Power to Change, the support charity for UK community business, has issued a report with 10 key lessons in using the social economy to drive local growth.
The report, Lessons in Local Growth, comes after the Labour government made strategic authorities a key part of its plans for national economic growth. Keir Starmer has asked metro mayors to produce Local Growth Plans for their regions – and Power to Change says that alongside boosting high growth industries these growth plans “provide a timely opportunity to create inclusive growth, by working with organisations in the social economy – like community businesses, co-operatives and social enterprises”.
It added: “The social economy plays a vital role in ensuring prosperity is shared across communities, particularly in disadvantaged areas,” and says its report sets out 10 practical lessons to guide strategic authorities wishing to harness the potential of the social economy within their growth strategies.
The report calls for a more holistic approach to economic development – one that boosts productivity, raises living standards and tackles inequalities across the UK’s regions.
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“Recent shocks, such as the Covid-19 pandemic and the cost-of-living crisis, have exposed the limitations of traditional economic models for addressing regional deprivation,” added Power to Change. “Lessons in Local Growth calls for a shift towards progressive strategies that integrate businesses in the social economy – including community businesses, social enterprises, co-operatives, and trading charities – into local economic planning.”
Deputy CEO Nicola Steuer said: “Regional authorities looking to unlock growth in ways that benefit all communities and the places in which they live can achieve this through building their social economy.
“Through our regional partnerships, we’ve supported strategic authorities to grow and strengthen their local social economies and build collaborative partnerships with social economy organisations such as community businesses, social enterprises, co-operatives and mutuals, and trading charities. This report shares what we have learnt.
“We hope it is useful to those looking to embed the social economy in their Local Growth Plans and to everyone working to achieve inclusive growth.”
The lessons range from setting a bold vision for social economy development to leveraging procurement power, drawing on social economy approaches by the West Midlands Combined Authority, North East Combined Authority, and Liverpool City Region Combined Authority.
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“Many of the lessons for local growth set out in this report represent the first-hand experience of our work in the West Midlands,” said Ed Cox, executive director of strategy, economy and net zero at the West Midlands Combined Authority. “With support from Power to Change and a close partnership with local social businesses, our bold ambition to double the size of the social economy and our cluster-based approach is at the heart of how we unlock inclusive growth.
“It is right that strategic authorities, like the WMCA, should ensure that the benefits of the social economy are recognised and supported through local growth plans.”
Cllr Mike Wharton, deputy mayor of the Liverpool City Region, said: “Socially trading businesses play a really important role in the communities they’re part of, and I’m proud that our area is home to so many values-driven, community-focused companies. Their impact is clear across the region – they employ 45,000 people and add around £3bn to our local economy.
“That’s why we’ve teamed up with Power to Change, through Kindred, to put power and resources directly into the hands of people who truly understand their communities – helping them create quality local jobs and bring in millions in extra funding.
“As the only combined authority in the nation committed to levelling the playing field like this, we are proud to see Power to Change highlight our innovative leadership in their new report, Lessons in Local Growth.”
