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Communities secretary Eric Pickles will need to deliver on the detail if the Localism Bill is to really help grow community enterprise
The government’s Localism Bill has been welcomed by sector commentators – but not without pointing to gaping holes in the detail.

Crucial elements are still to be decided, such as the length of time community groups will be given to try to buy a ‘listed’ community asset like a pub or shop and turn it into a social enterprise, before it is put on the open market.

This detail will be the subject of consultation on the Decentralisation and Localism Bill, which began its passage through parliament yesterday.

The Social Enterprise Coalition (SEC) has called yesterday’s announcements by communities secretary Eric Pickles a ‘double edged sword’. It says the positive elements in the bill, around community ownership of public assets and community-run public services, are under threat of being ignored by councils panicked about bringing down costs.

SEC’s head of policy Ceri Jones said that the bill contained much of what the social enterprise movement has been calling for. But she said: ‘For social enterprises it is a double-edged sword. A time of opportunity to deliver new services and own community assets, but cuts over the next two years will make it difficult for some social enterprises to survive.

‘Social enterprises are often mistaken for being the nice but expensive option,’ said Jones.

Peter Couchman, CEO of the Plunkett Foundation, which champions rural social enterprise, said: ‘This first step is welcome and we will continue to work with the government to ensure that the Community Right to Buy is developed in a way that will make a difference to the growing number of communities that are looking to community ownership and co-operative models.'

On the missing detail in the bill, Couchman, told Social Enterprise that three new community rights would need to be included in the bill if it were to make a real difference.

First, he called for communities to have the right of first refusal for community land and buildings placed on the new ‘list of assets of community value’ that each local authority will be required to develop.

This means that if a building like a local pub comes up for sale by the owner, and if it has been included on the council’s list, than the council should first go to the community to see if there is appetite for a community buy out.

Second, Couchman called for a minimum six-month window for communities to prepare a bid for the asset.

The bill does mention that there will be a ‘moratorium’ period attached to the sale of listed assets and Social Enterprise understands that six months is the period being considered by government. However, while still in opposition, the Tories had talked about a window as small as one month for communities to try to buy pubs before they are put on the open market.

The consultation could also throw up the possibility of local authorities choosing their own moratorium period instead of it being set by central government.

The third right Couchman called for was for communities to access ‘appropriate support and finance’ – a call echoed by several sector commentators.

In a joint statement, the soon-to-be-merged community enterprise support organisations, Bassac and the Development Trusts Association, welcomed the bill but argued that for it to achieve its purpose, community organisations would need specific support to identify common needs and grow skills – particularly if organisations are to take up the new right to challenge local authorities on how best to provide public services.

Bassac CEO Ben Hughes said: ‘The Office for Civil Society’s recently announced Transition Fund should be used to help organisations work more collaboratively to deliver effective public services.’

Hughes added that money from Community Infrastructure Levy could also be put towards this support.

Jonathan Lewis, CEO of The Social Investment Business, also argued for financial support. He said: ‘We know there is great appetite in the sector to do more. But only if the right kind of support is available to civil society organisations – both investment and advice.’

Meanwhile, the National Housing Federation (NHF) has also welcomed the bill as giving greater scope for local councils and communities to shape development in their areas. The NHF was particularly pleased that the government’s decision to drop the threshold for getting a new housing development approved by local people from 75 per cent to a simple majority of more than 50 per cent.

NHF CEO David Orr said few if any schemes would have been approved under what the NHF warned could have become a ‘Nimby’s charter’.

Orr said: ‘The announcement that the threshold for approving community right to build schemes will be reduced to a simple majority of more than 50 per cent is a great victory for common sense.

‘Winning a simple majority of votes will give community organisations and housing associations a greater chance of getting affordable homes built for local people,’ said Orr.

14 December 2010 by Chrisanthi Giotis
Published in: http://www.socialenterpriselive.com