After a decade of austerity, Hartepool is looking to Preston for a new economic model

Hartlepool. Image: Getty.

Since the Lancashire city of Preston was named “most improved urban area” last November, the “Preston Model” has been attracting excitement in the Labour party and local government circles. Before this accolade, The Economist had reported from the city in October – labelling it “Jeremy Corbyn’s model town” and an “unlikely laboratory for Corbynomics”.

In the spotlight was Preston’s new local economic programme, led by the Labour-run city council and pioneered by its leader Matthew Brown, who my colleague George Eaton interviewed last year

The idea is called “community wealth building”, and basically sets up the local economy to keep as much money local as possible. It came about in Preston when a planned £700m city centre redevelopment fell through through in 2011. After this, the council decided to build an alternative growth model, based on local procurement, rather than its usual approach of chasing inward investment from large multinationals, which it argues leads to money leaking from a local area.

Beginning in 2013, and with help from the Centre for Local Economic Strategies think tank, Brown persuaded six “anchor institutions” – bodies tied to an area, like universities, colleges, housing associations, which cannot relocate – to spend their procurement budgets on Preston-based businesses, rather than outsourcing to companies headquartered in other parts of the country.

These six local public bodies went from spending £38m in Preston in 2013 to £111m by 2017. The proportion of their spending in Lancashire doubled from 39 per cent to 79 per cent. Preston city council has doubled the money it spends locally: from 14 per cent of its budget in 2012 to 28 per cent in 2016. None of this increases local spending – it simply redistributes it.

Preston city council became the first living wage employer in the north, founded a not-for-profit energy firm, established a credit union, and encourages local businesses to become co-operatives and public bodies to deal with more co-operatives. There are plans for a Lancashire-wide community bank, too.

These changes came long before Jeremy Corbyn became leader, but shadow chancellor John McDonnell has aligned himself with Preston’s innovation. He has established a Community Wealth Building Unit last February to export the Preston Model to other areas, announced a proposal for worker “ownership funds” in private companies at the last Labour conference, and featured Preston’s story in a pamphlet entitled “Alternative Models of Ownership” ahead of the 2017 election.

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Now the north east coastal town of Hartlepool is in touching distance of being next in line to the Preston Model. The Hartlepool Fabians – set up by members of the local Labour party in early 2018, and including prospective councillors, sitting councillors and trade unionists – have consulted Preston’s Matthew Brown and produced a fully fleshed-out policy proposal for a “Hartlepool Model”.

They are part of a majority of Hartlepool Constituency Labour Party delegates –described by one councillor, since resigned, as “power crazy individuals”- who want to see a change of leadership on the Labour-controlled council, and attempted unsuccessfully to oust Hartlepool Borough Council’s leader Christopher Akers-Belcher in a vote of no-confidence last November.

They have, however, deselected four sitting councillors, including the mayor, and expect their faction to dominate the council after the local elections in May, so that they can carry out their plan.

A23-page document entitled “The Hartlepool Model of Community Wealth Creation” has not yet been published, but has been seen by the New Statesman. It posits that residents’ prospects will be improved by “inward-facing” investment and procurement, and looks to “forge a future in which they benefit fully from as much of the town’s economic activity as possible”.

The plan includes approaching private “anchor institutions” like the offshore engineering company Heerema, Camerons Brewery and electronics manufacturer Stadium Group PLC to alter their procurement practices, and to group smaller firms together into “purchasing blocks”. It also outlines how to encourage more worker-owned firms, suggesting favourable business rates, a town-wide credit union and a community bank.

The paper reveals the number of unoccupied commercial and industrial properties in the town (1,727 and 430, respectively) available for use. And it proposes using Hartlepool’s “heritage and identity” as a unique selling point to attract entrepreneurs, partly by shifting more investment into arts and culture in the town, partly by promoting other positives: “Low rents, cheap costs of living, the inherent benefits of coastal life: all could be well-marketed to attract a new breed of skilled professional.”

Although it will be a “gradual shift”, the paper’s authors conclude that, “real and rapid gains can be made: through no additional expense or expenditure, money can be injected into Hartlepool’s economy, almost immediately”.

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Hartlepool has been hit hard by austerity, with spending levels slashed by 33 per cent from 2010-17 – the 24th highest in the country – and central government funding expected to fall by 45 per cent by 2020. Seaside towns are among the most deprived communities in the UK, with Hartlepool one of ten local authorities in Great Britain with the highest unemployment rate in 2017.

This is why the new economic plan is “essential”, according to a local English teacher and Labour member Gary Wootton, who founded the Hartlepool Fabians last year. “Hartlepool – typical of northern, coastal, post-industrial and predominantly white working-class towns – has been neglected during decades of economic policy focused on generating wealth elsewhere,” he tells me.


“Austerity politics and London-centric economic policy is shortening lives in places like Hartlepool. They must be afforded the opportunity to attempt innovative economic models, premised on cooperative models of ownership and socially responsible corporate behaviour.”

Wootton, who hopes the council will pursue the plans after new councillors are elected in May, calls the model “pragmatic socialism”. He adds that it took its inspiration from the “Cleveland Model” in the US – a pioneer for this type of economic programme, in which an industrial-scale laundry was set up as a co-operative in 2009 – as well as Preston.

