Y Pwyllgor Llywodraeth Leol a Thai

Local Government and Housing Committee

07/07/2022

Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Carolyn Thomas
Jayne Bryant
Joel James
John Griffiths Cadeirydd y Pwyllgor
Committee Chair
Mabon ap Gwynfor
Sam Rowlands

Y rhai eraill a oedd yn bresennol

Others in Attendance

Ben Lloyd Pennaeth Polisi, Cyngor Gweithredu Gwirfoddol Cymru
Head of Policy, Wales Council for Voluntary Action
Casey Edwards Cynghorydd Tai Cymunedol, Cwmpas—Canolfan Cydweithredol Cymru
Community-led Housing Advisor, Cwmpas—Wales Co-operative Centre
Chris Cowcher Pennaeth Polisi a Chyfathrebu, Sefydliad Plunkett
Head of Policy and Communications, Plunkett Foundation
Eleri Williams Swyddog Polisi, yr Ymddiriedolaeth Adeiladu Cymunedau
Policy Officer, Building Communities Trust
Geoff Bacon Pennaeth Gwasanaethau Eiddo, Cyngor Abertawe
Head of Property Services, Swansea Council
Harry Thompson Arweinydd Polisi Economaidd, Sefydliad Materion Cymreig
Economic Policy Lead, Institute of Welsh Affairs
John Rose Cyfarwyddwr i Gymru, Cronfa Gymunedol y Loteri Genedlaethol
Director for Wales, National Lottery Community Fund
Jon Rae Cyfarwyddwr Adnoddau, Cymdeithas Llywodraeth Leol Cymru
Director of Resources, Welsh Local Government Association
Lyn Cadwallader Prif Weithredwr, Un Llais Cymru
Chief Executive, One Voice Wales
Natalie Sargent Rheolwr Datblygu—Cymru, Ymddiriedolaeth Adfywio'r Meysydd Glo
Development Manager—Wales, Coalfields Regeneration Trust
Richard Harries Cyfarwyddwr Cyswllt, Sefydliad Astudiaethau Cymunedol
Associate Director, Institute for Community Studies
Tom Chance Prif Weithredwr, Rhwydwaith Ymddiriedolaethau Tir Cymunedol
Chief Executive, Community Land Trust Network
Tom Stainer Rheolwr Ymgyrchoedd, CAMRA
Chief Executive, CAMRA

Swyddogion y Senedd a oedd yn bresennol

Senedd Officials in Attendance

Catherine Hunt Ail Glerc
Second Clerk
Chloe Davies Dirprwy Glerc
Deputy Clerk
Jonathan Baxter Ymchwilydd
Researcher
Manon George Clerc
Clerk
Osian Bowyer Ymchwilydd
Researcher

Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.

The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.

Cyfarfu’r pwyllgor yn y Senedd a thrwy gynhadledd fideo.

Dechreuodd y cyfarfod am 09:15.

The committee met in the Senedd and by video-conference.

The meeting began at 09:15.

1. Cyflwyniad, ymddiheuriadau, dirprwyon a datgan buddiannau
1. Introductions, apologies, substitutions and declarations of interest

Welcome, everyone, to this meeting of the Local Government and Housing Committee. Item 1 on our agenda today is introductions, apologies, substitutions and declarations of interest. This meeting is being held in a hybrid format, and aside from the adaptations relating to conducting proceedings in hybrid format, all other Standing Order requirements remain in place. The public items of this meeting are being broadcast live on Senedd.tv. A Record of Proceedings will be published as usual. The meeting is bilingual and simultaneous translation is available. Are there any declarations of interest? No. 

2. Papurau i’w nodi
2. Papers to note

We will then move on to item 2, papers to note. We have two papers. Paper 1 is a letter from the Welsh Cladiators group in relation to building safety, and paper 2 is a letter from Gareth Wilson to the Minister for Climate Change, copied to the committee, in relation to the leaseholder support scheme, relating to building safety. We will of course be returning to these matters in short order, but, are Members content to note these papers at this stage? Okay. Thank you very much.

3. Cynnig o dan Reol Sefydlog 17.42(ix) i benderfynu gwahardd y cyhoedd o'r cyfarfod ar gyfer eitemau 4 ac 8
3. Motion under Standing Order 17.42(ix) to resolve to exclude the public from the meeting for items 4 and 8

Cynnig:

bod y pwyllgor yn penderfynu gwahardd y cyhoedd o eitemau 4 ac 8 o'r cyfarfod yn unol â Rheol Sefydlog 17.42(ix).

Motion:

that the committee resolves to exclude the public from items 4 and 8 of the meeting in accordance with Standing Order 17.42(ix).

Cynigiwyd y cynnig.

Motion moved.

Item 3 is a motion under Standing Order 17.42 to resolve to exclude the public from items 4 and 8 of today's meeting. Is committee content to do so? Yes. Okay. We will then move into private session.

Derbyniwyd y cynnig.

Daeth rhan gyhoeddus y cyfarfod i ben am 09:16.

Motion agreed.

The public part of the meeting ended at 09:16.

10:30

Ailymgynullodd y pwyllgor yn gyhoeddus am 10:30.

The committee reconvened in public at 10:30.

5. Ymchwiliad i asedau cymunedol: sesiwn dystiolaeth 1
5. Inquiry into community assets: evidence session 1

Okay. Welcome back, everyone, to our committee meeting today, and now a public session. Item 5 is our inquiry into community assets, and our first evidence session, with Harry Thompson, economic policy lead with the Institute of Welsh Affairs, and Casey Edwards, community-led housing adviser with Cwmpas, Wales Co-operative Centre. Welcome to you both, and thanks for coming in to give evidence today. Perhaps I might begin with some general questions, and, firstly, what you consider to be the main benefits, opportunities and social value involved with community-owned or managed assets—what they can bring to our communities.

Do you want to go first?

Yes, I'm happy to go first. For me, I think it's quite clear that some of the benefits—. I know that Building Communities Trust did research a couple of years ago into how community assets can impact on a community, and it ranged from improving community cohesion to providing employment, skills and training opportunities and better health and well-being outcomes, because, obviously, people are getting together, socialising. We all saw the benefits of community activity during COVID, so I think community assets can really help with that. And it provides a place for communities to meet and to socialise and to take social action as well. Communities aren't passive—it provides a space for them to come together and actually take action in their local communities.

It also helps with the foundational economy agenda, obviously, providing services locally, and these community spaces can actually host those local services—so, for example, maybe a post office or a food bank; community initiatives will often host these kinds of initiatives. And I think it will help young people to stay in their local communities, obviously, by providing not only social activities, but employment opportunities; that will help to keep young people, and other people, in the local community. And I think, obviously, with my community-led housing hat on, providing affordable housing, again, will also help to keep young people in the community.

We did some research a couple of years ago into the softer outcomes that come with community-led housing. It ranged from helping to tackle loneliness and isolation, because, obviously, people come together and socialise with their neighbours a little bit more, to helping people to increase their confidence and their skills. The benefits of community-led housing are very wide-ranging, above and beyond providing an affordable roof over people's heads. And—. Sorry, Harry, if I could just finish. [Laughter.]

And the social value aspect, these community initiatives have that social value at the heart of everything that they do; it's not an added extra, it's not a nice-to-have, they live and breathe social value. And the reason that the majority of these community initiatives were set up in the first place was to benefit the wider community—that is their first aim. It's not a political or profit-making exercise, it's to better their local community.

I can't put it better than that, really. The benefits will depend on the kinds of projects. I think that communities can reshape the area they live in via the assets that they take control of. You've had the example of community-led housing, but also parks, shops, renewable energy, and those all give different benefits. I think the core of it, and what binds it all together, is that it gives communities a tangible say in what their local areas look like, rather than it just being dictated to them by the market. I think the point about community cohesion was really important too. Communities with a big affordable housing problem can build housing owned by the community for the long term; we've seen examples of that. You could combine that with things like remote working hubs, in the post-pandemic world. And a combination of those things could allow young people to pursue careers in places they're from, which is one benefit. So, to sum it up, it's really about communities shaping their own futures, and the possibilities of that are endless.

Okay. Thank you. In terms of the pandemic, we have seen a new emphasis, a new concentration on localism, in a way, haven't we? Touching on many of the things that you've mentioned, and you mentioned, Casey, about people being isolated and lonely, but during the pandemic, perhaps, neighbours taking more of an interest in elderly people and vulnerable people in their communities and helping them more, and just being more aware of their local areas and what's there and building more community cohesion, because they were shopping locally and bumped into each other more and got to know each other, where perhaps they didn't previously. And working from home, walking more locally and using local green space and so on, there was a lot going on there for an extended period of time, really. Maybe it's quite early days, but do you see any real impact from that in terms of community-owned assets and what is developing and might develop from this point?

10:35

Certainly, from our perspective, with the Communities Creating Homes programme, we definitely saw an increase in enquiries from particularly isolated rural communities who—. Like you said, we were all confined, weren't we, to our local areas? So, maybe the lack of affordable housing really became pertinent to many people, or the lack of community space. So, yes, we definitely saw an increase in demand for community-led housing and people wanting to have more of a say, I suppose, in their local area, because we did spend so much time confined to our local areas. People, I think, now feel a bit more empowered to be able to do something and because communities got together during the pandemic and really made change happen, I think that that's proved to them that they can actually do it. So, I think we need to harness that power essentially and build some support infrastructure to really move that forward, essentially.

Yes. I think 'harnessing the power' is exactly the right phrase. I think, not just in the pandemic, but also before it, there was so much energy in communities in Wales. It's a country of a lot of big communities, but also small ones, a lot of small, tight-knit communities, where everyone knows everyone. And I think, in terms of community empowerment measures, it's a place that has really fertile ground for that to get a lot of outcomes out of it.

Okay. Thank you very much for that. If we move on then to a possible register of community assets across public, private and voluntary sectors and what benefits that would bring, and why existing data sources, such as land registry, local authority and Welsh Government data are not sufficient; could you expand a little on the evidence that you've already provided on that, please?

I think the current data sources, as useful as they are, they're all quite disjointed and quite complex and it's quite difficult, often, to be able to access the information. Some of it, obviously, comes at a cost; you need to pay for some of the information, which is understandable. But I think if you're just a community member wanting to find out who owns an asset or a piece of land in your community, it's really quite difficult to do that. There are lots of different services and registers that you would need to tap into to get that information. So, I think that we just need a really simple place where all of this information is held, and I think we need to understand who owns the land and the assets around us. I think if you wanted to find out the owner of a residential property, it's often quite easy to do that, but if you want to find the owner of a piece of land or a community asset, then it's really difficult. We've had so many experiences of groups ringing around landlords trying to find out who owns a property that they end up giving up, or they try and look for a different asset to utilise. And often, the landlords are absent, so, again, that puts another barrier in front of communities, doesn't it? Or they don't even live in this country, so that can make communicating and finding them even more difficult.

So, yes, I do think that we need just one register that can have all of this information, not only in terms of who owns the land and the assets and properties, but any planning requirements or planning permissions that are joined to that asset and that land, and any covenants on the land—all those kinds of elements. It's not just about ownership. And I think that there are voluntary groups that have tried to map who owns Wales; there's the Who Owns Wales? website, which is obviously a starting point, but I think the people running that are volunteers and are very busy to be able to actually pull something useful together. So, I think it's really important that we have a well-resourced database that contains all of this information.

10:40

Yes, and Harry, the IWA's call for a register of community assets, is that on the same page or is what Casey's proposing beyond that?

No, no. It sounds exactly like what we're proposing. I think that we've spoken to a lot of communities too that have had problems finding out who owns assets, and I think that when you are trying to do something on a voluntary basis with no funding to start off with, that can be a first hurdle that you can't get over straight away.

I would say that a register of community assets is useful for those reasons, but in a limited way. There's also the issue of keeping track of what's happening to community assets. We've just had a big period of sell-offs of public and private assets and we don't really know what's happened to them because we've not had that register. So, I think it is useful in a limited way, but I think that the real benefits of keeping a register of community assets, in our opinion, is more about what you do with it. So, in Scotland and England, once those assets are registered, communities have to be notified about any potential transfer or sale, and they have those statutory rights to bid in England and to buy in Scotland. So, I think the register of community assets, in my opinion, is useful in that limited way, but more of a step to the end goal of real community empowerment measures, where you take steps to get those assets in the hands of communities if they want them or to stop them being lost. That's not to say that the register isn't useful; it clearly does have use. But you're certainly not going to get the full benefit if you don't use it, also, to empower communities in a tangible way.

Yes. Okay, that's great. Thank you, both, very much.

Moving on to support and advice. Obviously, community groups taking on a community asset, or wanting to develop it, face quite a few challenges. It can be quite daunting, I'm sure. So, in terms of the support and advice that they should have as community groups undertaking these sorts of projects, what would you say in terms of what's currently available and its adequacy and what should be available, and obviously that would include community-led housing? Is sharing of best practice something that tends to happen or not?

I'm happy to go first. Obviously, community groups need support, ranging from that visioning and getting together as a group and coming together as a cohesive group to develop your vision, all the way through, then, to the actual technicalities of managing and running an asset, and then even succession planning. Often, you find a life cycle with community groups, so it's important to bed in that succession planning. Often, when you think about the support that communities need, you think about that technical support in terms of finance and management—where are they going to get the money and the planning from? That kind of thing. But it's also important to think about the softer skills in terms of conflict resolution. Inevitably, a community might have a disagreement about how some things should be run or managed, so I think you have to build in those conflict resolution policies into any of these community initiatives and really empower people to think about how they make decisions as groups as well. Obviously, coming from Cwmpas—and formerly the Wales Co-operative Centre—I'm going to advocate for co-operative approaches, so I think that's really important.

There is a lot of support available out there at the minute, through Cwmpas, through ourselves, through our social business Wales programme and community shares, but there's also the Wales Council for Voluntary Action and all of the third sector support that comes with that. So, I do think that there is quite a lot of support out there for communities, and from a community-led housing perspective, obviously we are the hub for that in Wales, so we can help communities through that community-led housing journey. But I do feel that we need a more co-ordinated response, I suppose, to communities taking over assets, and especially maybe from a local authority perspective. Often, the support from local authorities is quite—. It varies across Wales. So, it would be nice to have a more co-ordinated response. And then, perhaps those officers and local authorities could signpost to the more detailed support that's available, perhaps, from us or other organisations across Wales. And I think that the value of networking is really important with these kinds of projects and peer support as well. You can talk to experts and you can talk to people who can help you with certain financial elements, but I think having a relationship with a peer who has maybe been through the process is really invaluable, so I think having some form of peer network would be really helpful for community groups going through this process.

10:45

And that would help spread the best practice as well.

Exactly, yes. Those peer networks can help spread best practice, but also the networks of, maybe, local co-ordinators, organisations such as us, WCVA, Building Communities Trust. If there was that group that came together to specifically focus on community assets, I think that would be really helpful.

So, the co-ordination is pulling together those involved at the moment.

I think, when it comes to support, there are two things to talk about: I think there's support in acquiring assets, and I think there's post-acquiring support. It's something we look less at—we mainly look at frameworks—but one thing that's really clear is that that support is important, especially if you're going to go down the road of empowering communities to take assets in a more systemic way, because there's no point giving assets to communities if they're just going to collapse afterwards.

I think, in terms of the support for taking on assets, what we'd say in terms of publicly owned assets through the community assets transfer process is that consistency is a real issue, and that best practice spreading you spoke about. I think the Welsh Government's own research showed that only a handful of local authorities actually had a dedicated person for community asset transfers, and the stories we got when we spoke to communities were really negative, actually. They often said there wasn't a clear process in practice for community asset transfers. We spoke to one community group—and this gives the example of how those systems are really important, because they got a bit of funding, and the funding situation does tend to be the best element of the package of community support in Wales—who got a bit of seed funding and then they started negotiating with their council to take over a piece of land in a deprived area that had seen a lot of local facilities close and they wanted to do something for the community. And then, after five years, when they got accepted to take over that piece of land, the seed funding was just running out. They were developing it, and then, one day, they turned up and a different council department had changed the locks on it and said, 'No, you don't actually have the right to access this piece of land.' They did manage to resolve it eventually, but they said, at the time, because the funding was running out, they basically thought it was over, and five years' work was done, was finished. So, I think that just shows how the framework of community rights, the funding and the support network all need to come together in one package, because if you don't have proper systems and processes, then it doesn't matter if you have a good funding package, because that funding is going to run out—because they can't budget, they can't make a timeline.

No. Okay, and in terms of variation across Wales, and particularly urban as opposed to rural, and more deprived communities compared to more affluent communities, the barriers and challenges are different. Is that going to be a real problem to take forward the sort of improvement and development we'd like to see?

I think investment needs to be made in those communities that people do consider deprived, because often they may not be aware of these kinds of processes and they may not believe that they can take on these sorts of assets because they've just been so disengaged for a long time. So, I think further investment needs to be made in these communities. Research in England shows that, exactly like you said, people living in more affluent areas are more likely to be able to take on these projects. Often, they might be retired professionals who have a little bit of time on their hands and want to do something good in their community, and, obviously, there's absolutely nothing wrong with that, but we need to balance the power, essentially, for deprived communities to have the same opportunities as more affluent areas.

And the same goes for rural and urban comparisons as well. I think those two examples have different issues. So, for example, in an urban environment, it might be quite costly to actually buy the asset upfront. In places like Cardiff, for example, if you wanted to buy a building, it's probably going to set you back quite a bit, really, but then you may be able to have a more sustainable business model to make money long term, whereas in a rural setting, the asset or land might be cheaper itself, but then the ongoing financial sustainability might be difficult. Again, in deprived communities as well, obviously, some community projects will want to provide food banks, like I said earlier, and those community initiatives that don't necessarily make money. So, again, that makes it difficult for them to have that cash flow and income to be able to sustain their projects. We need to think about all of these different barriers and to give investment into those deprived areas to make sure that they can be as successful and sustainable as examples in more affluent areas.

10:50

I think there are lots of differences between urban and rural areas in terms of assets, and there are some similarities as well. In urban areas, you've got real problems with the profit motive clashing with what the community wants. In a lot of areas, is it more profitable to knock something down and put student flats there? Maybe. But, does the community want it and do they get a real say in it? Probably not, without community empowerment measures. In rural areas, they have other pressures, as you'll know, such as skyrocketing housing prices and a lack of affordable housing. So, community-owned housing is useful in urban and rural areas, but it's particularly a potential lifeline for rural communities.

In terms of affluent versus deprived communities, there are big differences. Affluent communities will have a lot more money in them, clearly, but also probably more spare time. If you've got a community that's got solicitors, architects and accountants, they're going to have more capacity to donate their skills and time more comfortably than a single mum of three kids who doesn't have a spare moment and is trying to make ends meet. So, if you leave everything to the market, it's affluent communities who would have more money for legal challenges and, often, more time to volunteer.

I think if you empower communities with discernible rights, it's the more deprived communities who are going to disproportionately benefit, because they need that power more. They also need the benefits of community assets more, I think. That might be trying to create something that revitalises declining high streets, it might be trying to create that affordable housing we've spoken about. They're far more likely to be trying to solve problems in their communities that affluent communities just don't have.

Okay. Thank you, both, very much. We turn to Sam Rowlands. Sam.

Thanks, Chair. Morning, both. I hope you're having a good day so far. I appreciate your time coming here to this committee. I just want to talk about funding a little bit. In the evidence you've provided, you mention funding. Casey, from you, you talk about access to capital, and, Harry, you talk about recommendations around a community asset fund. I just wonder if you can perhaps initially speak to those points around funding and some of the challenges that organisations might have.

Yes, sure. I think, to help community-owned assets really thrive as a sector, you need the three things I mentioned: power for communities to take on assets, you need those tailored support systems to help them thrive, and you need funding. In terms of those three, I think it's funding in Wales that's in the best place. The Welsh Government community facilities programme does a lot of good work, as does the National Lottery.

It wasn't something that came through hugely that communities had huge complaints about accessing that initial funding; it was more about the flaws in the systems that do exist, or the non-existence of systems in other places. I touched on it a bit earlier. That lack of system could mean that you can't budget properly and that can have a knock-on effect on funding, as an ill-defined process can make it really hard to plan, and funding will be slowly whittled away. Access to that initial funding wasn't a significant issue that was raised with us, but there are obviously issues with communities' ability to compete with other potential buyers with very deep pockets. Again, that's less about the initial funding and more about systems. If you're in Wales at the moment, trying to buy a privately owned community asset, essentially, you're in a situation where you're just a group of people; you're not a legally established entity, you don't have any funding, you don't have any staff. That asset comes up for sale and a buyer with deep pockets says, 'I'll give you this in cash now, we can transfer it and we can do the sale'. That community group has to go through that process of establishing itself legally and trying to get funding. No-one's going to give money to something that doesn't exist as a legal entity. So, it's less the initial funding that's the problem, and it's more that the systems don't allow communities to compete on a funding level.

Do you think money should be given to groups that don't exist, then?

Not necessarily. I think there are better options for it. I think, in England, you've got that community right to bid, where, if it's a registered community asset and it comes up for sale or transfer, they can basically trigger a six-month moratorium, and that gives them time to establish themselves a legal entity and to get funding. And then, in Scotland, that's even stronger; you've got the right to buy, essentially. They have the first right of refusal on the asset. So, I don't think we necessarily need to go down the road of giving funding to non-legally established organisations. I think there are better solutions to it.

10:55

Yes, again, it's a sort of systems issue, as well. Like Harry said, there's quite a lot of seed funding for community initiatives, but sometimes it's even a step before that that can be a challenge for groups. We've had groups who have had difficulty even opening a bank account, because they don't have the funding to be able to maintain a business bank account, but then they're less likely to be able to open a bank account with a high-street bank because they just don't recognise—a lot, in our case—social enterprises, so there is that initial barrier that they come across straight away. And for new start-up groups as well, often it's just difficult to access that seed funding, because obviously they don't have as big of a track record as an established organisation that's been running for 10 years. So, those barriers are a challenge for groups instantly, without even considering, then, the seed funding.

Again, like Harry said, the timescales can jeopardise grant funding. We've had several examples where a community group has managed to successfully apply for a grant and then, because of the challenge of actually acquiring an asset or a piece of land, that grant funding has essentially run out, or they need to give it back, essentially. And again, like Harry said, the competition with private investors and developers is just—. There is no competition, essentially. You can't compete with these people.

And from a community-led housing perspective, for our groups it's really difficult for them to access pre-development finance—so, getting together and applying for planning, getting architects' drawings, feasibility studies, surveys and everything like that. Once a group has a piece of land or an asset that they would like to convert to housing, there are finance options available to them from ethical banks and community lending as well. So, it's that pre-development finance that we find for our community-led housing groups is a real challenge. So, I think, if we want to empower communities to take on these assets, we need to take all—. Finance doesn't just come as one package, does it? It comes at different stages, so we need to think of all of these stages.

A lot of our community-led housing groups are reliant on philanthropic landowners or property owners reducing the cost of properties for them to be able to buy it, and holding it off the market so that they don't have to compete with private developers. There are some great examples from Scotland, like the Scottish land fund and the rural housing fund, which have been absolutely transformative for community ownership and rights of assets and which have enabled people to not only deliver community assets but housing as well—affordable housing.

Yes, thank you. Thanks for that. I read in the evidence, I think, Casey, from your side in Cwmpas—. I think there's a bullet point here about the,

'Lack of a single financial pathway for making multiple applications to different funders.'

In the evidence we experienced, I think it was just last week, as we did some site visits as a committee, that certainly came through in terms of having to line up all these different grants and making sure it all adds up, and it looked really complicated and quite burdensome, I suppose. Perhaps you'd want to just talk about that in a moment as well.

I'm just interested in the lending side. You mention that high-street banks or finance organisations sometimes are reluctant to lend to these types of organisations, so it would be interesting to hear a bit more about that. 

Then, thirdly, do you think there is a stronger role for someone like the Development Bank of Wales to play? I heard perhaps anecdotal evidence that some of the offers that they've provided for similar groups have quite substantial interest rates, and you would have thought the Development Bank of Wales or organisations like that might want to treat these organisations slightly differently. I don't know. So, any thoughts on that lot would be great. Thanks.

Yes. In terms of the multiple funding streams, that's absolutely the case for community-led housing groups. One of the first things we say to our community groups, essentially, is, 'You will not get the funding from one source.' That is just completely impossible. And we are talking about developing houses at the end of the day, so obviously it's a costly exercise. So, a lot of the time, our funding groups will not only tap into grants for that sort of early-stage support and seed funding, they'll then also look to maybe sort of community share options, maybe loan stock options, which are similar to community shares, but for co-operatives, and then they'll maybe look at soft loans from local government and the Welsh Government if at all possible. And then to finance the sort of long-term build, they'll apply for a mortgage, essentially, so that'll come from usually an ethical bank, so Ecology Building Society, Triodos. It's just a case with the high-street banks that a lot of the time it's just lack of awareness; they're not aware of these different approaches to building housing, they're not aware of the different approaches to businesses, they're quite familiar with the standard company limited by guarantee, but when you start talking about co-operatives, community benefit societies with open membership where communities members can join and vote, banks just don't really understand those kinds of processes. So, I think there is definitely an exercise needed to educate banks about all of these different approaches to housing and business, and we as Cwmpas have done some of that, but, obviously, these banks are quite large organisations, so it's sometimes beyond us.

So, I think that's one of the main issues with high-street banks, and as well, even with some of the ethical lenders, the interest rates on those can be extremely high as well, which can make these projects unsustainable. We are having discussions with the Development Bank of Wales, especially on their self-build programme, and trying to get them to recognise that co-operative housing could link to self-build, and that could be an approach for them. We haven't had many groups being able to tap into funding from the Development Bank of Wales, and, again, it's just actually getting them to that stage to be able to apply for the loan, because that predevelopment finance just isn't available.

11:00

I think the multiple sources thing is something that came up with us as well. It was fed back to us by community groups that it would be really simple just to have one pot of money that they could go to for grant or loan funding, similar to the Scottish land fund, which is for all community assets, not just land—it just started off as a land fund. So, I think having one simple pot of funding would just help to reduce that admin time we've talked about, particularly for deprived communities who don't have a lot of time to be doing all of this stuff. I think it's really important that you just make the process as simple as possible. And I think the Welsh Government's community facilities programme is a good start on that, but I think there are a lot of other little pots of money; it's a bit more of a complicated system in Wales. But like I said, I think the funding thing came through less for us than systems and their impact on funding bids.

Thanks. I'm really conscious of the time, Chair, so I'm happy if you want to move on.

If you've got something else you'd like to raise, Sam, that's fine.

Okay, thank you. Just really briefly, then, and perhaps just for brevity, I'm just interested in the opportunities that community ownership presents for community-led housing and funding in particularly, and you touched on it a moment ago, Casey. But housing, specifically around affordable housing—how funding could be accessed to develop that side of things.

Like I said, currently, it's a case of ethical mortgages from high-street lenders. Our groups—

Sorry, are there non-ethical mortgages, then? You mentioned ethical banks; which are the non-ethical banks?

So, just your high street—

They're all non-ethical? None of them have ethics? Is that what you're saying?

I'm not quite saying that, but, obviously, a lot of them invest in oil, in the middle east and things like that and a lot of our groups don't agree with those values. So, we have ethical banks that particularly focus on green initiatives and community initiatives as well. I'll have to check with their values to get back to you on that one.

So, that is often an option for our groups, and, again, our community-led housing groups can work with housing associations in Wales to tap into social housing grants available from the Welsh Government, and some groups are happy to do that, but also a lot of groups want to have some independence, they don't want to have to rely on working with a housing association to be able to provide affordable housing, so their finance options are less—. And, obviously, when you're applying for a loan as opposed to a grant, that again makes it difficult for finances to stack up, especially with the cost of buying land and assets at the minute—that makes it incredibly difficult to be able to get a loan to provide affordable housing.

11:05

No, nothing to add to that.

Thank you for coming along today. Your knowledge is really amazing, so I've learnt so much from you today. I think you've covered the questions I was going to ask you as well. They were really about consistency of information that's been provided to these groups through local authorities and—[Inaudible.] So, how consistent is it? But you've already said it's not consistent at all. Could I ask how involved the Wales Council for Voluntary Action, the local voluntary councils, are in helping communities, as well as local authorities, with providing that knowledge, access to grants and funding, constitutions et cetera, in your experience? 

I'm not sure about any specific examples about the WCVA, although they've been really helpful with drafting my report. They're really knowledgeable in this area. But, yes, I'm not sure where they work with communities directly.

Certainly, in terms of community and housing, we often refer our groups to work with their local council for voluntary service, because, obviously, they're very informative about funding opportunities and things like that. They've been incredibly helpful, and for our social business Wales project as well, we've got a very close relationship with them. In terms of the consistency, we had an example where a community group had an agreement to take on an asset, and then there was a change of personnel within the public body that they were going to get the asset off, and everything went back to square one, essentially. So, there wasn't that policy that people could refer to to say, 'Okay, this is going to happen, essentially.' So, yes, obviously it's incredibly difficult if the personnel changes within that public body, to then have to start from scratch, essentially. 

Do you think, then, there needs to be a national framework where people can go for information, like a national library on all these things, maybe online? Or do you think that it varies so much in areas—you know, we've got 22 local authority areas, haven't we? So, do you think it varies so much anyway and that it should be like local information, or both? And also, I was going to ask about the social value element as well. You touched on that quite a lot earlier—the importance of it. Profit versus community et cetera. Because we've heard from stakeholders that they've been interested in buying a community asset, but people with deep pockets, as you said, have pipped them the post. But that can sometimes be like—. Very often, it seems to be banks, which are in public ownership anyway. So, just a little bit, really, on those things.

Yes, sure. Our fourth recommendation was actually that the Welsh Government should adopt a social value policy that applies to public bodies, looking to the disposal of all lease, land or assets. Under the, I think it's the General Disposal Consent (Wales) 2003 Order, public bodies can give assets away for less than market value, or less than best price, but the feedback we've had from a lot of stakeholders is that they feel very nervous about doing it and that it's not necessarily communicated. So, we think that that social value policy should be auditable in particular, because I think a lot of public bodies are really worried about being audited and giving away assets not for the best price. So, we think it should be auditable and communicated clearly with local authorities, public bodies and Audit Wales. So, you've got the national TOMs framework, which is theories, outcomes and measures framework, which gives an auditable way of doing this, and we recommend that that should be used as a starting point to develop that social value policy.

I think there's a bit of a disconnect at the minute in terms of the guidance from Welsh Government and then the implementation of asset transfers on a local authority level, so I think that needs to be better connected. I agree that there needs to be a standard process, a standard practice, but also allowing flexibility, because, obviously, each local authority will experience different challenges, so at the same time it needs to be flexible.

And I think, in terms of the social value, we've heard that, often, local authorities will dispose of liabilities not assets, making it really financially unsustainable for communities to create that social value, essentially. So, yes, I agree that social value needs to be considered. In Scotland they're actually putting a reform forward to the Land Reform (Scotland) Act 2016 to have a public interest test on sales of land and assets. So, that just shows that, obviously, they're thinking about social value. And in terms of examples of local authorities disposing of assets at less-than-best value, lots of local authorities across England do it already, especially for community-let housing. So, Bristol have a huge land disposal policy that allows them to lease and dispose of land for community projects. So, it's happening across the UK, essentially, so I think we just need to catch up a little bit in Wales.

11:10

Does it vary much as well on area, on—? Because you need sustainability as well, don't you, going forward? So, if a group, like you said, takes on an asset and then it fails after a few years, does it vary whether or not the local authority will take it back or help along the way—hand-holding? Because you need leadership, don't you? Somebody strong. We found that out in places we visited. But then, if there's an issue with that asset, would local authorities maybe take it back? Have you seen evidence of that as well going forward, so it's not lost? Somebody else can take it on, basically, you know.

I don't know if I've seen specific examples of that. I think one thing is that you need that funding package. If you take it on, you need a support package to make sure it succeeds. I think one thing that's an uncomfortable thing to say but should be said is that some of these things will fail. Some businesses fail. If you're taking over a pub, some pubs fail, and it just happens. I don't think we should expect 100 per cent success rate from community ownership either. But I think the evidence—I think it's from the Plunkett Foundation—shows that you do actually have really high success rates. I think, going back to the system, because it's my favourite topic, I think one of the things that an improved system in Wales would help is the fact that, like Casey said, you get a lot of—especially during the austerity era of public finance restraints, you basically had local authorities offloading the ones that were most expensive to run, essentially. And if you had a better process that was community led, so communities could put their hand up and say, 'We'd like that, that's a good asset', rather than one that's disposal led, you would probably see better quality assets going to community groups rather than ones that were already struggling and being offloaded, really.

Okay, thank you. Casey, do you want to add something?

In terms of what happens if something fails, I think there are governance structures that can be put in place to make sure that that asset isn't lost to the private sector. So, certainly, in terms of our affordable housing projects, there's always a clause in there that, if a community-led project fails, then it would be disposed of to maybe a like-minded organisation or it would go to the local authority. And even covenants on the land title as well, which says that this land always has to be used for affordable housing. So, I think there are mechanisms in place that you can put on these types of projects to make sure that they're not lost, then, to the private sector and for profit makers.

Can I just ask one more question? So, sustainability going forward: how important do you believe a small bit of revenue funding, seed funding is? Because very often, they're not just for profit if they're community as well. That social value again would be part of it rather than just profit. So, how important do you think that should be as a measure, and do you think that some funding should be available, just so that it ensures that there's somebody there leading, and being funded, to keep it going forward and make it sustainable? Do you think that should be an element of it as well going forward?

Yes, absolutely. You know, I think that, like I've said, seed funding and the pre-development costs that I've mentioned earlier as well—they're all part of it. And, yes, the leadership and support is a crucial element. And I do think that social value should come into play when we're talking about disposing of these assets, whether that can be a measurement tool—I think that's really important, and I think the majority of community groups would want to have that element for their project anyway.

Helo a bore da. Diolch yn fawr iawn i chi i gyd am ddod ger ein bron ni. Mae wedi bod yn sgwrs ddifyr iawn hyd yma. Gawn ni wirio bod y cyfieithu'n gweithio? Mae'r cyfieithu'n gweithio, ydy? Penigamp. Iawn.

Dwi'n ffodus iawn yn fy nghymuned i, yn yr ardal dwi'n ei chynrychioli; mae gennym ni nifer o fentrau cydweithredol cymunedol sydd wedi hefyd cymryd asedau o'r sector breifat ymlaen, os meddyliwch chi am dafarndai yn cael eu cymryd drosodd yn Llan Ffestiniog, Nefyn, Llanystumdwy, Llithfaen ac yn y blaen. Mae cymuned Pennal yn edrych i gymryd tafarn ymlaen hefyd. Ond mae yna heriau yn wynebu mentrau cydweithredol a chymunedol sydd eisiau cymryd ased o'r sector breifat. Felly, oes gennych chi farn ar beth ydy'r heriau yna sydd yn rhwystro cymunedau rhag cymryd perchnogaeth ar ased o'r sector breifat a pha gamau dylid eu cymryd er mwyn hwyluso'r broses o gymuned yn cymryd ymlaen ased o'r sector breifat?

