies were busy building cross-border supply chains, 30% with China – but 31% in 2015 planned to boost production in America and only 20% in China.

  • One reason for this shift is a rise in relative wage costs in China.
  • Another is that production costs in the US have fallen because of automation and cheap energy.
  • However, a third point is that chief executives have realised that long supply chains create political and logistical risks.

“The days of outsourcing are declining,” Jeff Immelt, General Electric chief executive, observed late last year. “Chasing the lowest labour costs is yesterday’s model.” even before Mr Trump arrived in office, the C-suite (slang: important senior executives) was losing its blind faith in globalisation. For better or worse, we face a more localised world”.

 

 

 

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A regenerative ‘Circular Economy’ includes more localisation of economic activity

The Circular Economy is advocated to replace and address the social and environmental damage done by the current ‘Linear Economy’ with its ‘take, make, dispose’ model, depleting finite reserves to create products that end up in landfill or in incinerators. It achieves its objectives through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling – reducing waste to zero. Some examples of such practice are presented on the website of the World Economic Forum.

The idea of circular material flows as a model for the economy was presented in 1966 by an economist, Professor Kenneth Boulding, in his paper The Economics of the Coming Spaceship Earth.

In the 70s, Walter R. Stahel, architect, economist and a founding father of industrial sustainability, worked on developing a “closed loop” approach to production processes. He co-founded the Product-Life Institute in Geneva; its main goals are product-life extension, long-life goods, reconditioning activities, waste prevention, advocating “more localisation of economic activity”.

With Genevieve Reday, he outlined the vision of an economy in loops (or circular economy) and its impact on job creation, economic competitiveness, resource savings, and waste prevention. Their Hannah Reekman research report to the European Commission, “The Potential for Substituting Manpower for Energy” (1976) was published in 1982 as a book (left) Jobs for Tomorrow: The Potential for Substituting Manpower for Energy. 

The Waste & Resources Action Programme (WRAP) a charity, which receives funding from the Department for Environment, Food and Rural Affairs, the Northern Ireland Executive, Zero Waste Scotland, the Welsh Government and the European Union was set up in 2000.  From its headquarters in Banbury it works with businesses, individuals and communities to achieve a circular economy through helping them to reduce waste, develop sustainable products and use resources in an efficient way. Below: the header for its March report:

On 17 December 2012, the European Commission published a document entitled Manifesto for a Resource Efficient Europe. This manifesto clearly stated that “In a world with growing pressures on resources and the environment, the EU has no choice but to go for the transition to a resource-efficient and ultimately regenerative circular economy” and outlined potential pathways to a circular economy, in innovation and investment, regulation, tackling harmful subsidies, increasing opportunities for new business models, and setting clear targets.

‘Resource’, the first large scale event for the circular economy was held In March 2014 and Walter Stahel joined the programme of 100 business leaders and experts. Many major stakeholders and visitors from across the globe attended. An annual large scale event is now increasing the uptake of circular economy principles. Circular Economy Examples may be seen on the website of the World Economic Forum and there are indications that some multinational companies may be cherry-picking related ideas which cut costs and increase profits.

Some will have reservations about the involvement of McKinsey & Company, which has issued two reports on the subject – one commissioned by the Ellen MacArthur Foundation.

Peter Day explored the work of the Ellen MacArthur Foundation and its associates on radio (In Business) on 23rd April 2015 – listen again here.

Ellen established this independent charity in 2010 and eloquently outlines the economic opportunity of a circular economy, giving the concept wide exposure and appeal.

 

 

 

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Localising moves in four Eastern European countries

The Romanian parliament has passed a law requiring large retailers with a turnover of 2m euros to allocate a minimum of 51% of existing space for fresh produce to products sourced locally, from a short supply chain.

The law, which came into effect last month, initially stated that products should come only from Romania but had to be amended after Brussels warned that this would be a breach of EU regulation. Under the amended text, Bulgarian and Hungarian products would also qualify as part of a short supply chain.

roamiancoop

French retailer Carrefour has founded an agricultural co-operative in a Romanian village to bring local fresh produce to its shelves. It includes 80 families of producers who own 60 hectares of agricultural land. Carrefour will source 5,000 tonnes of fruit and veg from the local co-op in the village of Varasti.

Through the co-op, which officially launches this month, farmers will be able to scale up production and have a single collection centre. The partnership with Carrefour guarantees them a production plan and price, and means they will receive fast payments for their products.

RetailEU described the legislation as protectionist but added that Romania is not the only country concerned about its local manufacturers; Slovakia  wanted to force supermarkets to inform customers at the entrance of the number of Slovakian products in the store and recently the Polish government introduced a “supermarket tax” on all major (and therefore foreign) retailers, as Hungary has already done.

 

 

 

Are the region’s schools and hospitals sourcing food locally?

BBC Scotland made freedom of information requests to all 32 Scottish councils about the sourcing of food products bought last year.

Despite campaigns by the Scottish Government to buy local produce. Of the 28 authorities which responded, it was found £1.3 million was spent on chicken products from Thailand, more than £125,000 on carrots from Belgium, £125,000 on mashed potato from France and almost £12,000 on raspberries from Serbia.

scottish 2food        Read more about Scottish food here: http://www.taste-of-scotland.com/foodproducers.html

Farmers said they want to see more done by councils to source local produce and  the Scottish Greens first raised the issue of councils buying chicken from Thailand in 2013.The party’s health spokeswoman Alison Johnstone said:

“It’s disappointing that, three years on from our investigation, this remains a problem. Our economy is losing out. Government food policy remains too focused on exports rather than supporting local procurement. Councils need support so they can buy Scottish more often.”

