Going, going, gone. That is what faces assets owned by Birmingham City Council as they announce £750m worth of assets will have to be sold due to a funding crisis. Behind these numbers sit important community spaces like libraries that everyone can access and which can provide places for people to come together. It is here, often, that civic pride manifests both physically, in the walls that are built and socially, in the relationships formed within them.
Birmingham is not the only council facing difficulties. The LGA has found that almost one in five council leaders and chief executives in England fear they will need to issue a Section 114 notice, shorthand for bankruptcy. It is likely then, that we will see more councils turn to selling off assets as a short-term fix for their financial troubles.
If government allows this to happen it would be very short sighted indeed. It is a one-off bump to the council’s finances to cope with ongoing pressures, not a long-term fix. Worse still, once these assets are sold off it is very unlikely that they will be bought back, so these community spaces will be forever lost.
This is not what the public want. New polling by Opinium for Power to Change shows that, in the event that councils are forced to sell their assets, the public strongly favour them being sold to community organisations and businesses run by local people. When asked, who should have priority in purchasing council assets, if anyone, when they are sold, community organisations and businesses run by local people are by far the most popular option for the public, with 40% prioritising this option, compared to 16% saying ‘whoever can pay the best price’ the next most popular option.
It is no surprise this is the public’s preference. According to IPPR 75,000 public assets, totalling around £15bn, have been sold by English councils since 2010, which includes many much-loved community buildings and spaces. At a time where other important shared spaces such as pubs are being lost, the ones that are left are valued as accessible spaces, that are open to all. We need to find ways to save these assets.
One way to do this is through promoting community ownership of assets. Already community ownership is providing a means through which these spaces can be kept open and restored, all while supporting the local economy. Community-owned spaces contribute £220m to the economy nationally, and help drive down vacancy rates on the high street whilst bringing in footfall that benefits other local businesses.
It is important then that action is taken so that communities can help save some of these vital assets. In the short-term one option is to list these buildings and spaces as Assets of Community Value, so that the community has the Right to Bid, if they come to market. The Save Birmingham Campaign is recommending that people in the city take this route and rightly so. But unfortunately, this still means that the council could sell to the highest bidder at the end of the process. A stronger power needs to be introduced, such as a Community Right to Buy, where communities have first dibs at purchasing Assets of Community Value when they come to market.
Powers on their own will not be enough, however. It is often difficult for communities to quickly raise up the capital needed to purchase assets. Government can play a role by providing the core finance that can often bring in other sources of funding. The Community Ownership Fund has already made a difference in this regard, particularly since recent changes have made it more accessible to communities. Extending and expanding the Community Ownership Fund would mean more communities could benefit from it, and that the Fund is available longer-term – issues in council finances aren’t going away any time soon.
The current or a future government will have to sort out council finances. But in the meantime, we can’t allow these vital community assets to be lost by balancing the books in the short term at the expense of an irretrievable loss in the long term. Promoting community ownership is one route that could be taken to save these assets – government needs to take action.
Josh Westerling is policy manager at Power to Change