Hello and good morning. Thank you very much for joining us. It's been a very interesting conversation so far. Can I just check that the interpretation is working? We'll just check interpretation; you should be able to hear that come through now. Thank you. Yes, I see it is.

I'm very fortunate in my community and the area I represent; we have a number of community co-operative initiatives that have taken on assets from the private sector—we've heard about pubs being taken over in Llan Ffestiniog, Nefyn, Llanystumdwy, Llithfaen and so on. The Pennal community is looking to take on a pub as well. But there are challenges that face those community and co-operative enterprises that want to take on an asset from the private sector. So, do you have a view on what the challenges are that prevent communities from taking ownership of assets from the private sector, and what steps should be taken to facilitate the process of a community taking on an asset from the private sector?

11:15

Diolch, Mabon. I think that's one of the most important questions when it comes to this topic of community empowerment. It's private sector assets that I'm really concerned about. I talked a bit about some of the concerns with the CAT process, but there are also examples of it working well. I think it's spreading that best practice across.

But, in terms of private sector assets, I think there's almost no process at all. You can get a bit of funding for it, but, in terms of process, I don't know what exists; I just don't think anything does exist. If you have an example of a village that only has one pub, and that's where people come to meet and the owner doesn't want to sell it to the community, what happens then? We've lost rural schools as well, and what right does a community have to take on that asset if the owner wants to sell it to someone else?

You can look at the Guildford Crescent issue in Cardiff too, so you've got beloved community assets—and you've got to remember that not all communities are geographic—being knocked down, despite 1,000 people marching against it and 20,000 signing a petition. In Scotland, potentially, they could have been registered as a community asset and the community could have registered a right to buy. In England, they could have registered as a community asset and they could have exercised a six-month moratorium on sale to anyone but the community. In Wales, they were knocked down and there was nothing anyone could do about it. So, that's what we mean when we said in our report that Welsh communities are the least empowered in Britain on this topic.

I really think that's an important area of focus for the committee. There's something to be said for funding and support and advice to allow communities to make a success of assets they take on, but it's not enough, because support and advice couldn't have done anything to save places like Guildford Crescent; the power just isn't there. When we were doing our research, stakeholders and community groups really came back with one clear voice, which was that the time for fiddling around the edges on this is over and it really needs real, concrete action. So, yes, in terms of private sector assets, we really need to get a system in place that allows community groups to have a chance when they're competing against the market. I gave that example earlier, but, essentially, community groups end up in a situation where something comes up for sale, they're really concerned about losing it, but there's no established legal identity, there's no funding and it just goes to the market. They lose out every time; they can't compete. So, I think the Welsh Government and the Senedd really need to do something to empower communities to compete on a level playing field for these assets.

Diolch, Mabon. Gwnaf i ateb yn Saesneg; dwi'n gwneud lot mwy o synnwyr y ffordd honno.

Thank you, Mabon. I'll answer in English; I'll make a lot more sense in that way.

I'll answer in English, because I make a lot more sense in English. So, just some of the barriers, I think, in terms of accessing those private assets—again, like Harry mentioned, the competition from the private market is just incredibly difficult, the cost as well. In England, a lot of the time, even when they've got that six-month moratorium, it's the seller that gets to decide the value, and it's not valued by an independent valuer, so, obviously, that can then push the cost up, can't it, and make it very difficult for the community to take on the asset. The time it takes, obviously, for communities to get together and be well governed and cohesive as a group, as a functioning group, is often a barrier. Again, access to basic information about these assets is a big barrier.

We've also had examples of where an asset will be up for sale, or a piece of land will be up for sale, and a community group will want to come together to save the asset or do something with it, they'll do a lot of community engagement work and make a plan for how they'd like to use it and start to sort of set the wheels in motion, really, and then, because of all of that community engagement work that that community group has done, it's actually pushed the value of the asset up and then they've just been absolutely gazumped by a private buyer, essentially. So, again, that's another key barrier and challenge for accessing private assets. I completely agree with what Harry said in terms of all of the legislation available in Scotland and England to be able to take on these assets in terms of the right to bid, the right to buy. And even in terms of Scotland, with the right to buy derelict and abandoned land and properties, that gives communities the right to take on these assets even if they're not up for sale, which can obviously then help to regenerate communities; we all know the problems with empty buildings and empty plots of land. So, that right would help to improve local areas even further, I think. So, I think we need legislation and a real focus on private assets.

11:20

Os caf i holi un cwestiwn arall, os gwelwch yn dda, Gadeirydd; dwi'n gwybod bod amser yn brin. Rydych chi wedi cyffwrdd arno fo. Rydyn ni wedi sôn yn barod—rydych chi wedi sôn—am yr angen i roi cymorth ariannol; rydych chi'n sôn am ddeddfwriaeth er mwyn rhoi blaenoriaeth i gymunedau lleol. Ond, yn benodol yn yr ardaloedd mwy difreintiedig rydych chi wedi cyffwrdd arnyn nhw, a mwy gwledig, mae nifer o'r prosiectau yma'n gorfod bod yn fusnesau cynaliadwy. Rydyn ni'n clywed sôn am brosiectau fel caffis cymunedol a thafarndai cymunedol, am bunkhouse cymunedol ac yn y blaen, ond mae angen cynllun busnes arnyn nhw, ac, yn amlach na pheidio, dydy'r sgiliau yna ddim o hyd yn bodoli mewn cymuned i lunio cynllun busnes i fynd ar y daith yna. Felly, ynghyd â phres, ydych chi'n meddwl bod angen edrych ar roi cymorth deallusol, cymorth gwybodaeth, i fynd â rhywun ar y siwrnai yna tan fod busnes yn sefydlog ac yn weithredol?

If I may ask one further question, Chair; I know that time is tight. You've touched on this issue already. We've talked—or you've talked—about the need to provide financial assistance and support; you've talked about legislation in order to give priority to local communities. But, specifically in more deprived areas and more rural areas, a number of these projects have to be sustainable businesses. We've talked about community cafes and community pubs, about a community bunkhouse and so on, but they need a business plan, and, more often than not, those skills don't always exist in a community to put together a business plan to go on that journey. So, alongside the funding, do you think that there's a need to look at providing support and assistance in terms of knowledge and information to take somebody on that journey until a business is established and is up and running? 

Diolch, Mabon. Yes, absolutely. There's definitely a need for a support system. I mentioned it earlier, but the three things that I think we need are community empowerment measures, support systems to make the asset sustainable and sustainably run, and funding. And I think, in terms of a support systems, you're right, it's hard to design a support system from scratch because you gave a couple of examples there, but the examples are pretty much limitless. I think there might be a place in the future for Business Wales giving business support. I think they offer a good model in terms of that tailored support and those overall skills that are important to all community groups, like business planning. But I think the advice you give to a community housing group is going to be very different to the advice that you give to a community pub. So, I think doing it in a holistic, tailored way is really important, but I think the support is absolutely necessary.

Yes, I completely agree. I think that the Scottish land fund not only provides funding for these kinds of initiatives, but it also comes with a sort of support package, a mentoring package, and, again, I think, the Plunkett Foundation, they have small grants available, and that, again, comes with an adviser for a certain amount of time that can support communities through this process. I think the support package needs to think about all of the options as well, and, putting my housing hat on as well, I think housing can obviously help with financial sustainability, because it's regular income. So, I think we need to think more holistically about how we use this land and assets and really plan for financial sustainability and a sustainable business plan.

Thank you, Chair. Thanks ever so much for coming today. Obviously, you've touched upon a lot of what I wanted to ask in terms of the legislation, so I think it's safe to say that you believe that the legislation that's in place in Scotland and in England definitely empowers communities there to take more of a role in the development of their community, purchasing land and buildings and that. I was just wondering, if you were going to give a wish list or a best-case scenario of what sort of policies you think the Welsh Government should be looking at to bring in here, is it like a carbon copy of what they're doing in England and Scotland, or are there are policies that they're doing in England or Scotland that actually are quite detrimental maybe?

But then also the other question I wanted to ask is, and it's something that's come up quite a bit, and I don't know if you might have experience with this, is sort of like the planning process. You know, a lot of these community buildings that people want to purchase have either historic value to them or significance, but they don't necessarily then have the listed building element to it. And we've seen a lot of instances where, as soon as a private owner knows that it isn't listed, they just go in and they just knock it down. And I was just wondering if your view then is that there should be anything that we as a committee should be recommending in terms of looking at the planning system in that, then, as well. Thank you.

11:25

In terms of what legislation looks like, I think you've got to have tailored legislation for Wales, because I think, in general, I would say the situation in England is better than the situation in Wales, in terms of community empowerment. The situation in Scotland is better still. Communities and stakeholders working in this area consistently told us that they thought a Scottish-style right to buy was a good idea. The Scottish Government is pleased with the results they've received. I think about 562,000 acres of land in Scotland are now in community ownership, and about 600 assets across Scotland, and this number has consistently increased. They've passed more legislation to strengthen it, and the current Scottish Government is looking to double funding towards community ownership.

The English legislation is an improvement on Wales with regard to private assets, but it does have flaws. So, sellers can just wait out that six-month moratorium period. And like Casey said, you could have a situation where that six-month period ends and then a private seller just pops up out of nowhere and you're straight back to the market situation. But at least they've had the opportunity to establish that legal identity and get a bit of funding to compete.

In terms of what Welsh legislation should look like, I think the Scottish legislation came from the historical land reform movement in Scotland, and that's why it's called the Scottish land fund, and it was spread out to other assets. I think Wales has less of a history with big, absent, feudal landlords, so it's going to come from a different place and it's going to look different. So, I think you've got to design it for Welsh needs. But I think that community right to buy is a really good idea. I think it really solves the issues we're seeing about communities feeling disempowered in their communities and around their assets. So, I think there's more work to do, which we'd like to do. We'd like to do a bigger project on looking at what that legislation, those measures, should look like, but I think a community right to buy is a really good start. I think, more than anything, it's just to reiterate the message that we really do need legislation in this area.

Yes, I think Wales is in a really good position, being the third nation out of the UK to develop these sorts of policies and legislation, because we can learn from England and Scotland. And like Harry said, the legislation in England certainly isn't perfect, so I don't think it should be a carbon-copy situation of there. There are all sorts of issues in terms of that: market value, the timescales and what they define as a community asset—I think the asset has to have been used as a community facility within the last five years, so that knocks a lot of buildings out of the equation, essentially. So, I definitely don't think that it should be a carbon copy.

There was quite a high-profile example in England called Atmos Totnes, which was a community development company that come together. They were going to take on an old dairy factory and provide affordable housing and community facilities. They held a big public consultation and the local community agreed that they would like to take this forward by a huge majority, essentially. But, again, they were gazumped at the last minute by a private developer. The sale was actually £3 million less than they were actually going to sell to the community for in the first place. So, it just goes to show that the English legislation isn't strong enough, I don't think, and that we need to develop a bespoke approach for Wales.

I think, yes, we can learn a lot from Scotland, and especially the community right to buy and, like I said earlier, the right to buy derelict and vacant land, I think, can really help with pushing the regeneration agenda and helping to improve and tackle empty properties in our communities. And also they have a right to buy land to further sustainable development goals as well, so, again, that can help with the climate crisis that we're facing. Did you want to come in there?

With regard to that right to buy, then, forgive my ignorance of it—the English legislation or the Scottish legislation—but, as I asked with the first question about the planning situation, are there protections in place then on a building that a private-sector person owns, that they say, 'Well, we want to purchase it', or whatever, so that the owner doesn't just go in and just knock it down? As soon as that is triggered, that stage, do you think we should be looking at the planning aspect as well to see what could be done?

