LOCAL MONEY: how to make it happen in your community
by Peter North
“Whoever controls money controls our lives. Taking back that power for good, not harm, has to be at the heart of new thinking after the crash. Without change, the next one could be Armageddon. This book tells every community everywhere how to make local money work for local good.” – Polly Toynbee, Guardian columnist
“A local currency is essential for greater local resilience. Peter North’s comprehensive and well-written survey of local money systems is the best guide by far for communities planning to launch their own currency.” – Richard Douthwaite, author, The Growth Illusion and The Ecology of Money
In past recessions and depressions, a popular response from communities has been to create their own forms of money. The jobs aren’t there, and the money has dried up, but needs remain. Avoiding dangerous climate change means cutting as much carbon out of our economies as we can, and we can do this by cutting unnecessary transport through localisation. How can local money facilitate this?
An inspiring yet practical new Transition Book, Local Money helps you understand what money is and what makes good and bad money, and reviews how people around the world and in the past have experimented with new forms of money that they create themselves.
The book draws on the track record of experimentation with local money to show those in the Transition movement and beyond what has been tried, what works, and what to avoid. Different models of alternative currencies are reviewed, from the Local Exchange Trading System (LETS) and TimeBanks, which work within communities, to paper currencies such as Berkshares, German regional currencies and Ithaca ‘hours’, which circulate between local businesses as an alternative to their losing trade to the national chain retailers. Currencies like Ithaca ‘hours’ can also easily be used to enable people to exchange services locally at agreed hourly rates.
How can local banks and bonds help us move our cities, communities and homes on to a more sustainable footing? The book suggests how groups can create future forms of local money that can deepen local resilience and support the development of more local production of the things we need, such as food and power.
The Author: Peter North teaches Geography at Liverpool University. He first heard about local currencies while doing a Masters in Peace Studies in 1992, and has been exploring local currencies worldwide since then. He is one of the founder members of Transition South Liverpool.
Together with other community groups, individuals and the Matlock Mercury newspaper, Transition Matlock is working hard to create new spaces for growing food, so that as many local people as possible have the opportunity to enjoy all the benefits of growing their own fruit and veg. As part of this, we are trying to help address the huge waiting lists for allotments. That includes asking our local councils to help sow the seeds of change, and to do everything they can to provide the community with extra, much-needed allotments.
In May 2010 Harvest Creative made this film for EMSSE (East Midlands School for Social Entrepreneurs).
The role for social enterprise in creating a sustainable local food system.
Here is the jigsaw Helen created for the workshop at the The Business of Transition Event held on 24th April 2010.
When we begin to imagine what a typical weeks menu would like in 2040, and create a weeks menu plan in which local food is the majority of our diet with fair trade products the occasional luxuries, we see the gaps that exist in our existing local food supplies. We see the need for new small scale businesses to emerge to supply local food such as local cheeses, local bread, local salami's etc to our towns and villages.
We need to build a new local food economy, so that local food is delivered from local extensive farms ie farms with mixed range of livestock, mixed arable and vegetable production, to the local community. New on-farm food processing enterprises may emerge, suppling local food products made locally with local ingredients and sold in local shops.
To relocalise our food system we could to set up new forms of local food enterprises – moving away from the mass market industrialized food system – to small scale co-operative food enterprises that bring together small scale producers with retailers and consumers.
In my jigsaw, the community is the central circle.
Each individual piece, in the article below, can be clicked on to expand the size and read the details.
Out from the circle emerge local food projects, encouraging the community to seek out and buy food from local producers and therefore encouraging local retailers to stock local food.
The outer layer of the jigsaw are the new social enterprises that have been developing in recent years, in many instances developing out from the local food projects.
I think this is a very exciting time for people who want to change our food system back to a local one, and for those who want to create fulfilling new employment opportunities in local food enterprises and farming. We now need to encourage local social entrepreneurs to come forward and gain the support needed to build the food economy and farming system that we need.
Within Matlock we are beginning this process, and Matlock Area Community Supported Agriculture Co-operative is a great start.
We are also beginning to look at a Food Hub for Matlock area.
Please get in touch if you would like to be involved in any of these or other local food projects.
Social Enterprises are new emerging from local food projects, such as our own Matlock Area Community Supported Agriculture Co-operative...
This article is based on a piece on Transition Network website:
Transition Matlock is looking at different ways to raise awareness of the importance of Shopping Locally, and of encouraging people to source local goods and services. We need to boost our local economy and encourage people to make a conscious decision to spend as much of their hard-earned cash as possible in their own town on locally produced or grown products.
