Special release - 19 October 2016
Local ownership has been found to be extremely important for local economic prosperity.
Research has found that if you spend your money at, for example, a supermarket chain, 80% of your money will have left the local area immediately. This is known as “monetary leakage”.
Stopping such leakage allows for what’s called a Local Multiplier Effect.
Had that money been spent at a local business, half the money (rather than a mere 20%) would have stayed circulating in the local economy, increasing revenue for local businesses and so improving local employment conditions. Money is recycled in the community to create a resilient and thriving local economy.
Studies examining the economic benefits of community renewable energy projects have also consistently found that local ownership of, for instance, wind farms, generates an average of 2.5 to 3.5 times more jobs and 3.1 to 4.5 times more local dollars compared to absentee ownership. This is achieved due to increased use of local labour, businesses and materials; dividends paid to local shareholders; and servicing of local bank loans.
When communities lose a community asset – like the Corkman Pub – it has a ripple effect for the rest of the area. The loss is both tangible, in terms of economic value, as well as intangible, in terms community value.
Moves are being made globally to protect community assets. In the UK, for example, The Pub is The Hub group states:
“Like so many across the UK, we want to ensure that pubs and other rural services remain pillars of the community.”
CAMRA UK similarly writes:
“Community ownership gives you the opportunity to work at a grassroots level and provide a facility in your community that reflects the wants and needs of your local area; protecting valued assets for generations to come.”
Protecting local assets is extremely important also in terms of heritage value. We cannot trust our councils to protect things for us. For example, it’s been alleged that current Melbourne Lord Mayor Doyle recently ignored the illegal demolition of the rear of the Melbourne Cricket Ground Hotel, also heritage listed, having been built in 1859.
So how can we ensure protection for our assets? One answer would be to institute a “Right to Buy” scheme. Such a scheme was created in the UK as a result of the 2012 Localism Act.
This means that communities can ‘stop-the clock’ on the sale of valuable local assets and amenities like post offices, village shops or community pubs, giving them time to put in a bid of their own and protect it for the wider benefits of the community.
The new right gives voluntary and community organisations and parish councils the opportunity to nominate an asset to be included on a list of ‘Assets of Community Value’, pausing the sale of a successfully listed asset for six-months, giving communities the opportunity and time to prepare a bid and get a business plan together. Previously a community has had no opportunity or time to gather resources to bid to buy or take them over.
Long term, it will be important to force through some kind of Right to Buy scheme in Victoria in order to protect our heritage assets State-wide. With regard to the Corkman Pub, however, we don’t have much time.
But we do have a strong bargaining position at this moment. The current owners face hefty fines and may be forced to sell. We must start thinking of ways that the community can take ownership.
Can we build a coalition of buyers?
This could include larger local institutional actors like the University of Melbourne, the University of Melbourne Student Union, the Law Student Society, Graduate House, the Graduate Student Association, and perhaps even the Council. It could also include smaller players and community members who could buy community shares in the Pub.
Instead of the Pub being owned purely for profit, its ownership could be spread amongst those who use and benefit from the Pub; who respect its history and the services it provides; who would care for it.
There is a danger that if we don't do this, we'll only get skin-deep rectification. It's been reported that "Melburnians lost more than bricks and mortar"; but if we only push the heritage aspect, rather than community ownership, then all that will be rebuilt will be the bricks and mortar. Behind the heritage shell will be investor-owned flats, of no use to the community and potentially destructive of it.
Local assets, local ownership!!
Duncan Wallace is a third-year JD student and Chief Editor of De Minimis. The above is written in his personal capacity.