Environment and the economy

We decided to amalgamate these two categories on the basis that the human economy now so strongly influences the nature and quality of our surrounding environment that it is the main driver of both global and local environmental change. Therefore we tried to address all economic issues in the context of the question:  how can we best ‘green’ the Cornish economy, but in a distinctively progressive manner?

We examined this question under the five headings used by Neil McInroy: namely, Land, Ownership, Procurement, Workers, and Finance. Ideas from three recent discussion papers issued as part of the 2019 Labour National Policy Forum consultation exercise (A Sustainable Food Policy, Democratic public ownership, Local economic development) were also taken into account. Regarding Cornwall Council policy itself, two key concepts are:

  1. Insourcing. As opposed to the ‘outsourcing’ of services to private contractors which has taken place under recent administrations, this involves taking back ‘in house’ all services the Council undertakes on our behalf, and providing them via direct labour using Council employees whose terms and conditions of service would of course be substantially improved (see below).
  2. Remunicipalisation. The return of previously privatised services (e.g. water, sanitation, transport) to local, regional or national municipal authorities.

It is also the case that if local communities are to be given increased local responsibility for running services, they also need complementary increases in funding, and in political power.

LAND

With its extended coastline, 263, 000 ha of agricultural land (74% of its land area), a fishing industry worth perhaps £50 million per year, abundant if currently little-exploited mineral wealth, and extensive potential for generation of onshore and offshore wind, solar energy, and wave and water power (the latter a neglected resource), Cornwall is an ideal candidate for a policy which seeks to promote increased local and regional sustainability . Such a policy would clearly need to involve promoting increased local production and consumption of food, which should also ideally be produced in an increasingly sustainable manner. Payments to farmers to farm in sustainable ways (perhaps replacing EU payments) and to encourage produce to be sold locally would also be needed, and maybe some kind of levy on the distance food is transported (a Carbon Footprint Tax?), in order to create locally favourable ‘terms of trade’ for local producers. However, these businesses would also need to be able to continue, at least in the short term, to export from the county to larger national and international markets which they currently sell in, especially highly specialist producers.

Switching to local food production for local need implies that building further houses on agricultural land needs to be discouraged. Fortunately Cornwall has a large amount of brownfield land on which many additional houses could be built. Private developers are often against the use of such land as they see it as more expensive to develop, but clearly some means has to be found which encourages them to switch.

In any case, given the failure of the private sector to provide the kind of houses people need, and/or can afford, the majority of new houses should be built by the community for local need. And all new builds, private or municipal, should be both sustainable and built in a sustainable manner. This policy will involve reintroducing the ‘zero-carbon homes’ building regulations brought in by the last Labour government in 2006, and abolished in 2014 by the Coalition. And it is surely the case that no more large buildings, public or private should be given planning permission without being zero-carbon and without plans which maximise their capacity for renewable electricity generation

OWNERSHIP

As far as land is concerned, Cornwall is still in many ways a feudal society, with large estates, not just the Duchy, dominating ownership. Given these, and the large amount of land owned by the County, it was felt that there is an urgent need for an audit of land ownership in the county, with a view to deciding how the land in the county could be best used to the benefit of all. Clearly, use of land owned by the Council can be diverted into local use for local need, but land in private hands is usually not registered until it changes hands. However, there is the possibility that when it does, a Land Benefit Tax could be introduced so that the Council receives a proportion of the transaction. The 2017 Labour Party Manifesto (p. 86) proposed a Land Tax based on the market value of land to replace the Council Tax.

Another potential source of income may be that, during the late 19th century, much Council land was let to private leaseholders at what are now very low rates, and some of this is now valuable real estate. Many of these leases will shortly be up for renewal! It also appears that the Duchy is sometimes able to borrow from the County in order to fund its own commercial developments, rather than use its own resources, which seems odd.

PROCUREMENT

If Cornwall were to switch to something like the Preston Model, has the county the business infrastructure to support such a move? Mention was made of the fact that many SME start-ups fail after a relatively short time, and that the Uniform Business Rate was a major cause of such failures, and should be abolished in favour of a fairer system. However, what Preston and other councils have encouraged is that where individual local suppliers are too small to cope with council-generated demand, they are encouraged to form cooperatives (in line with the ideas in Democratic Public Ownership). Other forms of mutual ownership models, such as social enterprises, and trusts (e.g. the St Ives Community Fund) were also discussed.

