The role, organisation and contribution of community enterprise to urban regeneration policy in the UK

Abstract

This monograph investigates the organisation, constitution and delivery of community-based organisations which are normally called community enterprises in the UK. These are organisations which emerge from local communities at the neighbourhood level, work in partnership with the public and private sectors, and provide a range of services to meet social, economic and environmental needs. The main focus of the paper is to explore how these organisations contribute to local regeneration strategies, generate social capital and contribute towards the promotion of civil society in general. The main emphasis is on organisations in England and Wales but comparisons are made with the USA and other countries where relevant literature is available. The key questions to be answered relate to the organisation and management of these bodies; the extent to which they engage with and contribute to local regeneration strategies; and the impact they have particularly in acquiring and managing assets. The diversity of the sector, and the range, scale and level of benefits it can deliver is illustrated through five detailed case studies of community enterprises established at different times, in different geographical locations and with different objectives and funding regimes. But, whilst the UK political economy is moving towards less state intervention and more community self-help, the community development corporations in the USA provide an indication of the future direction community enterprises might take in the UK as part of a broad trend towards civic capacity building.

Introduction

Community-based organisations are an increasingly important part of civil society and in many countries they are becoming more assertive in their desire to participate in policy-making which affects their membership. In the United Kingdom (UK) urban regeneration policy has been in a state of flux but a key priority remains to consult, involve and engage different communities, particularly at the local and neighbourhood levels. These initiatives have achieved varying degrees of community ‘empowerment’ and there have been a series of Government policy statements promoting different initiatives and mechanisms for transferring powers down the hierarchy. Over the last decade, community organisations have become better organised and have secured further opportunities to assert influence through, for example, Local Strategic Partnerships, neighbourhood councils and similar forums established by local government at the local level (Maguire & Truscott, 2006). A further noticeable trend has been for community organisations to acquire assets of land and buildings in order to develop these for the benefit of their local communities. These assets may be acquired in a number of different ways, through transfer from central and local government, other government agencies, negotiations through the planning system, or acquisition using grants and loans from a variety of public, private and charitable sources. Evidence is emerging from the UK, USA and other countries that the ownership of these assets brings both benefits and challenges to community organisations which increasingly need to focus on the social, economic and environmental impacts of what they do. Moreover, the growth of this ‘third sector’ is a reflection of the changing political economy of western states after the financial and banking crisis of 2007–2008. In the UK public expenditure has undergone sharp reductions and new mechanisms are being sought to develop many services previously provided by the public sector.

The community sector is extremely diverse and the vast majority of organisations own no assets and are run by unpaid volunteers. Social enterprise is the label normally applied to not-for-profit organisations which operate commercially. Community organisations which acquire assets – the subject of this monograph – are a sub-set of social enterprises but have objectives which relate to a defined geographical area which is often also assumed to be a ‘community of place’. The ways in which these organisations emerge out of communities, promote specific values and aim to deliver local benefits often reflect their origins and the motivations of their founders. In this sense the concept of path dependence is important in that their trajectory is at least in part predetermined by the initiating set of values and priorities (see Pierson, 2000, Kay, 2005). The importance, and multiple meanings, of social capital is also relevant since it helps to explain the formation of these organisations and their dynamics. Putnam and others distinguish between bonding social capital, which links members of the same community, and bridging social capital which puts communities in touch with others such as decision-makers and political elites (see for example Bolin et al., 2004, Portes, 1998, Putnam, 2000).

Thus for the purposes of this monograph the sub-set of social enterprises being studied will be called community enterprises. One of the best definitions is:

Community enterprise organisations working for sustainable regeneration in their community through a mix of economic, environmental, cultural and social activities. They are independent, not-for-profit organisations, locally accountable and committed to involving local people in the process of regeneration. (DTA, 2000, p. 3)

The UK has a long history of utopian thinking and the establishment of co-operative and mutual organisations which some authors trace back well beyond the establishment of New Lanark by Robert Owen in the early 1800s (Woodin et al., 2010, Wyler, 2009). The UK also has a large voluntary and community sector made up of thousands of charities, social enterprises, faith groups and unconstituted community groups in metropolitan, urban and rural locations. Much of this culture transferred to the USA where community development corporations play a similar role to community enterprises in the UK. Europe is less comparable in that the state is still the primary provider of community services and facilities.

Urban regeneration in the UK has taken many forms and has been typified by a series of area-based and funding initiatives in areas with relatively high levels of deprivation (Tallon, 2010). The assumption has tended to be that the public sector should take the lead but at the same time the private and community sectors are often incorporated in complex partnership arrangements (Bailey, Barker, & MacDonald, 1995). Whilst community involvement was seen as an important component of many regeneration strategies, community enterprises as discussed here were usually involved but rarely played a central or co-ordinating role.

This monograph aims to investigate the organisation, constitution and delivery of these community enterprises and especially to explore how they contribute to local regeneration strategies. The main research focus will be on the UK but comparisons will be made with the USA and other countries where relevant literature is available. The key questions to be addressed relate to:

• Organisation: How are these organisations formed, who do they represent and what legal and financial models are available? How do they go about acquiring and funding asset development with what consequences? What are the implications for representation and accountability to members and local interests? Can they access the necessary skills and expertise required to operate effectively?

• Policy: What has been the response from central and local government and what has been done to promote asset transfer? What aspects of regeneration are community enterprises best able to support and how have they gone about this? What further policy changes would better enable them to achieve their objectives? How comparable is the UK experience with that from the USA and other countries?

• Delivery: How have these organisations responded to policy initiatives, expanded their role, and overcome financial, political and technical challenges? What are the main challenges they face? What services do they provide at the local level and what are the prospects for the future?

A wide variety of sources have been drawn on in writing this monograph. The main sources are government reports and policy documents, case studies and papers from practitioners directly involved in the field. Strangely, relatively little academic attention has been paid to this field and there have been few attempts at balanced evaluations other than by those employed by organisations with a particular interest. One of the purposes of this monograph is to go some way to correcting this imbalance. In addition, a large number of participants in the ‘community of practice’ have been interviewed and consulted. Five case studies were also prepared for the monograph based on both published sources, websites, interviews with key stakeholders and direct observation in 2010–2011. Other examples are discussed where relevant. Financial support was provided by the University of Westminster to cover travel and related costs.

It should be noted that the UK is now formed of four ‘countries’ – England and the three devolved administrations of Scotland, Wales and Northern Ireland. In each case, local regeneration strategies and the role of the third sector are policy areas which are devolved so that they all differ in some respects. For these reasons, this monograph mainly focuses on case studies from England and Wales. The author has also drawn on personal experience as a board member of a community enterprise in London.

The monograph is divided into eight sections. The following section explores the evolution of community enterprise organisations and the factors contributing to their growth and expansion in relation to local regeneration agendas. The third examines the national and local policy context in the UK with particular reference to England in order to find out what has been done to promote community enterprise at central and local levels. Section 4 draws on comparisons with community development corporations in the USA and elsewhere. Section 5 discusses the legal, constitutional and partnership arrangements, sources of core and project funding and factors influencing the identification of priorities. The following section sets out key findings from a number of case studies in England and Wales and discusses the contribution they make to the planning and delivery of national and local strategies. Section 7 provides a detailed analysis of the field, identifying areas of strength and impact, as well as challenges and issues to be addressed in future. The paper ends with broad conclusions about organisation; policy and delivery as outlined above and identifies possible directions for the future.