Beyond Preston: How local wealth building is taking the UK by storm

Preston Bus Station. Image: Getty.

The Preston Model, which has seen the Lancashire town rise from the bottom 20 per cent of the deprivation index to be named the UK’s most improved city, has become the poster child for an insurgent economic approach known as “local wealth building”. This uses the levers of the local state to reorganise the economy away from neoliberalism and towards local economies rooted in social, economic and environmental justice.

While the programme’s success in Preston is obvious from the widespread interest it has received among policy makers, politicians and commentators, local wealth building is also being explored elsewhere to confront economic failure, social hardship, wealth extraction and environmental degradation. 

In Manchester, the programme first began in 2008, pioneered by the Centre for Local Economic Strategies (CLES) and Manchester City Council. Together they grew the number of organisations based in the city that were competing and winning contracts from the city government by 50 per cent. 

From this early work on procurement, local wealth building initiatives began to focus on the idea of “predistribution”, a counterpoint to the redistributive policies, such as ”inclusive growth”, a current zeitgeist among policy makers that advocates a weak form of redistributing wealth through taxes and benefits after the fact of its creation. Local wealth building instead aims to construct an inclusive economy where wealth is generated by and for all citizens. In doing so, it slays the neoliberal dragon of trickle-down economics and rebuilds wealth from the bottom-up rather than the top-down.

To achieve this, local wealth building follows a model based on “anchor institutions”, where local businesses and socially-focused enterprises outside the local area compete for commercial contracts from institutions such as housing organisations, universities, schools and hospitals. These institutions hold a unique position in the local economy, as they employ people, buy things, hold property and assets and are unlikely to relocate from the local area. 

The Preston Model is a welcome indication that this anchor approach can work. But in places beyond Preston, this agenda has taken diverse forms; what unites these places is five central principles. These are:

  • Plural ownership of the economy – deepening the relationship between the production of wealth and those who benefit from it. This means returning public services to direct democratic control by insourcing public goods and services. It’s also about developing cooperatives and locally owned or socially focussed enterprises in the public and commercial economy.
  • Making financial power work for local places – increasing flows of investment within local economies by, for example, directing the funds from local authority pensions away from global markets and towards local schemes and community-owned banks and credit unions.
  • Fair employment and just labour markets – working within large anchor institutions and their human resource departments to pay the living wage, adopt inclusive employment practices, recruit from lower income areas, build secure progression routes for workers and ensure union recognition.
  • Progressive procurement of goods and services – developing a dense local supply chain of local enterprises, employee-owned businesses, social enterprises, cooperatives and other forms of social ownership that can provide goods and services to large local anchor organisations.
  • Socially productive use of land and property – ensuring that local assets including those held by anchor organisations are owned, managed and developed equitably, so that local communities can harness any financial gain from these assets.

This movement is growing rapidly; CLES is working with Gateshead, Sunderland, Darlington, Hartlepool, Wakefield, Leeds, Calderdale, Kirklees, Oldham, Wigan, Salford, Birmingham, Lewisham, Wirral and Southampton to adopt local wealth building initiatives involving a range of anchors.


In London, Islington is deepening its progressive procurement practices and examining ways to tackle the rentier economy and speculative land and property ownership. In Gateshead, the council has a longstanding process of insourcing. In Wales the first Minister has made a commitment to ensure a programme of local wealth building, and in Scotland, local government is establishing a pilot linking local wealth building to a growth deal. Elsewhere, the NHS has adopted the anchor approach as part of its long term plan.

In the coming years as this movement becomes more embedded in regions across the UK, the “Gateshead model” or the “Wirral model” should achieve as much attention as the pioneers of Preston. The Labour Party has established a community wealth building unit and the ongoing work of the government’s inclusive economic partnership magnifies the local wealth building agenda. In the age of experiments, the lessons of Preston, Gateshead, Islington and elsewhere must become a new mainstream for all forms of local economic development.

Jonty Leibowitz is a researcher and Neil McInroy is the chief executive at the Centre for Local Economic Strategies (CLES), the think and do tank working on progressive economics for people and places. 

 
 
 
 

The mountain in North Wales that tried to stop the UK’s blackout

Elidir Fawr, the mountain in question. Image: Jem Collins.

Last Friday, the UK’s National Grid turned to mush. Not the official term perhaps, but an accurate one after nearly one million people were left without power across the country, with hundreds more stranded at train stations – or even on trains (which isn’t nearly as fun as it might immediately sound). 

Traffic lights stopped working, back-up power failed in hospitals, and business secretary Andrea Leadsom launched an investigation into exactly what happened. So far though, the long and short of it is that a gas-fired power station in Bedfordshire failed just before 5 o’clock, followed just two minutes later by Hornsea offshore wind farm. 

However, amid the resulting chaos and inevitable search to find someone to blame for the outage, a set of mountains (yes, mountains) in North Wales were working extremely hard to keep the lights on.

From the outside, Elidir Fawr, doesn’t scream power generation. Sitting across from the slightly better known Mount Snowdon, it actually seems quite passive. After all, it is a mountain, and the last slate quarry in the area closed in 1969.

At a push, you’d probably guess the buildings at the base of the mountain were something to do with the area’s industrial past, mostly thanks to the blasting scars on its side, as I did when I first walked past last Saturday. 

But, buried deep into Elidir Fawr is the ability to generate an astounding 1,728 megawatts of electricity – enough to power 2.5 million homes, more than the entire population of the Liverpool region. And the plant is capable of running for five hours.

Dubbed by locals at the ‘Electric Mountain’, Dinorwig Power Station, is made up of 16km of underground tunnels (complete with their own traffic light system), in an excavation which could easily house St Paul’s Cathedral.

Instead, it’s home to six reversible pumps/turbines which are capable of reaching full capacity in just 16 seconds. Which is probably best, as Londoners would miss the view.

‘A Back-Up Facility for The National Grid’

And, just as it often is, the Electric Mountain was called into action on Friday. A spokesperson for First Hydro Company, which owns the generators at Dinorwig, and the slightly smaller Ffestiniog, both in Snowdonia, confirmed that last Friday they’d been asked to start generating by the National Grid.

But just how does a mountain help to ease the effects of a blackout? Or as it’s more regularly used, when there’s a surge in demand for electricity – most commonly when we all pop the kettle on at half-time during the World Cup, scientifically known as TV pick-up.

The answer lies in the lakes at both the top and bottom of Elidir Fawr. Marchlyn Mawr, at the top of the mountain, houses an incredible 7 million tonnes of water, which can be fed down through the mountain to the lake at the bottom, Llyn Peris, generating electricity as it goes.


“Pumped storage technology enables dynamic response electricity production – ofering a critical back-up facility during periods of mismatched supply and demand on the national grid system,” First Hydro Company explains.

The tech works essentially the same way as conventional hydro power – or if you want to be retro, a spruced up waterwheel. When the plant releases water from the upper reservoir, as well as having gravity on their side (the lakes are half a kilometre apart vertically) the water shafts become smaller and smaller, further ramping up the pressure. 

This, in turn, spins the turbines which are linked to the generators, with valves regulating the water flow. Unlike traditional UK power stations, which can take hours to get to full capacity, at Dinorwig it’s a matter of 16 seconds from a cold start, or as little as five if the plant is on standby.

And, designed with the UK’s 50hz frequency in mind, the generator is also built to shut off quickly and avoid overloading the network. Despite the immense water pressure, the valves are able to close off the supply within just 20 seconds. 

At night, the same thing simply happens in reverse, as low-cost, surplus energy from the grid is used to pump the water back up to where it came from, ready for another day of hectic TV scheduling. Or blackouts, take your pick.

Completed in 1984, the power station was the product of a decade of work, and the largest civil engineering project commissioned at the time – and it remains one of Europe’s largest manmade caverns. Not that you’d know it from the outside. And really, if we’ve learned anything from this, it’s that looks can be deceiving, and that mountains can actually be really damn good at making electricity. 

Jem Collins is a digital journalist and editor whose work focuses on human rights, rural stories and careers. She’s the founder and editor of Journo Resources, and you can also find her tweeting @Jem_Collins.