Preston Model

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= UK version, in the city of Preston, of the famous 'Cleveland' model, based on mobilizing anchor institutions (hospitals, universities), for the creation of a cooperative and localized economy.

Description

Justin Reynolds:

"Preston City Council’s work towards developing an economic ecosystem rooted in co-operative principles informed elements of the programme on which Labour fought June’s general election. It’s also at the heart of a major new report, seeking to establish a philosophy to guide the party’s economic policy at local and national level.

The foundations of the Preston Model were laid in 2013, as the Labour-run council cast around for ideas to rebuild the economy of a city ranked in the bottom 20 per cent of the deprivation index, and facing the near-halving of its central government grant from £30m to £18m.

The council looked across the Atlantic to find a possible way forward. It found it in the example of Cleveland, a rust-belt city that has pioneered initiatives to consolidate and widen the circulation of wealth within its economic orbit.

Cleveland’s ’community wealth building’ project emphasises the role large institutions rooted in a municipality such as hospitals, airports, colleges, housing associations – and local authorities themselves – can play as ‘anchors’ around which regional economic ecosystems can stabilise and grow.

By allocating more of their spend budgets to local suppliers and producers, recruiting from the workforce on their doorsteps and incubating local businesses and community organisations, the anchors can keep wealth flowing in municipal economies." (http://www.citymetric.com/politics/could-preston-provide-new-economic-model-britain-s-cities-3243)


Discussion

Preston as a new model for Muncipal Socialism

Thomas M. Hanna, Joe Guinan and Joe Bilsborough:

"With the leadership of Jeremy Corbyn and John McDonnell, municipal socialism has once again returned to the Labour Party’s agenda in a powerful way. “With amazing creativity in the toughest of times, we are seeing the first shoots of the renaissance of local government for the many, not the few—the rebirth of municipal socialism”, Corbyn proclaimed in February of this year.

As indicated above, one of the leading models of re-emerging, modern-day municipal socialism in the UK is to be found in Preston. In 2011, the city—which had been declining economically since the 1970s—was reeling from a bitter double blow. Central government funding was plummeting under the austerity regime of Cameron’s coalition government and long held revitalization plans based on a £700 million shopping centre had collapsed. The newly-elected Labour council realized that they needed to come up with a new strategy. It was then that Councillor Matthew Brown, Cabinet Member for Social Justice, Inclusion, and Policy, stepped forward with his ideas. Inspired by alternative forms of economic development around the world, including the Mondragón cooperatives in the Basque region of Spain and the Evergreen Co-operatives in Cleveland, Ohio, Brown and his fellow councillors began to develop plans to deploy Preston’s existing assets and financial clout to catalyse a new local economic model that builds wealth rather than extracts it from the community. Working with the Manchester-based CLES, Preston Council approached the large anchor institutions in the area and came up with a strategy to shift as much of their spending and procurement back into the local economy as possible. In 2013, six of the local institutions that signed up for the effort spent around £38m in Preston and £292m in Lancashire as a whole. By 2017 this had skyrocketed to £111m and £486m respectively. The new localized contracts cover everything from school lunches to large-scale construction projects. Moreover, contracts shifted locally have a multiplier effect, as pounds circulate and recirculate throughout the local economy, creating jobs which in turn lead to more spending on goods and services, which then leads to the creation of more jobs, and so on.

The Preston Model, however, is about much more than just developing the local economy through shifts in spending and procurement. It is about alternative forms of ownership that not only enrich the lives and livelihoods of residents and workers, but also give them the opportunity to actively participate in the economic decisions that affect their lives and the future of their city. Even before working with the anchor institutions, Preston Council backed plans to develop co-operatives (and link them to the procurement needs of the anchors) and a public financial institution (see Chakrabortty, 2018; Sheffield, 2017; Singer, 2016).

Preston has been lauded by the Labour leadership and by sections of the media as an example of what could be achieved—albeit on a far greater scale—nationally under a Corbyn-led government. “This kind of radicalism”, argued John McDonnell in a 2016 speech at the Preston-based, worker-owned transport company TAS, “is exactly what we need across the whole country”.

Star Guardian columnist Aditya Chakrabortty kicked off his excellent new series exploring real-world economic alternatives with an in-depth study of the Preston Model, following on the heels of a broadly sympathetic write-up in The Economist, which dubbed Preston ‘Corbyn’s model town’. In a speech to the Co-operative Party, Corbyn himself praised the “inspiring innovation” of developments in Preston, particularly when set against the wider backdrop of swinging cuts to local government funding.

Preston also demonstrates the renewed potential of modern municipal socialism as a political strategy. As was the case a century ago, advancing a radical and innovative program of local economic regeneration can quickly lead to tangible political benefits. In the May 2018 local council elections, the Preston Labour Party pledged (among other things) to increase investment and jobs based on the Preston Model; to create a public bank and local wealth fund; to support the creation of new worker cooperatives; and to ask the Lancashire Pension Fund to invest more in the local economy (Preston Labour, 2018). The voters responded, as Labour increased its majority on the local council by picking up two seats—College Ward and Garrison Ward—that had long been controlled by the Tories. Moreover, as new councillor for College Ward Freddie Bailey explained to local journalists, “what we found helped was the Preston Model” (Farnworth, 2018). This was reinforced in the wake of the election when Matthew Brown was elevated to become Leader of Preston City Council." (https://www.opendemocracy.net/neweconomics/preston-model-modern-politics-municipal-socialism/?)


The Book

* Book: The Preston Model and Community Wealth Building. Creating a Socio-Economic Democracy for the Future. Edited By Julian Manley, Philip B. Whyman. Routledge, 2021.

URL = https://www.routledge.com/The-Preston-Model-and-Community-Wealth-Building-Creating-a-Socio-Economic-Democracy-for-the-Future/Manley-Whyman/p/book/9780367514099

"Through a deep examination of what has become known as the ‘Preston Model’, this book explores an innovative approach to local economic development that utilises economic democratisation to realise both social and economic objectives.  

The first part of the book examines the main strands of the Preston Model framework and what makes it different to other urban regeneration schemes: the combination of local anchor institution procurement to generate and retain local wealth, and the development of cooperatives to fill gaps in local supply chains. The chapters in this section consider the Preston Model as viewed through different lenses: politics and society, community, economics, democracy, trade unionism, language and communication, education and transferability. The second part explores the influences and applications of the Preston Model, in theory and practice, in selected locations and various circumstances worldwide. This includes discussion of key ideas such as economic democracy, social enterprise and the creation of capacity for cooperative self-government, alongside essays on prominent international examples of similar approaches, which can inform and in turn be informed by the Preston Model.  "


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