There has been increasing interest in revamping our economic systems to better support individual and collective health and wellbeing and distribute wealth more evenly, while doing more to protect the planet. In today’s post, recently-appointed VicHealth (@VicHealth) postdoctoral research fellow Melissa Kennedy of Deakin University (@DeakinSeed) explains what Community Wealth Building (CWB) is and how a recent Masterclass in the Victorian Goldfields region explored its transformative potential.

Strengthening community prosperity in a new ‘gold rush’

The adage ‘whoever holds the gold, makes the rules’ found new meaning at a recent Community Wealth Building (CWB) masterclass in Castlemaine, Central Victoria. The masterclass brought together participants from Victorian Goldfields councils and economic development practitioners to consider how Community Wealth Building could be harnessed as part of the UNESCO World Heritage bid for the Victorian Goldfields region to maximise economic benefits for the region and its workers and communities. With the prospect of an increase in regional income by year 10 estimated at $150 million from the designation and investment that could follow, the masterclass focused on how Community Wealth Building could support local councils, businesses, workers and communities to leverage a greater share of legacy economic benefits from a new tourism-induced ‘gold rush’ and thereby trap and share the wealth from existing and new investment in the region.

*The Goldfields Community Wealth Building masterclass listens to Neil McInroy. Photo credit: Melissa Kennedy.*

The Community Wealth Building masterclass was co-led by Patrick Fensham, SGS Economics and Planning, who provided data insights on the region, and Neil McInroy, visiting Community Wealth Building expert (adviser to the Scottish Government on CWB and Global CWB lead for ‘The Democracy Collaborative’, a US-based think tank); and included guest contributions from Melina Morrison (CEO of the Business Council of Co-operatives and Mutuals) on the ‘power and potential of cooperatives’ and Tara Callinan, SGS Economics and Planning, on recent work supporting the development of Traditional Owner economies.

What is Community Wealth Building?

Community Wealth Building, or CWB, is a rapidly growing global practice of socially just and sustainable economic development that vastly departs from conventional economic development strategies privileging ‘footloose’ external investment. At its core, CWB focuses on leveraging local assets and capital (e.g. physical, financial and human), wrapping them around a supportive ecosystem that funnels wealth locally, thus strengthening community resilience in response to challenges.

Key challenges for the Goldfields region identified by masterclass participants included:

a critical shortage of affordable and secure housing,
a lack of skilled workers,
under/over tourism,
limited resourcing,
uneven social and demographic change, and
the need for more robust partnerships amongst new local economic development actors such as renewable energy providers.

*Community wealth building can mean big community-owned projects, like clean energy cooperatives. Photo credit: Photo by* *JOHANNA MONTOYA* on *Unsplash*

As Neil McInroy observed, these challenges have global resonance and are symptomatic of an economic system where the root causes are never properly addressed (e.g. wealth inequality) leading to an ‘endless situation of problems'.

The CWB model works to leverage capital in the interests of local people, place and planet through a focus on 5 core pillars: inclusive ownership, finance, workforce, spending, and land and property. This is done through, for example, amplifying inclusive ownership (e.g. social enterprises); strengthening local financial systems (e.g. community banks); improving working conditions (e.g. fair work charters); bolstering local spending (e.g. a commitment to local procurement); and widening community access to land property (e.g. community land trusts).

Critically, this model has delivered tangible successes. CWB has shown strong economic and social returns. In Preston, England, a ‘laboratory for CWB’ and recognised model, the share of expenditure of six anchor institutions captured in the Preston local area grew from 5% to 18.2% (or by nearly £74 million), and from 39% to 79.2% (almost £200 million) in the wider Lancashire County area from 2012/2013 to 2016/2017. In Scotland, a range of positive health impacts from CWB were found, including reduced income inequality, improved working conditions and enhanced community resilience.

Identifying and Scaling Up Community Wealth Building in the Victorian Goldfields

Many Victorian Goldfield councils are leading the way in driving more socially just economic development. For instance, Mount Alexander Shire’s recent Economic Development Strategy has a strong emphasis on CWB and broader Wellbeing Economy principles. The Strategy forefronts the importance of healthy people and ecosystems in the development of the Shire and is grounded in strong engagement with the local First Nations community. Golden Plains Shire is seeking to embed Community Wealth and Wellbeing Principles in its ‘Growing Places’ Strategy, to ensure planning and development can deliver on social and sustainable infrastructure, e.g. affordable housing.

Presenting the region’s economic data and indicators through a CWB lens, Pat Fensham provided a profile of Goldfields LGAs, including key areas of economic leakage (i.e. total spending imported outside the region). The important role of councils and other public sector entities as ‘anchor institutions’ for capturing and growing community wealth was highlighted, with potential for an extra $44 million and 269 jobs to be added to the Goldfields region every year if councils were able to direct an additional 5% of their expenditure to local economies by working with businesses and suppliers on a progressive procurement agenda.

With its focus on collective ownership and community benefits, cooperatives are central to CWB. Melina Morrison highlighted numerous examples of cooperatives in the region that capture wealth locally and build local resilience. Cooperatives in the health and medical industry categories in the Central Goldfields region turn over more than $195 million. By definition surpluses from this expenditure stay with employees or are reinvested for local benefit. Renewable energy provider Hepburn Wind was highlighted as a pioneering local cooperative enterprise. Renewable energy in general was identified as a key area for communities to have a greater stake, with Melina discussing how the cooperative model provides a powerful way for communities to engage with renewable energy companies as a legal entity. Castlemaine Community Investment Coop is a burgeoning Central Goldfields cooperative directly championing CWB principles by working to stem the loss of community infrastructure to commercial interests.

As an essential building block for CWB in the unique Australian context, Tara Callinan’s presentation on the Victorian Traditional Owner Economic Development Roadmap pointed to the structural and systemic challenges that First Nations communities face in an unlevel economic playing field, and how it aims to help unlock self-determined growth of the Victorian Traditional Owner economy.

What to do on Monday?

In response to Neil McInroy’s provocation on devising next steps for actioning CWB in the Goldfields region, masterclass participants identified a range of focus areas, including:

addressing procurement barriers (e.g. limitations on suppliers on council systems)
working with the private sector to unlock physical assets such as property
greater understanding of the role of cooperatives in economic development
broader awareness of where wealth is held in communities
seeding and supporting the growth of cooperatives (e.g. Council facilitated ‘Cooperatives Day’)
understanding how Council can take a share in assets for the benefit of the community
more education and awareness of councils’ role as anchor institutions.

The UNESCO Goldfields presents a timely opportunity to scale up CWB in the region. The masterclass concluded by considering the need for Victorian Goldfields World Heritage Master Plan to include ‘build community wealth’ as a key principle. For as Neil McInroy pointed out, ‘what are economic development strategies for, if not for building community wealth’?

Melissa Kennedy was recently awarded a VicHealth Postdoctoral Research Fellowship. Dr Kennedy’s project will support Mount Alexander Shire’s Economic Development Strategy by investigating how the wellbeing economy goals can be aligned and enable economic systems-change to improve wellbeing. Her views may not reflect the position of VicHealth.

Posted by Susan Maury (@SusanMaury)