11:30

I think it's looking at the same issue from two slightly different angles, because I think if you introduce that right to buy, if you did have a building that wasn't listed, and public bodies weren't willing to list it and the community thought it should be saved, you kind of resolve the issue anyway by being able to give it to communities. So, it doesn't necessarily even need the planning system if you have that right to buy.

I think the only other thing I would say about legislation is that the key issue to consider in all of this is that that pub in the village that the community wants to buy, but the owner doesn't want to sell to the community—. The key question is, what is the answer to that? So, I think Scotland has an answer and England has half an answer, but, if we don't legislate, I just don't know what the solution to the problem is. For people who oppose legislation, that's an answer I've never been able to get, so I think that's key for me.

I suppose the only thing that I worry about, for example, with that pub, if the owner doesn't want to sell it, he can say, 'Well, I can make it structurally unsound, and then it's going to take care of itself, then. A developer's going to come in and knock it down for housing'. 

So, it's a right to buy, because they do have compulsory purchase in certain circumstances in Scotland, but that's not what we've recommended. It's the right to buy when it's proposed for sale or transfer, so it's only if the owner wants to sell it to anyone, and it often happens they just want to sell it to a private seller and they don't want to wait for the community. So, it's not necessarily taking the asset out of the owner's hands without their consent; it's when they want to dispose of that asset, but it's making sure the community has a fair chance to get it in their hands.

I was just going to say, like Harry said, further work needs to be done on this, and I think a commission set-up would really help with that, to consider things like planning, because I think we can't look at this in just a single view in terms of community assets. We need to think about the planning system, we need to think about how we value land and assets, we need to think about social value and the tax system and how we use and manage land and assets in the long term. So, I certainly don't have all the answers today, so I think further work needs to be done to take a more holistic approach to this.

Okay, well, thank you very much, Casey, and thank you, Harry, for giving evidence to the committee today. You will be sent a transcript to check for factual accuracy. Diolch yn fawr. 

Okay, committee will break briefly until 11:40.

Gohiriwyd y cyfarfod rhwng 11:32 a 11:42.

The meeting adjourned between 11:32 and 11:42.

11:40
6. Ymchwiliad i asedau cymunedol: sesiwn dystiolaeth 2
6. Inquiry into community assets: evidence session 2

Welcome, everybody, back to the committee meeting today, and our sixth item on the agenda today, and the second evidence session of our inquiry into community assets. I'm very pleased to welcome our witnesses. Joining us remotely, Jon Rae, director of resources for the Welsh Local Government Association; Geoff Bacon, head of property services at Swansea Council; John Rose, director for Wales of the National Lottery Community Fund; Eleri Williams, policy officer for the Building Communities Trust; Ben Lloyd, head of policy for the Wales Council for Voluntary Action; and, here with us in person, Lyn Cadwallader, chief executive of One Voice Wales. Welcome to you all. Thanks for giving evidence to committee today. Perhaps I should just say at the outset that, obviously, we've got six witnesses in this session, so please don't feel that you all have to contribute on any particular question. If you've got something to add, we'd very much welcome that, but, obviously, we won't have time to repeat what's already been said. So, let me just begin perhaps with some general questions, and firstly, really, what you see as the main benefits, the opportunities, the social value that come with community-owned or managed assets. What can they bring to communities? Who would like to start us off? John.

I'm happy to kick off. There are potentially multiple benefits—critically, the availability of local space, be that green space or community facilities that provide activities, services, increased quality of life for communities, provide multi-use facilities. In many circumstance, those facilities that support multiple services reduce the stigma associated with some of those services as well, with people going in because they cover those multiple services. But, more generally, I think it also adds a sense of pride of place, a sense of achievement to successful organisations that are running those facilities—so, a real sense of building support. And there's also what I describe as a slight chicken-and-egg situation where, certainly, some of our experience has been that community asset transfers tends to happen more easily in more affluent communities, and perhaps where there's more social capital. But, equally, where you do have these facilities, they actually build that social capital, so it's really worth investing in communities where, perhaps, they need a little more support, because it builds confidence and it builds capacity as well.

11:45

Okay, thank you, John. Jonathan, did I see you indicating or were you adjusting something or other?

Sorry, was that to me, Chair?

Jonathan, did you want to contribute at this stage? I wasn't sure if you'd raised your hand or not.

No, Chair. Sorry, I was trying to adjust my sound because I've actually got your voice running two or three minutes in delay—

—so I'm not sure what's happening there. I'm finding it difficult to hear what's going on.

Okay, we'll see if our technical people can assist, Jonathan. Okay. Would anybody else like to come in at this point? Ben, yes.

Diolch. I think probably what we've found is a strong link between sustainable and viable communities and sustainable and viable community assets, and that those two things reinforce each other. So, a sustainable community asset is more likely to be sustainable when the community behind it is stronger, but also we found that community assets reinforced that.

We often talk about community assets in terms of the organisation that owns and runs them, but, obviously, they also provide space for smaller organisations to undertake a lot of their activities, so there's a knock-on impact on smaller organisations that would never be large enough or sustainable enough or financially well-off enough to run their own asset, but also—[Inaudible.] I suppose a typical example would be a sports and arts group that doesn't need its own sports club—it wants to meet, for example, weekly in a community centre to play badminton or something similar, so those organisations benefit significantly from this.

And then, secondly, obviously there's a distinction between community groups and communities themselves. Looking at the more informal community spaces, I suppose hubs are often what people think of first time around when they think of this, but there are other examples that provide spaces for the community to meet spontaneously and for that sort of community integration and community mixing as well.

Okay. Thank you very much, Ben. Anyone else? Yes, Geoff.

Thank you, Chair. I'm speaking, really, on behalf of two groups here: one is obviously Swansea Council and the other is—I'm chair of ACES—the Association of Chief Estates Surveyors in Wales, so, I'm coming at it from the wider Welsh perspective as well, but lots of our experiences are very, very common.

One thing I would say, certainly form a Swansea perspective, is that a big benefit is the fact that there's a continuation of service that perhaps we wouldn't be able to provide because our core policy effectively says that there has to be—and perhaps this is a very mercenary way of approaching it—a financial benefit to the wider council. So, if there wasn't a community group taking on the provision of service as opposed to just purely the asset, then that service may actually cease. So, that is a significant benefit. But we will get into the meat and drink in terms of some of the issues we have with the actual community asset transfer process in due course. But if it's done right, you undoubtedly have a sense of ownership of a service at a community level, and you generate true partnership working, but it can depend on how you actually effect the community asset transfer. So, I'll come on to that later on when we come into ways to improve and some of the issues we're finding with the process as it exists at the moment. But it's purely, I think, the fact that a continuation of service is critical for us and it's been effective in that regard in some key areas.

I'm sure we're all familiar with many positives and benefits that come from community-owned and managed assets, but I just want to draw your attention to some research that's focused on England that's been published. We're undertaking a Welsh equivalent. It demonstrates that areas that experience greater deprivation but have a higher concentration of community assets and community actions have better health and well-being outcomes, higher rates of employment and lower levels of child poverty, compared with deprived areas that don't have high levels of community assets or community action. And, as I said, this correlates with the early findings of some ongoing research we're undertaking in partnership with Oxford Consultants for Social Inclusion. Their findings suggest that otherwise deprived areas identified using the Welsh index of multiple deprivation that have community and civic assets will be less susceptible to being identified as at risk. So, in other words, typically deprived communities possessing stronger community and civic assets are more resilient than those without. I thought it was worth mentioning the fact that there is some hard evidence to back this up as well. 

11:50

Thank you, Chair. Following on, probably, from Geoff in some respects, obviously the retention of assets for public good is one of the key benefits of community-owned assets. Some other areas that I'd bring the committee's attention to are about, perhaps, the safeguarding of land for future use by communities. We're doing a lot of work with communities in trust around this agenda. Other areas would be, for example—. I'll pick up on issues around second homes in Wales; there are opportunities here. If a community right to buy exists within the Welsh context, instead of perhaps churches being sold for property development, they could be sold to the community for housing use, particularly in areas where affordable housing is not particularly widely available. Obviously, the other benefit is around actually saving sporting facilities, cultural facilities. And we've seen, certainly within the community and town council sector over the last 10 years, libraries, playing fields et cetera being taken on. And if they weren't taken on, they'd be potentially lost to developers. 

Okay, Lyn. Thank you very much. We will move on, then, to the issue of a register of community assets and what you think the benefits of that would be, and if it's your view that existing data sources, whether it's Land Registry, local government or Welsh Government, are insufficient, why you believe that to be the case. Do we need a register? Who would like to start us off? Lyn.  

Thank you, Chair. I would strongly advocate the need for a register of community assets across Wales. We've seen in Scotland, through their Community Empowerment (Scotland) Act 2015, the common good register, and I think that's something that would serve Wales well, moving forwards. In terms of the rationale for this—. I didn't say this when I started speaking, but I sit here as chief executive of One Voice Wales, representing the community and town council sector, but I've also sat on the national assets working group, formerly, and currently the Ystadau Cymru assets group as the community asset transfer lead. The availability of data for community and town councils, for example, is pretty patchy. That certainly could be improved, and that's equally applicable to the third sector in terms of the availability of information. We are currently doing work with HM Land Registry, because there's a requirement by 2026 for all asset data to be held by the land registry. And, again, there's a real paucity of data that exists out there at the present time. So, if this was available and was transparent, and was accessible, it would enable communities—both community and town councils and community-based organisations, third sector bodies—to collaborate, potentially, around saving assets that are increasingly coming under threat because of the financial pressures that unitary authorities are under. So, I certainly would welcome it.  

Okay. Thank you, Lyn. Would anyone else like to add anything? Yes; John. 

To help me answer this question, I actually had a go at doing this on Google this morning, and found it virtually impossible to find any data. So, from a community perspective, that's quite a good test. So, I think that does back the idea of having it.

There are a couple of bits to add. I would just say it's really important not to forget other public bodies, other than local authorities and Welsh Government—so, police authorities, fire, health. We'll come on to this later, because they have other challenges associated with demonstrating social value. The other piece is not just to restrict this to assets that are available, but by a more general process of mapping assets, it helps organisations think about what I'd loosely call a competitor analysis—seeing what else is in your area and who you might need to work with so that we can try to avoid unnecessary duplication and competition, which is going to be increasingly important as organisations struggle to sustain themselves. 

11:55

I'm going to come in with a slightly contrary view, which I think is probably healthy for the debate, and it's one that's shared with a lot, if not all, of my local authority colleagues. They have a concern over an asset register because it obviously adds constraints. We'll get into the detail again about the process and how it does work or if it doesn't work. But, we've all got experiences of dealing with dozens of community asset transfers. I think in Swansea we've dealt with at least 35; we've got about a dozen more in the process with legal colleagues. We also have a particular type of community asset transfer when it comes to our community centres, because we have agreements with the voluntary committees. We've got 40 or so of those, and they're all, basically, managed by the voluntary committees under agreement from the council by way of a licence, but they have considerable support and that's the most important factor. It's a successful model, I would suggest, in terms of how this could work going forward.

There are constraints with the register. It probably makes it slightly more of a proactive process than a reactive process. As I said before, quite often, when we have an asset or a service that's no longer going to be provided, that creates an opportunity for local groups to get involved, but we do have a financial perspective to this. Swansea's guidance and also Welsh Government guidance recognises the fact there is a financial element; that we all have to realise the fact that if we can generate a capital receipt, that goes into the wider capital programme just in terms of our general delivery of services. So, if there's a potential constraint on any organisation where they're not able to realise a capital receipt, it causes a problem, and it's something where there's a real issue there. 