Globally, from the American rust belt to the north east of England, it looks as if in-sourcing, competitive co-operatives and democratising local economies are gaining traction as a response to inequality and decline.

From a British political perspective, the Hartlepool story is unusual, as its local Labour party’s attempted coup is not a result of Momentum or a surge of Corbynite members. Here, it’s the Fabians making life difficult for their council. The Preston Model began before the term “Corbynomics” existed, and the Hartlepool Model policy proposal eschews that description:

“It moves beyond dominant Labour contemporary thought, and builds on an under-developed aspect of Ed Miliband’s proposals, reflecting the very real potential that public procurement has as a means of promoting and furthering social justice.”

Hartlepool will, however, provide the Labour leadership with more ammunition for its ideas of radicalising local economies.

Hartlepool Borough Council has been approached for a response.

UPDATE

A day after it was informed about these plans, a Hartlepool Borough Council spokesperson told me that the council itself has been exploring changes to its economic model, working with the Centre for Local Economic Strategies think tank that helped develop the Preston Model.

They told me: “The Council and Hartlepool’s Health and Wellbeing Board is working with the Centre for Local Economic Strategies to further develop ways in which we can use public sector spending to invest in our local economy.”

There are no further details forthcoming, but it seems pressure from local activists as well as inspiration from Preston and elsewhere means Hartlepool is the place to watch for the next “laboratory for Corbynomics”.

This article first appeared on our sister site the New Statesman.

 
 
 
 

Could twin towns bring Britain back together?

An unlikely pair. Image: Wikimedia Commons.

Twin towns: an irrelevant novelty to most of us, a peculiar name on a village’s welcome sign. But could linking one British town to another – a domestic reinterpretation of this long-standing European practice – help bring Britain back together in a time of national crisis?

Born in the aftermath of World War II, town twinning aimed to foster cooperation and solidarity across Europe. Communities entered formal alliances, nurturing friendships and shared histories. Coventry forged links with Dresden and Volgograd, then Stalingrad, marking the devastation faced by their citizens during the war.

The democratisation of Greece, Spain and Portugal during the 1970s led to a new wave of twin towns across Europe, as did the fall of the Soviet Union a decade later. Since its inception, the focus of town twinning has been on uniting people through relationships. It is a testament to the initiative’s success that many of these remain to this day; Coventry recently enjoyed a performance at the city’s cathedral by Volgograd’s children’s choir.

While European relations have improved since the 1940s, unity at home has received less attention. As a result, Britain is riven with deep economic, political, educational and cultural divides. These fault lines are increasingly determined by geography, with a growing gap between our big metropolitan cities and almost everywhere else.

In comparison to other European countries, we face staggering levels of regional inequality; six of the ten poorest regions in northern Europe can been found in the UK. As outlined by Alan Milburn, the government’s former social mobility tsar, “the country seems to be in the grip of a self-reinforcing spiral of ever-growing division. That takes a spatial form, not just a social one.”

These divisions are poisoning our body politic. As Adam Smith argued in The Theory of Moral Sentiments, putting yourself in someone else's shoes is vital for developing a moral compass; in doing so "we conceive ourselves enduring all the same torments, we enter as it were into his body, and become in some measure the same person with him..." But this is difficult when we have little interaction or experience of those with opposing views.

This is increasingly likely in geographically polarised Britain, with the places we live dominated by people who think alike. Our political leaders must commit time and energy to bridging these divides, just as the leaders of Europe did in the aftermath of the Second World War. By forging links between different parts of the country, a new era of domestic town twinning would do just that.


School exchanges between sister towns would offer an opportunity for children to be exposed to places, people and perspectives very different to their own. This would allow future generations to see things from an alternative and opposing perspective. It may also embed from a young age an awareness of the diversity of experiences seen by people across our highly unequal country.

MPs would be encouraged to spend time in their constituency’s sister town. First-hand exposure to voters in a very different part of the country would surely soften the views of even the most entrenched parliamentarian, making for a more civil debate in the Commons. Imagine the good this would do for Parliament today, with Brexit gridlocked because of the unwillingness of MPs to compromise.

In 2016 the Carnegie UK Trust launched its Twin Towns UK programme, a pilot linking twenty towns across the UK to examine how they might develop together. Emerging benefits include a reduction of insularity and a greater awareness of the bigger picture. Its focus was not on bridging economic divides – towns with similar socioeconomic characteristics were twinned – but initial outcomes from the scheme suggest a broader programme of domestic town twinning could have a powerful impact.

Looking further back, Camden has been twinned with Doncaster since the 1980s, a relationship that unionised Camden Town Hall workers forged in a display of solidarity with striking miners during the 1980s. Funds were raised to feed families of striking workers at the pit and Camden locals even drove north to deliver presents at Christmas. Though the relationship appears less active today, it serves as a powerful reminder of twinning’s capacity to bring people from very different places together.

As we prepare for Brexit it’s imperative that we protect existing twin town relationships with our European partners. This is of vital importance when we know sadly many of these are under threat from austerity and gloriously un-PC mayors. But we should look to breathe new life into these traditions too, where possible. Domestic town twinning would do just that: a step towards bringing Britain back together, just as a continent was reunited after the devastation of war.

Ben Glover is a researcher at the think tank Demos.