How local procurement and insourcing might work is illustrated by the need for a national programme of home insulation to reduce emissions from domestic heating and lift people out of fuel poverty. Nationally, new homes account for just 1% of the total UK housing stock. Most people in the UK live in homes which by modern standards are very poorly insulated. Heating of domestic and commercial buildings is also the largest source of GHG emissions in Cornwall (next to Public and Private Transport). Therefore, we need a major programme of retrofitting of the existing building stock in the county (if not nationally) promoted and funded by the community (or funded nationally but administered locally), using direct labour (i.e. not outsourced!) and local procurement of materials. (The large number of granite houses in Cornwall may require special, local measures).

One interesting fallout from such a programme is not only that materials could be procured locally, but that retrofitting is a labour-intensive process, thus creating demand for a large number of skilled and semi-skilled jobs in construction. The 2017 Labour Manifesto (p. 60) contained a pledge to insulate more homes to help people manage the cost of energy bills.

WORKERS

The UK National Minimum Wage, introduced by a Labour government, is now effectively the maximum wage in many jobs, as employers know that in the current jobs market, they do not need to pay more. The 2017 Labour Manifesto promised to abolish Zero-hours contracts, and to raise the minimum wage so that it is more in line with the National Living Wage (NLW). We need to stipulate that all employees of Cornwall Council be paid at least the NLW, and that in principle, wages etc of all those in local authority employment should be paid at a sufficient rate that they can support themselves and their family, and pay their rent and taxes. We could certainly make it condition of local procurement that we only obtain materials and services from employers who pay at least the NLW, and who respect the right of their employees to join a trade union. Beyond this, we should aim to make Cornwall a place of secure employment in meaningful work at decent rates of pay.

FINANCE

For 2018-9, Cornwall Council has annual spending budget of ca £600 million NET. We need to explore ways in which we can use this budget to build an economy which is both equitable and sustainable, and which meets the needs of all Cornwall residents. Beyond that, there is also the Regional Investment Bank based in Bristol, but bringing decision making nearer home implies that we should press for a Cornwall Investment Bank designed specifically to cater for local need and conditions. Cornwall Pension Fund, administered for Cornwall Council, has some £1.75 billion of assets, and this and other pension funds could be encouraged by various means only to fund, or to give preference to ‘green’ investments. In 2009, the distinguished economist Ann Pettifor suggested that the bailed-out banks should fund the Green New Deal.

However, beyond these ‘top-down’ agencies, the Preston model also employs a Community Wealth Fund model which (a) localises spending thus securing investment in local supply chains and improving local economic competitiveness, (b) builds a skilled and committed workforce and providing an exemplar to local businesses paying at least the Living Wage, (c) brings in additional investment to encourage the development of new businesses, and (d) support the growth of alternative models of economic governance which give citizens greater investment in and control over their economic future. This may be a way to build up local assets and infrastructure outside more conventional sources of funds (which we should also approach!).

All of these sources could be used in some way to fund a programme of ‘greening’ the Cornish economy to make it more sustainable and more equitable, by funding Community Energy schemes and starting up businesses run on cooperative lines feeding in to local procurement. Some of this can be done already, as seen at Preston and other cities. Some of it would need a change of government.

Local Economy

All procurement exercises should have a positive weighting for local supply and additional weighting for local cooperative or mutual tenders.

Tenders from the private sector should only be permitted where the contractors and all sub contractors  meet  licence requirements  which would include payment of at least the national minimum wage, the right to organise in trade unions and proper contracts.

There should be a full carbon audit of all Council activities followed by an action program for alleviation.

Research and Development

Developing a green economy will involve the most massive shift of resources since the Second World War.  Huge opportunities exist not least in research and development.  We will seek to  re-purpose Cornwall’s higher and further education institutions so as to better support the training and research needed to deliver a Green economy in Cornwall.  Particular areas for investment and research include green construction (use of hemp), smart energy networking and methane reduction in agriculture.