When it comes to inequality, the UK is the fifth most unequal country globally, with 44% of its wealth being owned by just 10% of the population. This percentage is five times what is held by the poorest half. Sadly, more than half of the Uk's population lives below the poverty line, although most people are working regular jobs.
What is community wealth building?
The heart of community wealth building is to connect people with the places that create wealth to reduce this poverty gap. In fact, community wealth building is against the current economic model since it puts the accumulation of private wealth and profit above other people's basic needs. To effectively do this, there are five strategies a community can employ. These strategies were developed by CLES, the national organization for local economies.
1. Plural ownership of the economy
The challenge here is the gap between the rich and the poor. As mentioned below, the UK has the fifth largest gap globally, which means most people live below the poverty lines. It also means that the wealth workers generate does not flow back to them but is held by a few individuals.
The solution is to form locally owned and socially-minded enterprises. These enterprises will employ, buy, and invest locally then use and invest resources within the community. As a result, even the workers will feel the benefits and hold some of the resources.
2. Making financial power work for local places
Most small businesses use credit as their lifeblood since they would find it difficult to work and compete fairly in the market. However, in the UK, the banking system uses global rates instead of local rates. This makes it difficult for small businesses to access credit.
The solution is to help these small enterprises access national and international capital by harnessing the wealth found locally. As a result, investors will still get great returns, and the community will benefit.
3. Fair employment and just labor markets
Most people in the UK aren't sure how secure their jobs are due to the rise of in-work poverty and zero-hour contract. There is also an erosion in employment which makes it that much harder to secure jobs.
CLES says that the solution is working with human resources within anchor institutions to strengthen the economy through employment. This will increase employment opportunities within the community.
4. Progressive procurement of goods and services
Cost is a huge factor in determining who gets a contract, especially in anchor institutions. This disregards important issues like decent employment and social values. However, according to the CLES, community investment partners can promote the progressive procurement of services and goods. They can emphasize the use of social and environmental benefits as well.
5. Socially productive use of land and property
Land and property distribution are key features in the local economy. They are an expression of economic power, which, unfortunately, is owned by a few people. In fact, 30% have no property wealth at all.
Property and wealth should be owned and managed in ways that ensure locals generate wealth. Publicly owned land should have management structures that allow the community to take control of common asses. This is where community investment partners like John C Trando come in.
As a new economic model emerges, offering real solutions to localities and regions will strengthen local economies.
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