Published: 30th Sep 2015
Electrical testing
Engineers at Too Good To Waste re-use centre

Wales has a deep tradition for social initiatives, from developing the early model for the NHS to today’s social enterprise industry. But can community participation be the driver of local economic change?

Porth in the Rhondda Valley – once the beating heart of the south Wales mining community – is now the place where carpet tiles from London’s investment banks come to get a second life.

Social enterprise Greenstream has, since 2008, been diverting some of the 90% of carpet tiles that previously ended up in landfill, sorting them and selling them on to households, charities and housing associations. In 2013 the company diverted the equivalent of more than 12 football pitches worth of carpet to be re-used in homes and offices.

One of Greenstream’s neighbours – based near the village of Ynyshir – is Too Good to Waste, which collects and re-sells household items and provides ‘ethical’ house clearances.

Both organisations offer much-needed training and employment in areas that has yet to recover from the closure of the coal pits that provided their economic lifeblood.

But Ellen Petts, founder of Greenstream, believes more could be done to join the dots between her work, the aims of government, and the broader local economy.

She sees huge potential to build a re-use sector in the south Wales valleys. But, while she works closely with local housing organisations, she has struggled to build a partnership with the local public sector, and would like to see a more joined-up approach.

‘It’s about matching the activity of community organisations with the reach of public procurement’, she says.

Building social-public partnerships

Wales is known for its community spirit and strong social networks. From local funding of libraries and miners’ institutes to the early NHS model in Tredegar and today’s social enterprise sector, the desire to participate in community life is a strong feature in Welsh culture. One of the founders of the co-operative movement Robert Owen was born in mid-Wales and the co-operative tradition he founded has enriched and stabilised areas of the country for many years.

Figures from the Wales Co-operative Centre show that the tradition lives on. It estimates the value of the social economy in Wales at £1.7bn, including Wales Water, Welsh housing associations and social enterprises.

Social ventures can be found in every town and village from 4CG‘s action in Cardigan to Indycube’s network of co-working spaces reaching up into the south Wales valleys.

The Welsh government is conscious of its rich heritage of community action and has drawn on it in recent years, in particular through the launch of the Welsh Co-operative and Mutuals Commission. Its report, published in 2014, set out 25 recommendations for making co-operatives the norm rather than the exception, including new finance mechanisms for the development of mutuals and co-ops and efforts to ensure procurement benefits social enterprises and mutuals. The future role of co-operatives in social care provision was acknowledged in the Social Services and Wellbeing Act.

But those working in social economy say that progress on some of the recommendations has stalled and would like more conscious efforts to make the social sector more than a sum of its parts.

During last month’s New Start/NEF event on alternative local economic thinking for the region, delegates called for a more community-centric vision for the local economy, building on its heritage of social action to bring prosperity and hope to areas that are struggling to find a new economic narrative. Delegates called for stronger social-public partnerships in areas such as social care and for a stronger focus on the ‘foundational economy’ in which most people find work.

Picture by Philip Hollis for Future Friendly awards. 24-8-10 CLEANSTREAM CARPETS. Porth. South Wales. Pic shows: Becky Lythgoe, Mark Wilson, Peter Smith and Troy and Vicky in the warehouse
Employees at Greenstream, a carpet re-use business based in the Welsh valleys

The collaborative economy

A report due to be presented to the Welsh Assembly in November and commissioned by the Wales Co-operative Centre will set out a vision for a Collaborative Economy approach, which it hopes will form the blueprint for a new economic and regeneration strategy for Wales.

Author of the report Pat Conaty describes the Collaborative Economy as a way to unite the various strands of the social and co-operatives sectors through collaborative and partnership-focused policies.

‘A step change is needed,’ he said. ‘The concept of the collaborative economy is to get the boats moving in the same direction.’

The report recommends the development of social and community co-operatives in areas such as re-cycling, energy, housing and social care as a focus for economic development and public service reform. In particular it calls for social businesses and co-operatives to be linked together in consortia – enabled by local government – to provide mutual support and help new initiatives get off the ground.

It cites the experience of Emilia Romagna in northern Italy, where the local authorities began working with the co-operative sector in the 1970s to help the development of co-operative consortia in local industries from food processing to construction and social care. The co-operative sector now accounts for more than one third of regional GDP and has been a stabilising factor in the regional economy.

The Collaborative Economy report highlights the emergence of public-social partnerships across Wales in recent years, particularly in the area of housing.

In 2012 the Welsh government joined forces with local housing organisations to pilot new co-operative and mutual forms of housing, with eight projects identified. Co-operative housing has now been included in a number of developments across the country including the West Rhyl community land trust.

The development of social financing is needed to make the collaborative economy a reality and the report calls for a joint strategy to expand CDFIs in Wales and a mutual housing fund for the country.

Conaty believes the opportunity is there for Wales to transform its local economy through the development of social and co-operative networks and businesses. Since the recession the number of new co-operatives in the UK has grown by 26%, but despite their English and Welsh roots, co-operatives are accounting for much higher levels of GDP in European countries outside the UK.

A drive towards greater collaboration between social enterprises, co-operatives and the public sector could see the UK, and Wales in particular, take back its position as a pioneer of community and co-operative action at the heart of local economies.