§ Mrs. Gilroy (Plymouth, Sutton)I beg to move,
That leave be given to bring in a Bill to amend social security regulations with respect to local exchange trading schemes; and for connected purposes.I am grateful for this opportunity to bring to the attention of the House what has been described as the most significant new community development tool of the decade. The scale of this country's voluntary sector is immense. It involves 23 million people—more than the number of people who operate in the economy's formal labour markets. People seek to be stakeholders in myriad ways, combining individual purpose and collective responsibility through a mix of voluntary, community and business activity.In our manifesto we said that an independent and creative voluntary sector that was committed to voluntary activity as an expression of citizenship was central to our vision of a stakeholder society. One of the most imaginative and popular innovations to emerge from the voluntary sector is the local exchange trading scheme movement, or LETS as it is becoming commonly known. LETS are community-based exchange networks that inspire local people of whatever means to pool their skills, imagination, time and resources to create a supportive community of self-help and mutual aid. They do it through a system of community credits, valuing what is given or received in terms of local units of exchange.
Community credits, which are known in their various forms as local or community currencies, time dollars, service credits or service hours, have captured the public imagination and fascinated the media. Each local exchange trading scheme adopts a local name for its unit of exchange: from ideals in Bristol to readies in Reading, from groats in Stirling to exes in Exeter. The names of the units often have strong local connotations. In my constituency, they are called plums after the plum tree from which some people say Plymouth gets its name.
Most LETS involve only up to several hundred members. They bridge the gaps between voluntarism, the market and public sector provision. Like a well-known beer, LETS have the capacity to reach the parts that neither the state nor the formal market economy can reach.
By creating an intermediate, grass-roots social market with their own intermediate social currency, such schemes empower people who are socially excluded to feel that they can make a difference to their lives and to their communities in 101 different ways. They are the essence of social inclusion, valuing people as responsible contributors: as producers rather than passive recipients. They empower people to create their own means of obtaining a hand up rather than a handout.
Exchanges through LETS reflect people's abilities and express their needs. Women often form a majority of members. The most common services involve child care, preventive and remedial health and care services, home produce, arts and crafts, do-it-yourself repairs, gardening, shared transport, personal education and the development of skills through mentoring and peer group support. Exchange of health care services represents 20 per cent. of all exchanges, and in many areas general practitioners refer patients to LETS.
519 The growth of co-operative projects, including food co-ops and tool banks, and the involvement of local voluntary agencies is expanding. There are multicultural projects. About 25 LETS have been established specifically for mental health user groups and for people with disabilities.
LETS renew the social fabric of communities, creating a framework in which everyone's contribution is valued. They enable people to tackle for themselves poverty, community breakdown and social isolation. It is for those reasons that LETS have been hailed by community development professionals as
the most significant new community development tool of the decade".Some of the most far-reaching studies on social exclusion have identified that poverty reduction is by no means solely a matter of income. Fewer chances to hear of work because of reduced social networks, deterioration of skills, lack of ability to acquire new skills—or, having acquired them, to use them—and low self-esteem are all addressed by LETS.LETS offer a social network that includes people from diverse backgrounds, within which exchange takes place. They offer skills development through those exchanges. They offer recognition of worth and value from receiving credits, which demonstrate that what has been done is of value to someone else in the community. People often receive a huge boost to their confidence when they receive LETS credits for their service.
The wide-ranging appeal of LETS arises most fundamentally from that general longing that many people have in today's world for a return to a real sense of community. More than 1,000 LETS have appeared throughout western Europe, with 450 in local communities throughout the United Kingdom covering most towns, cities and rural areas. Most follow the British self-help community development model of LETS that was pioneered by the national voluntary agency LETSLINK UK, which has just been awarded national lottery charity funding to maintain its support of groups nationwide.
LETS are recognised in key policy recommendations in reports of the Commission on Social Justice and the Commission on Environmental Health. The Department of the Environment, Transport and the Regions, the Local Government Association and the Local Government Management Board also recommend that LETS should be nurtured as
core rather than fringe activities.More than 100 local authorities and a growing number of health authorities have embraced LETS and are investing in them as an important new anti-poverty, health promotion and community development tool.Hon. Members may be asking themselves why, given such friends and recognition, LETS need a Bill to promote their interests. There is a growing fear among LETS members whose income derives from benefit—as well as among groups that support and encourage their development—that the DSS may apply inappropriate earnings rules to LETS, treating the credits as though they were money.
Many of the most disadvantaged, who have the most to gain from participating in LETS, depend on incapacity or disability benefits, lone parent benefit or jobseeker's 520 allowance. The possibility that, in gaining credits with very limited purchasing power, they may as a result of local DSS discretion lose the basic cash benefits that are essential for their living expenses has for some time been deterring a large number of people from joining LETS.
That fear has been heightened by a recent DSS circular underlining the possibility that LETS may result in housing benefit deductions. We must take note of the early warning signs that people on benefit who are already members may withdraw from LETS in large numbers if the housing benefit circular is not quickly amended. I know that my right hon. Friend the Minister for Welfare Reform is considering the issue, and I am hopeful that the immediate threat can be dealt with through the simple means of straightforward administrative clarification.
The most cursory examination of LETS will reveal that, in terms of what it will buy, the local credit is patently not the same as money. At face value, the unit may be loosely related to the pound, but it bears no comparison in spending terms and cannot be exchanged for sterling.
LETS operate on a relatively small scale. Unlike the formal market, they do not supply day-to-day goods and services on a regular basis—99.5 per cent. of exchanges are between individuals and the remaining 0.5 per cent. offer only non-regular goods and services for a percentage of LETS. At least 30 independent surveys of LETS bear that out, including two conducted by the Rowntree Trust, and call for amendments involving a blanket disregard of LETS in the DSS regulations.
The recognition of LETS-type community credits has already prompted clarification of the benefits rules in the USA, Australia, New Zealand, Holland and Ireland, where Governments are now proactively supporting their development and promoting them for the unemployed through jobcentres. In America, time dollars are not only exempt from benefit clawbacks: they are guaranteed by the US Government as an intermediate form of supplementary pension entitlement. Over the past two years, the active participation of unemployed people in a time-dollar scheme has been even further enshrined as one condition, for those still seeking work, of entitlement to remain on benefit.
The Commission on Social Justice, a report for the Rowntree trust and leading think tanks, including DEMOS and the Institute for Public Policy and Research, have recognised the potential of LETS for tackling social exclusion and creating a new infrastructure of community support and have been advocating clarification of the benefits rules. My Bill would bring LETS back into the main stream, and I commend it to the House.
Question put and agreed to.
Bill ordered to be brought in by Mrs. Linda Gilroy, Mr. David Drew, Mr. David Lepper, Mr. Paul Goggins, Mr. Andrew Love, Ms Patricia Hewitt, Mrs. Joan Humble, Mrs. Louise Ellman, Mr. Andrew Miller, Mr. Mike Hancock, Mr. Cynog Dafis and Maria Eagle.