By Aaron Barbour
A couple of weeks ago the Local Democracy, Economic Development and Construction Bill was given royal assent, so becoming law. It does two things: firstly it aims to create more opportunities for local people to get involved in decision making; and secondly it gives local authorities a greater role in economic development, including requiring them to assess economic conditions in their area, produce a regional strategy in conjunction with the Regional Development Agency, and cooperate with other councils.
The requirement to assess local economic conditions has been of particular interest to Community Links, because we have carried out research into the informal economy in several London boroughs over the last few years and have increasingly realised its importance to local economies. We estimate up to 20% of people have worked informally, and the sector as a whole could be worth as much as 12% of GDP, or £120bn a year. We decided it was such a crucial yet under recognised issue that we set up our Need not Greed campaign to raise awareness.
So does this new act make it obligatory for Local Authorities to understand and include their local informal economy in their assessments and strategies? Well sort of. The legislation allows for local Councils to determine what they want to assess. It’s only the guidelines that suggest they think about all aspects of their local economy, including the informal economy. This is a shame, so just to highlight how important we think it is here’s an example.
In 2006 Haringey Council’s economic regeneration unit knew there was a gap in their knowledge. They knew people in Haringey must work cash-in-hand, because they’d come across individual cases from time to time. But they had no idea who was doing it, why, or how many, or how it impacted on the department’s work, and therefore it was barely considered in their plans. They asked Community Links to do some research, knowing that we’d done very similar research before, in other boroughs.
We quickly built up links with the Selby Trust, a well-respected local community organisation in Tottenham, who coordinated all the interviews. In talking to 2,600 people in Haringey we found that informal paid work was a significant part of the local economy, mostly in areas like catering, cleaning or childcare. The council used our detailed report to build the informal economy into economic regeneration strategies and activities so they better reflected the reality of life for people in the borough.
To find out what’s really going on in your area see the Community Links website or contact Aaron Barbour on 020 7473 9666 (dd) and aaron.barbour@community-links.org
