Transitioning to a New Local Economy in Your Community
Reconomy is an economic reform strategy proposed by the Transition Network. It is based upon a decentralized, local economy which builds up a community’s’ economic independence and resiliency in a way friendly to planet and people.
We hope our work contributes to a growing body of evidence about the potential of community
economic development to “redistribute economic power, reduce disconnection, inequality and
vulnerability to economic failure”, and inspires others to undertake similar projects. – Totnes & District Local Economic Blueprint
Localism is a recent buzzword but it’s roots are as ancient as humanity. Small communities have been the mainstay of human civilization and large urban centers are a fairly recent phenomena of the last few centuries, a product of capitalism and industrialized technocracy. Indeed, small communities can be seen as the natural pre-cursor to the large urban megapolis which are predicted to be home of the majority of human civilization. The trend towards urbanization has also been accompanied by a redistribution of wealth towards those urban centers. Large cities and their surroundings account for the majority of the world’s wealth, resource usage as well as pollution. Recognition of this fact by groups such as the C40 initiative promise to address climate change issues where national governmental efforts such as the Kyoto Protocol have failed.
The Transition Movement and Reconomy are rural and community-based solutions to climate change and a host of other problems. Communities are experiencing a resurgence of localism. A 2013 report entitled Totnes & District, Local Economic Blueprint provides a template that will help any community wanting to move in the same direction. It was released by the UK community of Totne (one of the epi-centers of the Transition movement) consolidates the power of localism.
Outcomes of the Totnes Local Economic Blueprint
One of the main outcomes of the report is that there is tremendous opportunity available by identifying what localist economists such as Michael Shuman call leakage…the amount of money leaking out of the local economy. In this respect, Totnes findings are not surprising and are consistent with Shuman’s study results. Once a community determines how much potential income is leaking out of the local economy, the next step is to devise an import substitution strategy. The leakage analysis and import substitution strategy go hand-in-hand and usually follow each other logically.
Figure 1: Totnes leakage analysis shows the production and consumption opportunity (Source: Totnes & District Local Economic Blueprint )
When we look at our 200 or so local suppliers, we see that they produce far more food and drink than our local area buys. Of course this is also to meet demand elsewhere and Riverford, for example, has a major impact on our figures. But how much do we spend on local produce today? A report on our local food web18 by the Campaign to Protect Rural England (CPRE) suggests that around £8m is spent on products from the local area (up to 30 miles), which indicates that the other £22m of our retail spend goes on products imported from elsewhere in the region, the country or the world. – Totnes & District Local Economic Blueprint
Our data indicates that we currently have about 380 food related businesses in T&D: they
employ just over 1,500 people or around 14% of all those employed, and their total turnover is
around £114m. Of this, we are especially interested in what households spend on food and drink
in the retail shops, reflecting demand for products for home consumption, which is about 31% of
total sector turnover as shown in figure 2. This equates to a total spend of around £30m pa on
food and drink for consuming at home.
. – Totnes & District Local Economic Blueprint
To effectively scaleup environmental stewardship, sustainability must become an integral part of our socio-economic system. The Transition Network’s REconomy Project has performed a detailed local economic evaluation to see what the economic potential is in key areas of local sustainable practices. The pilot was carried out with Transition Hereford (a rural county), Transition City Manchester (a city) and Transition Town Totnes (a market town). Forecasting how much revenue and how many jobs exist within a re-localised food sector can produce valuable information that can help get the attention of key organisations (ie. local council) that might not yet understand the true potential of a new economy.
The REconomy team are now starting to create a generic, replicable process that can be used by any community to do similar work – to estimate the potential of a new economy, primarily in terms of quantitative economic value – jobs and revenue – but also exploring social and environmental benefits.
The study’s obective was to ensure that this Transition economic model was taken seriously by community business leaders and can scale.
What kind of local economy do we want?
- The first thing to do is to invite local ‘stakeholders’ to a workshop to explore what kind of local economy is desired
- These stakeholders are typically senior representatives of the local organisations with a remit for, or an interest in, our economic planning
“The purpose of our local economy is to maximise the happiness and wellbeing of our entire community – to create an abundance of opportunity to satisfy our needs, and use and distribute resources fairly – in a way that respects natural limits.”
Growth in happiness and wellbeing is critical and this is connected to economic well being.
What questions do we want to answer?
The team decided to investigate the 4 sectors that play an important role in the community’s sustainability and resilience:
- food – food independence and security
- retrofitting – adapt existing buildings to sustainable ones
- renewables – benefiting from renewable energy
- care & wellbeing – taking care of health, the most vulnerable people and exploring the gift economy
Questions that arose in the food sector were:
- How much do we spend on food and drink here today?
- Where is this money spent?
- What’s the value of the food and drink we produce locally?
- How much do we spend on local produce?
This effort was repeated for each of the 4 sectors. Once sufficient data was gathered for each sector, a small group of local experts discussed the findings, and suggested a number of projects that could turn the potential opportunities into reality.