How it would be managed and who would manage it is obviously an issue. The fact is that we are all generally struggling in terms of lack of resource, in terms of staff—we've all lost staff. This would obviously be—potentially, if we're not careful—another responsibility on local authorities to manage that we would wrestle with. It's very much a concern from ACES, in particular, that if this was imposed on Welsh authorities, I think they would struggle with it. I suppose it comes down to what's broken and what needs to be fixed, and is this part of the solution. 

Okay, Geoff. Thank you very much. Anyone else on this? Yes, Ben. 

Diolch. We would be broadly supportive of an asset register in some form, but we would want it to be coupled with an idea of what should, and also, I suppose, by definition, what wouldn't be included on that. Therefore, from our point of view, it's predominantly those buildings that are used as a community space. I guess there would be definition issues about what would and wouldn't be included. So, just, I suppose, to flag the concept of what is a community asset, how we account for what is in that community and what we may or may not choose to do in terms of community ownership of them after, and whether it's a single unit, I guess.  

[Inaudible.] No. Okay. We will move on, then, to other committee members. Firstly, Jayne Bryant. 

Chair, I think Jonathan—. Is it Jonathan? I think he wanted to say something. 

Thank you, Chair. Sorry, I just wanted to come in on that, because we've seen before registers of things that have been introduced, and they just end up being lists of things. We don't want anything that's overly bureaucratic and cumbersome. We really have to think about the purpose of these things. I appreciate especially what my professional colleague Geoff has said about some of this, but if we do need these things, it needs to be really purposeful, and we need to think about why it's there. It's about community empowerment at the end of the day. If it's contributing towards that, that's absolutely fine, but I don't think we need another register of assets. There is another example that we've seen in Ystadau Cymru, or what was formerly the national assets group, which was the ePIMS database. I'm not convinced that had been developed with a strategic purpose in mind, and it just became a list of properties, really. So, that's the point I was going to make, and thanks for bringing me in, Chair.

12:00

Thank you, Chair. Good morning, everybody. I'm just thinking about the amount of support and advice that's available to those community groups that are looking to take on a community asset. Do you think there's enough advice available within your organisations and perhaps in others for such groups taking on an asset to start out with?

This is a common concern from all local authorities—the fact that we don't have sufficient resources to manage this process properly. Rhondda Cynon Taf have a team of five, and I think they're a very good example of where it actually works, because they have a significant number of staff who can assist community groups through the process.

We keep on referring to asset transfer. This is more than that, this is how they actually manage themselves and how they actually manage the provision of the service for a community benefit. I referred to the way it works for our community buildings, where we have 40 under this yellow licence, as it's described. We have a team of three community development officers who support all those voluntary committees, who have a sense of ownership of their buildings and the community space. But, they need a lot of support, whether it comes down to their premises management responsibility or understanding, if they're going to have a car boot sale or table top sale, things they have to do to make sure they are in compliance with public protection colleagues. So, it's not properly resourced.

We're lucky to have those three community development officers in Swansea who look after 40 particular organisations. That goes to show the scale of need. But, this is against the backdrop of the fact we've all been cutting and cutting and cutting, so we're losing staff. So, when it comes to a lack of provision of service going forward, you would expect there to be a significant revenue benefit or revenue saving as a result. So, we lose those who could support the groups, and that's a common complaint from every single one of my local authority colleagues, with the exception of RCT. They'd probably still want more, but they're always the beacon of how to do it properly, because they've properly resourced it, which would mean, no doubt, there's a detriment somewhere else because something else isn't happening.

But, you need support in terms of how you run a business, not so much about how you run a property. We always concentrate on the leasehold aspect of it, which is why I'm here, but I'm not necessarily the right person to speak to on community asset transfer, because it's how you support those individual service provisions.

Okay, Geoff. Thanks very much. We've got Ben, I think, and then John.

I think advice and support on both taking ownership of an asset by a community group and then support on, in some instances, I guess, quite technical information on running the asset as a building and as an institution with a business model of some sort, whether that's a commercial business model or one that's still reliant on some form of grant funding, is one of the things that's been raised most with us from within the sector.

I think it's particularly exacerbated by the fact that a lot of that support has to be developed in relatively short timescales, when people are also at the same time often volunteers and at the same time trying to raise the funding sufficiently to take ownership of a building where funding is an issue. Also, I suppose, there's a really intense period of activity where I suspect some of the more technical support is more difficult to get a hold of in that timescale, and I think that's probably, as a contemporary point as well, exacerbated by the fact that the costs of running any building, particularly community assets, at the moment are going up and are likely to go up again in October as fuel prices rise as well.

My instinct would be to say there probably isn't enough support out there. I think one of the things that hasn't happened recently—we certainly haven't done anything on this recently—is to map exactly what's out there. Just building on some of what others have said, absolutely, the type of support changes between that early stage support, which is often around project management, construction expertise, quantity surveying, and quite easy to buy in professionally as well, but there are key issues around governance as well—. So, for organisations that are looking to take on an asset, the governance they require during what I call the rescue phase is quite different to what they need when they're running something as a going concern, which builds on Geoff's point, I think, in terms of doing that. And, of course, there are existing sources of support out there—Business Wales, for example. One of the important things is actually understanding what is out there but filling those gaps in. And, certainly, when we've supported—we ran two asset transfer programmes some time ago, and we ran support contracts alongside of that to support people who were going through this. But there are some existing sources of support out there as well, so it's important to understand what's there and try and tap into that as well. 

12:05

Thank you, Chair. I just wanted to differentiate between national support and the support locally within the third sector for the organisations that are taking transfers on, because I think they're two separate things. I think, over a long period, the national assets group, which is now Ystadau Cymru, has provided good national support, which started, I think, with a transfer protocol way back in 2010, and that kind of thing has been very, very useful.

I know the WLGA has actually worked with One Voice Wales on a, I think it was—. And Lyn might want to chip in on this, but there was an independent review of community and town councils, and we had a group that looked at how recommendations could be progressed within that. But I think there's been good national stuff, and the real worry is the kind of issue that John raised there about the local support and somehow the technical and start-up stuff being very, very different—things kind of go wrong—and getting the governance right; these are the things that I think are a real worry.  

As part of our prep for this response, we did a brief survey of our network, and 71 per cent of people who responded to our survey were able to access support in relation to their asset transfer. So, there is support available. It's far from universal; it varies across Wales. But another key feature was that the support tended to come from other third sector organisations or infrastructure bodies or their county voluntary council. It didn't tend to come from a local authority or a public body, unsurprisingly, given the constraints that Geoff has highlighted. 

We also noted that some specialist agencies only operate according to a limited geographical footprint, which is far from universal across Wales, and that most of the support was cost free, unless it was specialist legal advice. Groups also highlighted the fact that it's all well and good to have access to support when you're going through something as significant as an asset transfer, but there is a baseline of ongoing support that groups need, and that is also variable. They agreed that there was a need for additional cost-free support, but weren't in agreement as to where that was best placed, be that in other third sector organisations, local authorities. Unsurprisingly, there was quite a lot of division there.

We've previously called for the community facilities programme to be enhanced to also look at building community capacity, not simply looking at the bricks and mortar and the fabric of community facilities. So, that might be something that could be looked at to help build some of those softer skills that are needed within community groups to facilitate their ongoing running, particularly around developing in terms of asset transfers as well. Thanks. 

I think there's information that's been generated over the last 10 years, which is available to the community and town council sector, to third sector bodies, but it is merely information. Certainly—and again, this is not my evidence; this is Welsh Government's own research in 2018, 2021, Audit Wales's research—more can be done by unitary authorities to support community and town councils and the third sector. I hear what Geoff says; at a previous Ystadau Cymru advisory board, when Mark Drakeford was the local government Minister, I actually lobbied on behalf of the unitary authority sector that they needed more resources to actually enable community asset transfer to be done appropriately.

Likewise, and I think, as I said, it's well documented, we've got the community and town councils sector managing approximately £200 million-worth of assets. Yes, it's not the same as the unitary authority asset portfolio, but there is actually no dedicated resource available to the sector at this present time. I've made the same argument for the last 10, 12 years that if we want to do community asset transfer properly, then we need adequate resources to sit and help those organisations use the information that's been provided. So, Welsh Government did an excellent job a few years ago of producing a website around community asset transfer; it's currently hosted on the One Voice Wales website. Has it been updated in the last three years? No, it hasn't, because there's no resource to actually continue to update and manage it effectively for the sector.

So, we would be certainly arguing that—. I hear Geoff's point around only five resources, and only and only, and, yes, it is tough for the unitary authorities—I don't disagree with that—but, as recipient bodies, both community and town councils and third sector bodies, there is not a dedicated resource currently available to them. And yes, I hear John's point around, yes, you can buy in resources, but, if you're not a specialist in the assets field, even commissioning asset-related resources to help you is a difficulty, and I think that needs to be recognised.

12:10

Thank you, Chair. And I am conscious of time. I was just going to say that I think it is important, in terms of the advice and how that changes from the start to as communities go on with any transfer. Just thinking about—and I think John might have touched on this earlier—the differences between community ownership management in terms of context, such as differences between rural and urban areas and affluent and deprived communities, and how the challenge for that is, really, because, obviously, there are so many assets in deprived communities, do you think that there are challenges within that, in terms of getting communities to take them on?

Okay. Thank you, Jayne. Who would like to begin? Yes, Geoff.

Probably, this won't come as a surprise to anyone, but you undoubtedly see the bigger and the brighter and the brasher schemes coming from the more affluent areas, who seem to have an ability to tap into architects and lawyers, and, to be frank, they're better at filling in the forms. And once you get good at filling in forms, you tend to have, you know, that snowball effect—you tend to be better at getting more and more grant money. So, yes, that's undoubtedly the case. In the same way, you'll always see village green applications coming in from the more affluent areas, because, again, they are seemingly more aware of what they can and cannot do. So, that's undoubtedly something we're seeing. But it doesn't mean to say you're not getting them in some of the less affluent areas, but they're definitely on a smaller scale, and you're always dependent upon one or two very strong and passionate volunteers. And that seems to be another one of the issues you might have sometimes—you're reliant on Joe Bloggs to come in and do it. And once Joe Bloggs gets fed up and doesn't want to do it any more, then these things can, unfortunately, die. But, yes, that's very much a trend—the bigger schemes are certainly in more affluent areas.

I'd agree; we've certainly seen that—more affluent areas do tend to be more successful. Some of the solutions to this are about time and patience, in terms of supporting, and a greater level of support, potentially, to support organisations to go through that. And also that's where the support of the transferor is so important as well, and not just, I suppose, the resources they've got but the mindset that sits within that as well. So, I think it's an issue we see, but I think it's probably resolvable if the will is there.

Thank you, Chair. I think where these issues have been in the public eye most recently have been in the centre of Cardiff, or Cardiff more generally, and in rural west Wales, in both cases where land and housing property prices are increasing at substantially higher rates than the average wage in those areas. Obviously, there are different assets that are being affected there, and being sold for different reasons: holiday homes versus, I guess, more regular accommodation in Cardiff. I think, in those two particular examples, there's the same driver, of the value from development increasing and it being very difficult to demonstrate the value of retaining something within the community to the same degree. So, to some extent, what we're keen to see is a community asset policy that would, to some extent, rebalance that capacity for the community interest to be taken into account to the same degree, or certainly to rebalance it slightly away from financial concerns.

And I suppose the second point we just wanted to raise is some emerging discussion from some of our networks and partners that communities in areas of multiple deprivation tend to be at a significant disadvantage in taking over assets. We feel like there are also similar challenges faced by communities of interest as well, that they may want to develop something within that community on the basis of a characteristic, so there is a secondary element there as well. But our discussions and our evidence are emerging on that aspect, rather than being quite as fully formed as we have on some of the other issues.

12:15

Okay. Thank you, Ben. Thank you, Jayne. We'll move on, then, to Sam Rowlands. Sam.

Yes, thanks, Chair, and good morning—good afternoon, everybody. And thank you for your time—much appreciated. One of the challenges we've heard from groups so far is around funding and securing funding for those groups to either—well, initially related to purchase, to get hold of assets. So, I'm just wondering what you think Wales can learn from other models, such as in Scotland, where they have this Scottish land fund. Do you have any thoughts on how Wales could adopt some of the principles that are in place there at all?

Thanks, Chair. Yes, thanks, Sam. I might defer to John Rose, actually, in a minute, because what was mentioned to me this morning, actually, because I spoke to one of my colleagues who deals with the community buildings and those community centres I talk about, is that they do have a lot of success in terms of National Lottery funding. Even though the agreements they have—hopefully I'm not giving away any secrets here—aren't 25-year leases, they're basically annual licences. And quite often, we hear from groups that they have to have long-term lease agreements in order to access funding. But that doesn't appear to be the case with the National Lottery, which has been incredibly helpful, and they have been very successful—sums of a couple of hundred thousand pounds have been achieved to improve some of these assets, but that's not always what they're looking for.

If ability to access funding wasn't determined on what can be quite a prescriptive and daunting long-term lease agreement, I think that would be a big help. We could deal with everything a lot quicker; we could deal with it under the general disposal consent; they would lease it under seven years without having to go through cabinet; we wouldn't have to worry about best value implications if we did it that way. But we tend to tie ourselves up in knots a bit by having to go through a cabinet process in line with our policy, which is right and proper, because that's in our constitution, but it makes things a lot more complex. So, an ability to access funding that's necessary without having the constraints of having a long-term lease agreement would be a big help, and the National Lottery successes that I've heard about are testament to that; it can be done.

Okay. Thank you, Geoff. Did you want to comment, John?

Yes, I'll comment. We have relatively recently reduced our asset liability periods, but it does depend on the size of the grant as well. So, some of the large asset transfers—. So, we've done some very large grants as well, where we have required either freeholds or long-term leases as well. But I'd agree with that point. I think the point here is about flexibility, and often, for organisations and people, sometimes they might want to take on a seven-year lease rather than take on a longer term one, because it's actually quite daunting to take on that on a longer term basis. 

If I may also pick up on the Scottish land fund, I'm no expert on this, but it is a fund that's distributed by the National Lottery Community Fund in partnership with the Scottish Government, so, if there was an opportunity, I'm sure a colleague of mine would come and talk about that as well. I think one thing that is quite critical with the Scottish land fund is to understand that it's been around for over 20 years, so it's had time to develop and mature. And many of the points that are coming out of it—the lessons learnt, and I've got a few of them in front of me here—are known to us, if you like, as well. So, just looking at some of the key points that have been passed back to me, there are—. The points about strong, community engagement are the same for the Scottish land fund. The fund may be there and the legislation may be there, but there's something about mindset and normalising this as a way of doing business, if you like. So, strong community engagement comes through, and, again, the need for technical support. The key lessons from the Scottish land fund are coming through to the work that we're doing elsewhere. Technical support is there, governance support, business support—all those things are coming through as well, looking at building and developing organisational structures. Timescales are key, and I noticed that, quite often, in the Scottish land fund, they'll actually insist on having a development officer there for three to five years as part of this as well. So, the point there is ensuring that there is adequate support and finance to give an organisation a fighting chance of getting going, once the asset transfer has happened, and also helping to navigate legislation. That's a key element that's come through there. As I say, I'd be happy to arrange for a colleague from Scotland to talk in far more detail than I am able to.

12:20

Okay. Well, we may well follow up on that with you. Eleri.

Undoubtedly, financial barriers are one of the biggest barriers that community groups face in terms of trying to acquire assets, but assuming they can acquire an asset, it's also the ongoing costs that act as a huge barrier. Often, asset transfer or long-term leases are on a full-repair basis, so they have to cover maintenance costs, and often, in the length of time it's taken to actually complete the transfer, the building or the facility has become more antiquated and more dilapidated, so those costs increase.

I think it was Ben who also mentioned, obviously, rising living costs having a huge impact on everyone. I've heard very recently from community groups who have got upwards of 20 per cent increases on their budget lines. They don't know how they can sustain their opening hours. They're having to reduce their opening hours when they're facing higher needs and requests than ever before. We've been told that buildings have had problems with their heating system and it has cost £1,000 to keep going. Raising money for the refurbishment is challenging. There are lots of avenues to acquire funding, but you do have to, typically, combine multiple funding sources, and the timescales to get that don't tend to line up. So, it's all these barriers that cumulatively create a really difficult circumstance for groups to do this.

Okay. Thanks, Eleri. Lyn, did you want to come in as well?

If I may, yes. I'll follow on from a few of the colleagues' comments. The one thing around funding that I think is absolutely critical is time. What I mean by time is the period from when a transferor allows a period of due diligence for the potential transferee to consider taking on the asset. In terms of learning from Scotland, if moneys are available, say, for the third sector, to enable them to commission in the necessary services to go through an appropriate due diligence process, that would be helpful. I'll go back to time and I'll give an example. There was one unitary authority, not so many years ago—I think it's improved since—that sent the letter out in December asking community and town councils in their unitary authority area which assets they will take on, and to let the unitary authority know by 30 January. That wasn't helpful. To go through an asset transfer process, again, academic research suggests somewhere between 12 months to 18 months minimum, and I think the lead-in time needs to be appropriate, so that the necessary parties can get together.

There are examples in some of the research. It would be better for organisations like community and town councils and third sector organisations to come together to collaborate to take on an asset, but the partnership activity there will take time. And the other bit around funding is that from a community and town council perspective, before a community and town council really takes on an asset, they should have an electoral mandate, so they need to go through a participative exercise with their local residents to make sure that the local residents want to retain the asset that may be under threat. Those are a few areas, I think that—. Oh, and the other area, I hasten to add, and I do recognise Geoff's comments earlier that the unitary authorities have got small teams, is that having accurate financial information around the running of an asset or outstanding repairs et cetera is absolutely critical, because if you don't have that information, the potential transferee body is not going to necessarily be applying for the right level of funding to sustainably manage that resource on an ongoing basis.

12:25

Thank you, Chair. I appreciate those comments. I think there are two elements to the funding; one around grants, and another perhaps around borrowing as well. For many of these organisations, borrowing from high-street banks or other traditional avenues can be quite a challenge at times, and it strikes me that local authorities in particular here in Wales sit on over £2 billion worth of reserves. Some local authorities have upwards of £200 million individually, and I guess the return on those reserves at the moment are pretty poor, especially where inflation is going—very poor indeed. I wonder if there's a role—I don't know whether it is for Jonathan to perhaps respond—for local authorities to make better use of those reserves in terms of lending to community groups who may sometimes struggle with the traditional routes. Is there a role there for local authorities to play in using their reserves in a better way, and if not, how can that be justified, when there are good community groups looking to utilise assets better around the community, whilst local authorities are sitting on over £2 billion of reserves?

Thank you, Sam, for that question. It's a very good question, actually. With local authorities, I think the latest data we have—Sam Rowlands is absolutely right—is that reserves are around about £2 billion. About £1.8 billion of those reserves are actually earmarked for things; they're probably earmarked for capital projects and things like that already, and some of them will be school reserves. But actually, I think it's an interesting question, because there are about—if I remember rightly—£200 million in general reserves, and some authorities already have used their reserves for invest-to-save funds. We've already talked about RCT. It's been a long time since I've asked these questions, but I know three or four years ago, they were running an invest-to-save fund that was financed through their reserve. Obviously, they're not necessarily investments in community assets, but certainly, at the time, these things were loan-type arrangements. Savings would be made and were paid back into the fund. I understand that recently, there's more use been made of local authority finance for funds for individuals and organisations, so I think it's certainly something that can be explored. Money does have to be used, but I'm not sure that the whole £2 billion is just sat there looking for a purpose, because as I've said, some of it is school reserves, some of it is for capital or PFI-type projects anyway. So, yes, it's a good question.

I did just want to go back to the Scottish land fund as well. It's a great model, and as John pointed out, it's got a longer pedigree; I think John said about 20-odd years. But it is slightly different—it's been linked over a long period in Scotland, hasn't it, to land reform and the legislation that the Scottish Government have been bringing in. So, I think that's a different aspect that has to be borne in mind. But it's certainly an interesting model.

I need to be slightly careful as to how much detail I go into here, but having come from another meeting this morning, I suspect that if you ask the question about general reserves in about 18 months' time, it'll be a much lower figure. We're all going to suffer as a result of increasing materials cost, increasing utilities costs. I don't know quite what the future pay award is going to be, but if the retail price index is going to hit 9 per cent come autumn, I suspect we're going to have some future difficulties. I think Swansea is quite healthy when it comes to reserves, but there isn't a lot there.

We talked previously about the fact that you get to the point where an asset or a service is going to cease to be provided, and quite often that can be due to the fact there's been a lack of maintenance on that asset over the last few years. We still have a significant backlog of maintenance that we're going to have to deal with over the next few years. And, of course, we've got a net-zero challenge as well, which is going to need considerable investment. So, there are lots of competing asks. So, a bit of caution in terms of an expectation that there's lots of money sloshing about. I'm not entirely sure that there is. If Welsh Gov have got it, happier still. That might be a recommendation from this group—that you might find some more money for us.

12:30

I know time's going, but I just want to clarify the point in terms of reserves, because, of course, the risks around using reserves for recurring spend we'll all be aware of, but the idea here is about lending that, so that money would come back in, and probably at an interest rate, which actually benefits the local authority as well, supporting those communities who can't get hold of that capital in the first place. So, it's probably a bit of a win-win opportunity there, both for local authorities and for those community groups. But it's probably something that needs exploring in a bit more detail whenever we're able to. Thanks.

We could be looking at local government-type mortgages as well, possibly, going forward, for building of housing. That's just another thought. Regarding community asset transfer, do you ever look at the social value as well as the financial value? Geoff mentioned that you will do an asset transfer if there's a financial value for the capital receipts, but is the social value considered as well?

Yes, absolutely. The policy basically stands on the assumption that, if you have an asset that has a significant market value, or a market value, that asset will be marketed. It doesn't mean to say that we can't effect a community asset transfer, because it is available to the wider market. If a community group wishes to take on that asset, it enables cabinet and, therefore, council to make a decision as to whether they are going to forgo a capital receipt for that associated social value. We will always need a service to be advocates for anyone who wants to take on asset and, if I'm honest with you, that's where we sometimes have a problem. Someone may come forward with a proposition, but finding someone within the organisation that says, 'Yes, we would agree with that' as being the right way forward—it's quite often where we have a bit of a stumbling block. It's a subjective perspective, I guess, isn't it, in terms of what a social value would amount to, but that can be fine from a cabinet perspective. We're not suggesting that the social value equates to £100,000, it's whether there's that wider benefit. So, it's still very much possible. But, again, I would say, in line with Welsh Government guidance, we would tend to assume that we would generate a capital receipt if we can, but quite often the margins are quite low on some of the assets we bring forward. So, if they're a previous service-related asset, that tends to be quite relatively straightforward if we're going to deal with it directly with a group. If it has more value—

Sorry, Geoff. So, if Welsh Government changed the guidance so it wasn't all based on financial value and capital receipts, and there was a social value element to it, that would help you, would it?

It would help, but it probably wouldn't change our position, because the position is still as it stands in the constitution in terms of our land transaction procedure rules. But we would still need to generate capital receipts to balance the books when it comes to the future capital programme. I don't think value is something that's a blocker for us at the moment, because there is still that ability for cabinet to make that call as to whether they want to forgo that capital receipt. Is that okay?

Just a really quick observation. I'm not sure if this is still the case, because I've not been as close to asset transfer in recent years, but certainly when we were doing work on this, we found it was much easier for local government to do this, because of the legislation that Geoff's just described. It was much, much harder for other public bodies to do it. So, that might be something to look at as well, in terms of the ability of health boards, police et cetera to transfer public assets they have.

