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Councils urged to reap the benefits of handing assets to communities

COMMUNITIES AND LOCAL GOVERNMENT News Release (092) issued by The Government News Network on 15 May 2007

Local people should be given greater control in how key assets in their communities are run - from disused swimming baths to pubs and community centres - a major report to Government published today says.

Making Assets Work, the report on Community Management and Ownership of Assets by Barry Quirk, Chief Executive of Lewisham Council has concluded that transferring public assets to communities not only leads to more responsive services that meet local people's priorities but can also create more confident empowered communities with greater civic spirit.

It concludes that there are no substantive barriers to prevent councils transferring assets into community management or full ownership. Powers already exist for this but the report finds that many are not fully aware of them, or are not using them to full benefit. Therefore a change in culture is required so that every community has the chance for more active citizenship, a greater role in running services and owning assets, and improving wellbeing in their communities.

Underpinned by safeguards to ensure good management councils can sell off or lease assets for as little as than £1 where it is clear it is for the good of the community. Other assets that could be transferred include redundant police stations, old hospital sites, empty shopping parades and closed down pubs on estates.

Barry Quirk said:

"Community ownership can bring people from different backgrounds together; it can foster a sense of belonging and play a role in enhancing the local environment, alleviating poverty and raising people's aspirations. Fundamentally, it's about giving people a bigger stake in the future of their area to improve the quality of life in local communities.

"Many local authorities are leading the way in devolving powers and engaging with their communities. But there will be those who are less enthusiastic, or will be concerned about the risks. We must give local partnerships and communities the tools they need to bring about that change in culture and show that the risks can be managed to benefit communities. We want every local authority to seize this opportunity to make a positive difference to their communities by making their assets work."

In a speech alongside publication of the plan, Communities Secretary Ruth Kelly gave the Government's full backing to the report and said that councils must move away from simply relying on the old orthodoxy of distributing grants and look at new ways to devolve power and influence to community organisations.

Ruth Kelly said:

"Britain has a long tradition of community ownership whether it is through the co-operative movement, village halls or resident led housing associations or development trusts. But we must support this across all communities as it is often the case that our most deprived areas have the most to gain from strong community involvement and action.

"We want local people to have the chance to take greater ownership of local assets for community use. That is why I am so pleased with the excellent work Barry Quirk and his team have carried out. The evidence shows this can bring real benefits to the community, bringing a new sense of civic pride, and supporting activity for the wider public good.

"We know from experience that people want a real say and real involvement in decision making, and for local government to give them the opportunities to shape their communities and meet their ambitions. I hope that communities across the country will take up the challenge to bring under-used buildings and assets into community management and ownership."

Next week the Government will announce an action plan to promote a new era of civic pride where every local authority is asked to explore whether public assets could be handed over or run by the community. This will build on the Cabinet Office's £30m Community Assets fund which enables community-led organisations to own and run under-used local authority buildings.

Speaking at the launch Minister for the Third Sector Ed Miliband said:

"I believe that communities have the energy and ideas to improve their neighbourhoods. Transferring the ownership of public buildings to community groups can help release this potential, as hundreds of successful groups already show. This report, together with government actions such as our new £30 million community asset fund, marks another step forward in our determination to enable more communities to come together and shape their local areas."

Local authorities have powers to sell or lease assets at sub-market prices, compulsorily purchase derelict property, or require landowners to clean up sites that are adversely affecting the local neighbourhood. And the Government is providing greater opportunity for people to demand action through new powers in its local government legislation.

As well as promoting a much greater sense of community there is clear evidence that where local people are directly involved in running local services both public satisfaction and quality rises.

The review has seen many examples of success, where communities have taken on a greater role in running local services and, in the process, improved the wellbeing of their communities.

Notes to Editors

1. The report on Community Management and Ownership by Barry Quirk, Leader of Lewisham Council was commissioned as part of the Local Government White Paper, 'Stronger and Prosperous Communities'. The report can be accessed here: http://www.communities.gov.uk/index.asp?id=1510515

2. A summary of Barry Quirk's recommendations:

* The publication of comprehensive, up-to-date and authoritative guidance on all aspects of local authority asset management, including within it detailed and explicit guidance on the transfer of assets to community management and ownership.

* The publication of a toolkit for local authorities and other public bodies on risk assessment and risk management in asset transfer to communities.

* The provision of much greater access for local authorities and community organisations to expert advice and organisational development support relating particularly to the transfer and management by communities of land and buildings.

* The smarter investment of public funds designated for community-led asset-based developments, where permissible, through the involvement of specialist financial intermediaries with expertise in the field and the ability to achieve high leverage ratios.

* A major campaign to spread the word, through seminars, roadshows, training, use of the media, online and published information, and the dissemination of good practice, as well as promotion of "bottom up mechanisms" such as the proposed Community Call for Action and the existing Public Request to Order Disposal (PROD).

4. The Government's programme for empowering communities was set out in last November's white paper which included ambitious proposals to give citizens and communities a clearer voice, and greater freedom and powers to local government. This programme included new rights through am extended community call for action, greater scope for creating parish councils and expanding the ability to set local byelaws.

5. Current powers and policies that relate to community management and ownership of assets:

* A general consent (2003) for local authorities to sell property at less than best value or to lease at less than market rent, to improve the environmental, economic and social well-being of the area, up to a limit of £2million difference. The Best Value consideration must be met.
* In certain situations, local authorities have compulsory purchase powers, which can apply to derelict private property.
* The Secretary of State has discretionary powers to direct local authorities and certain other specified public bodies to dispose of their interest in land and buildings, in response to a request from a member of the public. The aim of this is to deter public sector landowners from holding on to vacant land or derelict buildings unnecessarily. This power, known as public request to order disposal, or PROD, is not currently well known or used.
* Local authorities also have a discretionary power to require landowners to clean up 'land adversely affecting the amenity of the neighbourhood'.
* The Treasury revised its guidance to funders in 2005, so that clawback provisions, while protecting public funding, do not prevent organisations from using their assets to promote enterprise and generating a surplus to promote their sustainability. HMT guidance is permissive on clawback. It is up to organisations to decide what to do.
* Charitable foundations can by law disburse funds to organisations which are not charitable, but which are promoting community benefits, such as those constituted as Community Interest Companies. This is not widely known amongst local community groups.

6. Recent analysis into Best Value Performance Indicators has found that the extent to which people believe they can influence and participate in local decision making can significantly influence their level of satisfaction with their local council.

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