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Local economies

‘The opportunities they deserve’

With a new Prime Minister and the promise of a radical new policy agenda, Local Trust’s CEO Matt Leach argues that addressing disparities in social capital needs to be a critical part of any plan to transform the economies of ‘left behind’ areas.

In her speech from the steps of Number 10, Prime Minister Liz Truss set out a vision for her administration focused on aspiration and opportunity, committing to “transform Britain into an aspiration nation, with high-paying jobs, safe streets and where everyone everywhere has the opportunities they deserve.”

She returned to that theme the following day at her first Prime Minister’s Questions, responding to a question by leading member of the APPG for ‘left behind’ neighbourhoods Kieran Mullan MP, saying: “What I will be doing as Prime Minister is absolutely focusing on levelling up, making sure we are attracting the investment and growth into parts of this country that have been left behind so they have their fair share of opportunity”.

The creation of successful economies

Whilst the Prime Minister’s words show that levelling up of ‘left behind’ communities is clearly still an important priority for the new government, we haven’t yet seen the detail of the policy initiatives that will underpin this – something new Levelling Up Secretary Simon Clarke will hopefully be fleshing out over coming days.

It is possible a new government will announce some significant changes in the direction of policy over coming months, including clarity as to the status of some of the commitments made in the Levelling Up White Paper.

But whatever the detail of forthcoming policy pronouncements, the analysis and insight included within the White Paper about the biggest contributors towards the creation of successful economies – for many the strongest part of the document – are going to continue to be important.

And from the point of view of the many ‘left behind’ areas highlighted by the Prime Minister, the White Paper’s emphasis on the importance of action to address disparities in social capital as a key driver of differences in economic potential and performance will be critical.

The fundamental engines of social capital

Local social and civic institutions are the fundamental engines of social capital, and enablers of thriving dynamic community. They not only provide a bedrock for a successful economy, but also a backstop at times of crisis, something seen during the COVID-19 pandemic and more recently in response to the cost of living crisis.

Local social and civic institutions are the fundamental engines of social capital, and enablers of thriving dynamic community.

What is more, at a time when public finances are likely to be under more pressure than ever before as a result of action to address the energy crisis, investing in them pays back, both to HM Treasury in fiscal terms and to local communities in terms of enhanced wellbeing.

But if the importance of social capital and the infrastructure that supports it is now well established, six months on from the White Paper the challenges facing areas where it has fallen into decline remain to be addressed.

Not least that, since 2004, ‘left behind’ areas – the communities who have both highest levels of deprivation and lowest levels of social capital, many located in areas of economic decline in the north of England and Midlands – have received 70% less grant funding than other comparably disadvantaged communities, contributing to a cycle of civic decline which directly undermines the government’s wider ambitions to turn around local neighbourhoods and economies.

Revitalising the economies of ‘left behind’ neighbourhoods

At the same time, we know from our work at Local Trust with Big Local areas, that ‘left behind’ neighbourhoods are places full of people who just need a bit of focused support to turn things around – exactly the sorts of people Liz Truss was talking about when she highlighted how “our country was built by people who get things done … with huge reserves of talent, of energy, and determination.”

Any new package of initiatives aimed at revitalising the economies of ‘left behind’ communities needs to be able to tap that potential.

The Community Wealth Fund campaign, which brings together over 600 local authorities, civil society organisations, funders and local communities, has made the case to government for a significant element of the next wave of dormant assets to be committed to releasing that potential and talent, as a contribution to transforming the lives and economies of our most ‘left behind’ neighbourhoods, something new Culture Secretary Michelle Donelan will be making decisions on later this autumn following the conclusion of the government’s current consultation.

The opportunity is there for her to ensure ‘left behind’ communities are part of the government’s new mission to transform our economy.

Find out more about the government’s Dormant Assets Consultation and how you can take part here >

About the author
Matt Leach

CEO, Local Trust