Yes, just to reinforce the point John's making. As part of my role as chair of ACES, we have other public sector bodies represented, and they don't think community asset transfer applies to them. It's not something they feel is an issue for them. So, if there was something that could support that. They, obviously, clearly, have much, much smaller asset portfolios, and are much more specific when it comes to health boards and police et cetera. They are involved with the community, but not to the extent where they think a community asset transfer would apply to them.

Thank you, Chair. Not everything's about the money. I mean, it's important at the end of the day, but there are toolkits out there that can be used in association—well, to assess social value. In England, obviously there's the Public Services (Social Value) Act 2012, but we've got our own Well-being of Future Generations (Wales) Act 2015 here, and one of the toolkits that was developed in England, the TOMs toolkit—themes, outcomes and measures—has been adapted here and mapped onto the seven well-being goals. Now, that's been used in the area of procurement at the minute, and I think our procurement colleagues use it quite successfully, and I think that that kind of toolkit can be adapted in this case as well. Because they've got—. I think now there's a proven track record that they have in measuring social value through, I guess, what's now a consistent and established method.

12:35

I was going to ask—. Sorry, I should've mentioned before about the well-being of future generations Act being applied as well as social value, so thanks for bringing that in, Jon.

I think Ben wanted to come in as well, Carolyn. Ben.

Thank you. I suppose one of the things that we want to flag—it is often the case when we're discussing public bodies, when they're multiple within Wales—is that the experience of some people in the voluntary sector can be quite variable, depending on the local authority, and I think there's probably—well, there is a general consensus that social value is—[Inaudible.]—to drum up opportunity to do some of that rebalancing I talked about earlier in terms of procurement and disposal and other financial activities. But that isn't necessarily well understood or universally understood or particularly well implemented sometimes, and I think probably more so when it comes to disposal of land than buildings in some cases. And I suppose one of the things we also have some concerns about is whether the benefits that community ownership or voluntary sector ownership of an asset—how much of that can be quantified in a social value setting. So, you can count the number of volunteer hours, for example, but it's really difficult to quantify having a space where people can meet up, and the additional well-being benefits that brings to a community. It's really difficult to quantify some of the additional social, environmental benefits the community-owned piece of land would bring that it wouldn't otherwise. Social housing is an important step towards doing that and the future generations Act provides a setting where we can have a unique Welsh take on that as well, which we would want to have taken into account, but I think we definitely want to make sure it's more universally available to people.

Sorry. Just regarding—. So, Geoff said that you've got three community development officers and then there are expertise in different areas as well, and regional disparities have been mentioned regarding advice. So, do some local authorities, then, maybe give seed funding to voluntary councils to help with that advice as well, or do you think it's got to be done through direct employment?

I think, ultimately, it would just depend on the different local authorities' approaches, I guess. I mean, the way that Swansea—which obviously I can talk about with a little bit of knowledge—the three officers we have specifically support our community centres that were an amalgamation of what were community centres, youth centres and old-age pensioner pavilions, as was. They're not necessarily directly involved in the community asset transfer process. So, that community asset transfer, in terms of how it's managed by way of licence, is something that's very specific to the way Swansea operates, and I would suggest it's a very successful model, because they're all sustainable, they all carry a level of reserves themselves. So, they're all financially sustainable, so there's no risk in terms of those organisations continuing.

We have one community development officer, who is now supporting a community asset transfer process, and that's resulted in a recent appointment, and that's proved to be helpful, but it's nowhere near the level you would expect. I'm aware of Rhondda Cynon Taf having five officers dealing specifically with community asset transfers, and that's about the level that I think you'd need if you are going to run it properly. As you can see, there's no real consistency, but everyone's suggesting that they've lost the expertise, and quite often, the process is managed through the property teams, and I don't think that's right. We manage the end result in terms of the legalities of the lease arrangements, but I don't think that's actually right in terms of what you need. You need sustainable organisations who can continue to function, who can continue to support the wider community, because let's not forget that not everyone's community function is supported by everyone in the community. Someone may not like it. We've dealt with some, when we've dealt with football clubs, for example, where not everyone likes that that football club has taken on as a community asset transfer of a playing field, because someone else wanted to use it for something else. So, there's a lot of work to be done in terms of assisting the community groups to take it up to the point of taking on a facility and running a service.

12:40

Diolch yn fawr iawn, Gadeirydd. Dwi am holi'n Gymraeg, felly gaf i wirio bod pawb efo'r offer cyfieithu'n gweithio? Os medrwch chi gadarnhau—dyna ni, ardderchog, diolch. Dŷn ni wedi sôn hyd yma, yn naturiol, oherwydd y bobl sydd yn bresennol, yn benodol am asedau cyhoeddus, ond mae yna enghreifftiau o asedau o'r sector breifat sydd yn eistedd yn wag, os ystyriwch chi dafarndai, garejys, sinemâu ac yn y blaen. Beth ydy'r hurdles, beth ydy'r hyn sydd yn y ffordd ac yn atal grwpiau cymunedol rhag cymryd ymlaen rhai o'r asedau o'r sector breifat? Beth fedrwn ni ei wneud er mwyn ei wneud o'n haws i fentrau cymunedol gymryd ymlaen asedau o'r sector breifat, os gwelwch yn dda?

Thank you very much, Chair. I will ask my question in Welsh. Can I just check that the interpretation is working? Can you just confirm that that's the case? Excellent, thank you very much. We've so far focused, naturally, because of the people we have in front of us, on public assets, but there are examples of private sector assets that are vacant, if you consider pubs, cinemas, garages and so on. So, what are the hurdles or barriers that prevent community groups from taking on some of these private sector assets, and what could be done in order to make it easier for community groups to take forward private sector assets?

Diolch. I think, fundamentally, the difference is that disposal of private sector assets is much more stringently regulated—take, as an example, a pub that, Mabon, you mentioned, that can be sold relatively quickly from one private landlord to another without, in some cases, the community even needing to know. So, there's something about how we recognise those facilities that have an additional community value, how we make sure that's accounted for in the process of disposal, I guess, which, obviously, is a really complex thing. I think the broadest challenges are that the timescales are shorter, which makes raising funding much more difficult, it makes having access to that advice that we discussed earlier much more difficult. Also, ultimately, at the end of the process, I suppose, when it's a wholly privately owned asset, there's nothing really restricting the owner from disposing of it in the way that they see fit, I suppose.

Okay. Anyone else like to add anything? No. Mabon—sorry, John.

Just building a little bit on what Ben said, it can be much simpler if they can purchase at a commercial level, or, indeed, if the seller is happy to sell it below market rates. So, it can be both simpler and more tricky. I'd agree with Ben about how the timescales are typically difficult because people need to go to raise the finance to do that in time to meet a private sale.

Felly, mae'r ddau ohonoch chi hyd yma wedi sôn am yr amser mae'n ei gymryd i fudiad cymunedol ddod ynghyd a llunio cynllun busnes, casglu'r pres ac yn y blaen. Dŷch chi'n meddwl dylid bod yna ryw fath o ddeddfwriaeth mewn lle neu reoliadau mewn lle er mwyn rhoi cyfle i fudiadau cymunedol fedru gwneud hynny er mwyn achub adeilad yn y sector breifat? Meddwl ydw i am—er enghraifft, mae rhai capeli weithiau yn dod i fyny ac mae'r gymuned yn teimlo'n agos iawn at y capel, neu'r sinema, yn teimlo ei fod o'n perthyn iddyn nhw a dŷn nhw ddim eisiau ei weld o'n mynd i fod, fel dŷch chi wedi sôn, yn dŷ gwyliau neu rywbeth fel yna.

Therefore, both of you have mentioned the time it takes for a community group to come together, draw up a business plan and gather funding and so on, but do you think there should be some sort of legislation in place, or regulations perhaps, in order to provide opportunities for community groups to do that to save a private sector asset? For example, I'm thinking of some chapels, where the community feel great connection with the chapel, or cinema, even, and they feel a sense of ownership and they don't want to see it becoming holiday accommodation or something similar.

I'm not sure in that case whether legislation—I don't know if legislation is the right approach on this or not. Talking to colleagues in Scotland about Scottish land reform, they say that, yes, the legislation is useful, but, actually, there's almost more of a culture of community ownership that's built up in Scotland over time, so it's an accepted way of working. Actually, the primary driver of whether an asset is transferred is the availability of finance to allow that to happen, as opposed to the legislation allowing it to happen. I think legislation is one thing, there's almost—if it's a Welsh way of doing things, that would be really helpful, almost, to build a culture around this.

I think we'd be really interested to see some kind of regulatory or legislative proposals around how assets that are at risk of being lost from the community—how the community could, I suppose, have the chance to be involved in that process. Obviously, I suppose that also reinforces what John said, that that would need to be in the toolbox of tools, I suppose, and that we'd also need some of the funding and the advice and support. I think part of the discussion we've had with our members is that particularly many community groups feel strongly when assets have been lost in the last 20 years, often as a result of austerity and local government finances, and outwith the control of local government, often, and changing consumer habits around pubs and theatres and so on. But parts of the voluntary sector feel very strongly about that, but alongside a series of other tools as well. I think there's probably a case for a more coherent community asset policy, of which that is potentially one element.

12:45

Thank you. I think, again, we do have to develop our own Welsh way on this because of just the different ways that community empowerment has evolved in Scotland, which, as I referenced earlier, was, I think, through land reform, and obviously they've got the Community Empowerment (Scotland) Act 2015. In England the Localism Act 2011 has moved to introduce new community right-to-buy provisions, but, again, I think the way it's developed in England's more been based on the acute austerity that especially local authorities have experienced there, and it's led to more asset transfer. So, I think, yes, perhaps more powers, but we've just got to develop our own Welsh way on that, I think.

I'd just echo what Ben was saying. I think the community right to bid, as we know about in England, can offer that window, that six-month moratorium where community groups can try to raise funding, but often that time frame isn't long enough. So, yes, I think if there was legislation it would need to be part of a wider toolkit and one element of a much more co-ordinated and coherent approach. So, yes, we'd support it, but it would need to be just one part of a much broader picture and jigsaw.

I would just echo Eleri's point, really, Chair. I think if community and town councils were to work in collaboration with a community-based organisation, if there was some sort of moratorium period, that would be helpful in just recognising that community and town councils have an annual precept, just like Government has an annual tax-raising approach. So, some sort of moratorium, just so that the community has the opportunity to consider, I think, would be helpful.

Okay, Lyn. Anybody else have any points to make about the Scottish or English legislation and how well it works, and whether we really ought to seriously consider those approaches here in Wales, or are you happy with what you've already put on the record? Yes, okay. That's fine. Thank you very much. Thank you all for giving evidence to the committee today. You will be sent a transcript to check for factual accuracy, and apologies for us running over our allotted time. Thank you all very much. Diolch yn fawr.

Gohiriwyd y cyfarfod rhwng 12:49 ac 13:34.

The meeting adjourned between 12:49 and 13:34.

13:30
7. Ymchwiliad i asedau cymunedol: sesiwn dystiolaeth 3
7. Inquiry into community assets: evidence session 3

Welcome back to committee and item 7, our third evidence session of the day on our inquiry into community assets. Joining us remotely as our witnesses are: Tom Chance, chief executive of the Community Land Trust Network; Chris Cowcher, head of policy and communications at the Plunkett Foundation; Tom Stainer, chief executive of CAMRA, the Campaign for Real Ale; Natalie Sargent, development manager for Wales at the Coalfields Regeneration Trust; and Richard Harries, associate director of the Institute for Community Studies. Welcome to you all.

Perhaps I might begin, then, with some general questions. The first one is what you see as the main benefits, opportunities and social value that community-owned or managed assets can bring to our communities here in Wales. Who would like to start us off? Who did I see first? I think Richard. 

13:35