Shops and services in our town centres and villages create local employment and self- employment. Small shops tend to employ proportionately more people in relation to the size of the business. Small independent shops are especially valuable to local economies. Buying locally-produced goods or spending money in local shops keeps wealth circulating in our communities, helping Matlock to become more resilient, at a time when local businesses need our support more than ever. Before heading for out-of-town developments, or the big cities we’d like everyone to consider: “Can I source this locally instead?”
Evidence shows that for every £10 spent in an independent local shop or service £25 is generated for the local economy compared to only £14 being generated for every £10 spent in a supermarket.
Giving your custom to locally owned shops and businesses supports the local economy and makes for a more vibrant and resilient community.
"As a practical illustration, we recently compared the multiplier effects of shopping for fruit and vegetables in a supermarket and from a local organic 'box scheme' (for the uninitiated, it's a fixed-price box of fruit and vegetables delivered to subscribers' doorsteps each week). The results showed that every £10 spent with the box scheme was worth £25 for the local area, compared with just £14 when the same amount was spent in a supermarket. “
New Economics Foundation "Plugging the leaks' p 20
We have within Matlock some fantastic independent shops and services. We need to support local businesses and by doing so support the local economy and local jobs. Work undertaken by the New Economics Foundation on the Local Multiplier Effect means that money spent locally is worth even more when traced through 3 or 4 local spending rounds, therefore it is vital that a Shop Local Campaign encourages residents, businesses and local authorities to consider “Can I source this good or service locally?” It is estimated that every pound spent in the town centre will be spent at least another five times before leaving our community.
The table produced by the NEF makes very interesting reading, showing what percentage of spending chain stores respend locally.
Sainsburys spends 9% locally,
Iceland spends 13.5% locally
JD Wetherspoons 19.2%
Source: New Economics Foundation “The Money Trail” p116
It's when you look at this financial impacts of local shops vs national chains that you really see the impact on the local economy.
Here is an example of how powerful our shopping decisions are. Consider a supermarket where 80% of the money spent at the till leaves the local economy and enters the global market of manufacturers, distributors, transporters and investors, and only 20% is left locally as wages, rates and services. (This is a generous assumption as the figures above show that Sainsburys only spends 9% locally not 20%.) If £100.00 is traded four times it leaches out of the local economy fast:
|Trades||Value of transactions||Leaves the local economy||Stays in the local economy|
Within four trades £100 is down to 16p left in the local economy.
If, however a local grower or producer sells to you and 80% of the money stays in the local economy and 20% leaves then:
|Trades||Value of transactions||Leaves the local economy||Stays in the local economy|
£40.96 is 256 times the amount left in the local economy compared with 16p. This is why our towns are drained of resources - every time we trade with non-local trading entities, our hard earned local money leaches out of the region to shareholders and city institutions.
It’s our economy, our money we spend in our town, lets get it back in our hands….
What can we do?
Shop Locally in independent shops.
- Use the Farmers Market, the veg box schemes, farm shops.
- Ask retailers (particularly food retailers) to stock local produce.
- Medium term:
- Look at starting a Local Food Co-op or Hub.
Look at setting up a Local Currency - the Matlock Crown?
See links below to the latest Transition Town currency to be launched on September 5th. Totnes and Lewes, already have launched Local Currencies with Stroud and Bixton about to do so in the Autumn.
Reskilling is a new category in our calendar where you will be able to find courses for you to enroll on in order to learn new skills. To make things easier to navigate we have also colour coded event categories, eg reskilling events are in pink.
To get you started we have added some courses being run by DCC. There are some self build courses, and a some woodland management courses.
If you have any courses you would like to advertise then you should contact the Transition Matlock Secretary through the contacts page.
Click here or click on the picture to download a pdf of the Build it Yourself poster.
Click here or click on the picture to download a pdf of the Woodland Management poster.
Martin Burfoot has been leading on the creation of a new wood above Starkholmes on land owned by Willersley Castle Hotel. Transition Matlock volunteers have been planting trees – including oak, rowan, birch and hawthorn – on the site (enjoying the sweeping views over Matlock Bath) during weekends throughout March 2009. Trees have been donated by Matlock Town Council and also by Little Green Space.
During March, Transition Matlock and Little Green Space have also been working to save over 1500 self-set ash saplings from an area of All Saints Infants School that is being transformed into vegetable beds for the children. We are planting many of these trees at Cavendish Playing Fields. Ash trees can be pollarded, benefiting the tree and providing what is generally considered to be the best firewood – it burns well and gives out lots of heat. With more and more people buying wood burning stoves (which provide virtually carbon-neutral heating) we need to plant lots of these trees!