A review of food and drink nutrition in schools is now under way. John Swinney, the education secretary, said that he wants school food to be “sourced as locally as possible” and has asked experts from Food Standards Scotland, NHS Health Scotland and Education Scotland where provision can be improved.

LWM is working with a number of partners to promote this agenda.  While the Carter Review of 2015 put obstacles in the way of localising NHS procurement, with its insistence on frameworks and catalogues, it recognised the value of locally sourced food.  County Hospital, Stafford was one of the first to gain a gold Food for Life Catering Mark, an initiative of the Soil Association recognised by NHS England.  This experience is being passed on through the West Midlands NHS Sustainability Network.

The fragmentation of the schools system means it’s less clear how many schools are following this approach, though many are growing their own salads and fruit as part of healthy eating projects.  In Smethwick, Victoria Park Academy has its own social enterprise, Ballot Street Spice, and it’s hoped they will sell their spice mixes at the Midland Met Hospital food market when it opens.  The Department for Education has recognised the Food for Life Catering Mark, and the government plan for Procurement cites it as a best practice tool.

 

 

Event: launch of post Brexit & Trump report commissioned by MEP

The Brexit vote and the election of Trump have been hailed as marking the reversal of the long trend towards increased globalisation.

These changes possibly also mark the end of neoliberalism as the dominant ideology of our times. For opponents of what globalisation and neoliberalism have meant in practice these developments might be seen as welcome. Yet at the same time Brexit and Trump seem highly problematic for anyone concerned with social justice and ecological sustainability.

green house header

A new report by Green House authors Victor Anderson and Rupert Read, commissioned by MEP Molly Scott Cato will be launched on Tuesday 28 March from 14.00 – 16.30 at Europe House in central London.

The report considers the impact of the UK’s withdrawal from the EU on trading practices and the opportunity to move to a less globalised and more localised economy. It emphasises that there are many different versions of Brexit, and aims to put a green version firmly on the political agenda.

Note: Panel discussion with Nick Dearden (Global Justice Now) and Helena Norberg-Hodge (Local Futures and International Alliance for Localisation of which Localise West Midlands is a member). Helena’s contribution will be by pre-recorded video due to prior commitments.

 

Register and get full details here.

 

 

 

Changing local economies to work for people who feel excluded

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A link has been received to a Guardian report about the ‘Preston model’ – for background information see Clifford Singer’s interesting article on the Next System Project’s website.

Councillor Matthew Brown, Preston city council cabinet member for social justice, inclusion and community engagement, devised this model. 12 of the city’s key employers were helped to reorganise their supply chains and identify where they could buy goods and services locally, stopping 61% of their procurement budget being spent outside the Lancashire economy. The employers included ‘anchor institutions’ such as:

  • the county constabulary,
  • a public sector housing association,
  • colleges
  • and hospitals

Since 2011, Lancashire council’s central government grant had been reduced from £30m to £18m, leading to cuts in everything from community engagement to parks and the leisure centre. “The intention was to devolve cuts and blame it on us,” Brown says. “But you can become more self-sufficient.”

The Public Services (Social Value) Act 2013 now allows public bodies in England to take into account the social, environmental and economic impact of their commissioning. A key step was to redirect lucrative contracts, such as printing services for the police and food for council buildings, towards local business and the city council doubled its procurement spending with Preston companies from 14% in 2012-13 to 28% in 2014-15.

Brown and his colleagues want to build a city where workers are in control of wealth, improving people’s sense of citizenship. “We’ve got the public pension fund to invest in student housing, we’re looking at setting up a local bank to give business loans and for the local authority to become an energy provider,” he says. “You put all that together and you can see how we are developing the infrastructure for a new economy.”

The model was inspired by cooperatively run communities in Cleveland, Ohio and the world’s largest co-operative group, Mondragón, in the Basque region of Spain, and has been cited in speeches by the shadow chancellor John McDonnell and other councils, including Birmingham, Rochdale and Sheffield have taken an interest in the initiative.

Matthew Brown has worked with the Centre for Local Economic Strategies, a Manchester-based think tank with considerable experience of working collaboratively with local authorities and other institutions to boost local economies.

CLES is  working in Birmingham with Localise West Midlands because for many years LWM has made the case for more inclusive, ‘locally grown’ economies – see its ground-breaking report, Mainstreaming Community Economic Development. The focus is on those ‘anchor institutions’ which have a major impact on the city.  As part of a separate initiative, LWM is working with the New Economics Foundation, CLES and New Start. They have brought together a group of local practitioners from the region which has suggested a focus on health and social care. Read on here.

Brown believes that as a result of the financial crisis and its aftermath people are ready to hear a radically different way of thinking about politics and that Corbyn can win a Labour party victory in 2020. Until then, Preston is backing the northern powerhouse initiative to secure devolution, allowing it to build what Brown believes are the foundations of a new economy away from the City and Westminster.

“The days of getting huge inward investments are over, so the sensible way is looking at how you can do that through your local area to make something new,” he says. “This is it.”