On Thursday 21st September the government announced that the technical consultation on the design principles underpinning a Community Wealth Fund (CWF), the new fourth beneficiary of dormant assets funding, would run for 4 weeks until 19th October.
Government has also released its statement of intent regarding funding for the CWF. The Dormant Assets Scheme is expected to release £350 million for England over 2024 and 2028. The government intends to allocate this equally between the four causes, generating £87.5 million for community wealth funds over this period.
Government core objectives of a CWF
- To improve social infrastructure in places with relatively high deprivation and/or low social capital.
- To empower local people to identify needs and make decisions on what is best for their area.
- To contribute to reducing inequalities and enhancing community cohesion and integration.
Delivery
In the technical consultation document, government announced that that The National Lottery Community Fund would deliver the CWF, drawing on the expertise of key partners including members from the Community Wealth Fund Alliance.
Government has now tabled the secondary legislation needed for dormant assets funding to flow to community wealth funds in addition to the existing three causes (youth, financial inclusion and social investment). The Dormant Assets (Distribution of Money) (England) Order 2023 has been laid and is likely to pass onto the statute books in the coming months.
Beneficiary communities under the CWF
Government intends – in the first instance – “for a CWF to target communities in small towns of fewer than 20,000 residents.”
Scope of the technical consultation
The consultation seeks views on the following design principles that the government now considers to be critical to the design of a CWF, setting out a number of options for each principle and outlining the government’s preferred position:
- Whether a CWF should focus on supporting a smaller number of communities with larger pots of funding or a greater number of communities with smaller pots of funding;
- Whether a low level of existing social infrastructure should be required for places to be eligible;
- Whether funding is allocated from a CWF or whether places competitively bid for funding;
- How communities, in the first instance towns, are selected; and
- The nature of local decision-making.
Issues of relevance to the All-Party Parliamentary Group for ‘left behind’ neighbourhoods
The government’s preferred approach to the five design principles are very much in line with the components of the model for a CWF that was outlined by the APPG’s co-chairs in their submission to the government’s original consultation, including that:
- The fund should target disadvantaged areas with low levels of social capital, and that there should be no social infrastructure baseline requirement
- Funding from a CWF should be used to develop the capacity and capability of the beneficiary communities
- A CWF should allocate funding to communities rather than distribution be based on a competitive approach
- Communities should be free to determine the best ways of meeting local priorities
However, the focus on small towns of less than 20,000 risks diluting the operation of the CWF, with evidence heard by the APPG suggesting that a focus area of around 10,000 people is the optimum size for area-based regeneration efforts.
It also means that means that ‘left behind’ neighbourhoods (those wards with the highest levels of disadvantage and greatest community need as measured by the Index of Multiple Deprivation and Community Needs Index) will miss out on much needed investment in the first instance, as the data shows that only 17 of England’s 225 ‘left behind’ neighbourhoods can be found in small towns (7.6% of all ‘left behind’ neighbourhoods).
This means that despite having the highest levels of deprivation and lowest levels of social capital in England, and being ideally suited in size to levelling up through the long-term targeted approach of a CWF, they currently fall out of its scope.
To make a response to the consultation, please visit:
To view the Community Wealth Fund Alliance briefing on these announcements, please see: