New hope for communities in the year ahead

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Speeches last week from Rishi Sunak and Keir Starmer offered some hope for communities in what will be a very difficult year ahead. We dive into what this means for community businesses.
10 Jan, 2023
Josh Westerling

Josh Westerling

Public Affairs Officer

When the new year comes, resolutions are set but not always kept. That is the challenge that faces both the Prime Minister, Rishi Sunak, and the Leader of the Opposition, Sir Keir Starmer, as we enter what is likely to be a pre-election year. Both Sunak and Starmer took to the stage at the same venue in East London days apart from each other, setting out their stall to the country.

The Conservatives signal challenging times ahead

Sunak’s speech acknowledged the challenges the country faces and pledged to address them. He made five promises on inflation, growth, national debt, NHS waiting lists, and channel crossings. All of these are the priorities for many in the country. But the main question remains, will he deliver on them?

It urgently needs answering because life is tough for so many of us right now, including community businesses. There will be continued pressures on public services over the coming months, coupled with a gloomy economic picture. Inflation remains high, particularly on the price of food. We know that community businesses will continue to provide support in their local area throughout this period. Already in June, our Community Business Market Survey found that 77% of community businesses reported increase demand for food and we’d expect this to continue as long as inflation remains high.

Compounding this is the ongoing issue of high energy costs. The government has announced a new energy scheme for UK businesses, charities, and the public sector until March 2024. While finally having some certainty is welcome, the scheme is a reduction in support and is likely to put otherwise viable small businesses and charities at risk of closure. Though of course community businesses are not ‘energy intensive’ in the same way as food processing or coal mining, we know that many are delivering vital services in poorly insulated buildings. There is a strong case for community businesses, as well as small businesses and charities, to receive targeted support alongside energy intensive industries. The community sector will be monitoring the implications of the reduced scheme closely and feeding this insight into government.

Amidst all this, levelling up has not been forgotten. The commitment to ‘level up’ was reiterated by Sunak, with greater investment in local areas to boost growth and reinvigorate our high streets. This does, however, jar with the lack of inflation-proofing in the levelling up funding in the Autumn Statement. That announcement leaves a £560m hole in these funds by 2025/26, according to IPPR. This risks projects that are already dealing with increased costs not being delivered.

Where the government has made progress on levelling up is on devolution. A new mayor for the North East has been agreed, and it is hoped that Suffolk, Cornwall and Norfolk will follow suit.

Power to Change and the wider community sector have been calling for devolution to go deeper, not just wider. In Starmer’s speech, there were signs that Labour had got the message.

Labour taking back control?

Starmer put forward a critique of centralisation in Westminster, of an ‘economy that hoards potential and a politics that hoards power’. To address this, Starmer placed his tanks firmly on the Conservatives lawn, announcing a Tack Back Control Bill – borrowing the slogan of the Leave campaign – as the centrepiece of Labour’s first King’s Speech, should it enter government. The Bill would devolve powers out of Westminster and give communities a new right to request powers beyond that. 

This is promising, but it requires two notes of caution. The first is that the community sector must continue to push to ensure that power is put in the hands of communities, not just regional and local government, going beyond the town hall. The second is that Labour are still stressing the importance of fiscal discipline. While understandable, this will disappoint many community businesses who know how important resources and capacity building are.

Where does this leave us?

Last week’s political positioning leaves us in a strange place. It can’t be overstated how dire the situation is for many people, and businesses, right now, particularly the least well off. This worry extends to community businesses.

Yet there is still hope. The government will be keen to deliver what it can before the next election. On devolution and high streets for example, we are cautiously optimistic there may be progress. Starmer’s promising language on community power must be met by a concerted push by the community sector to ensure this translates to policy that truly does empower communities. It represents a new political consensus that power must move out of Westminster. The debate is now how far and deep this should go, what structures can enable this, and if resources will be made available too.

It may be that our politics is finally catching up with the communities that have been answering society’s biggest challenges for so long. About time! So, while we can’t guarantee whether Rishi Sunak and Keir Starmer will keep their new year’s resolutions, the community sector must keep ours: to keep pushing our politics to go further and catch up with us.