Municipal socialism is winning – what a shame the Labour leadership isn’t shouting about these success stories

Peel away the rubble of Labour’s Hartlepool by-election defeat and crushing local election losses. Tune out the leadership’s kneejerk, factional-driven meltdown. Beyond the dismay and disunity, a series of Labour success stories are emerging as beacons of hope and possibility.

First, the mayoral victories, 11 of the 13 posts contested. In the Welsh Senedd, Labour first minister Mark Drakeford piled 10,000 votes onto his own majority with the party holding power against expectations. And across the country, Labour councils have bucked the downward national trend: holding seats, even increasing vote shares. Each win has its own story. But one clear pattern is that Labour gained when it pitched left and championed people-driven, community wealth-building policies.

This style of politics has many labels: guerrilla localism, municipal socialism or economic democracy. Matthew Brown, Preston’s Labour city council leader who helmed this pioneering grassroots model in the region (and held all 10 council seats last week), calls it “extreme common sense”. Paul Dennett, Labour city mayor of Salford where the party gained seats last week, describes such a policy path as “sensible socialism”.

Whatever you call it, the approach has meant that, in the face of severe government-imposed austerity cuts piled upon decades of regional neglect, local politicians can pull on power levers they do still control – like procurement budgets or property assets – to redirect wealth back into local communities, secure jobs and services and build financial resilience. And it works.

In Preston, the council engaged the hospital, university and colleges, and the city council itself, to shift procurement funding to local suppliers, which has redirected £700m back into the local economy since 2013. Contracts cover anything from lunches to legal services and construction projects. Add to that the flourishing worker co-operatives and push for real living wages and Preston was by 2017 the most improved city in a Demos survey, and in 2020 had its highest employment rate in 15 years.

In Salford, left-led Labour has gone strong on social and council housing as a foil to rip-off rents and unattainable private ownership. Welsh Labour is pushing a radical policy platform anchored in real living wages for care workers and thousands of jobs in low-carbon housebuilding. Across Preston, Liverpool and the Wirral, plans for a joint regional community bank have popular support. And metro-mayor Andy Burnham, having promised to re-regulate Manchester’s decimated bus service, is now posting about plans for a region-wide living wage and an NHS-style social care service.

Those engaged in community wealth-building projects will tell you it’s a long, slow process. But as one Labour organiser in Salford told me: “We’ve taken the time to explain ourselves with intellectual honesty and vigour. It is hard work, but it pays off – because people can tell when it’s real.”  

This style of politics runs in contrast to what several Labour organisers across the country described as the phoney, robotic, patronising flag-waving vibes coming off the current Labour leadership. Where Labour is making local electoral gains, local leaders focus on building an inclusive sense of community anchored in shared values, tackling shared hardships and reviving places in a way that makes people feel proud to live in them.

This style of left politics is currently picking up steam. The Democracy Collaborative think tank, which developed the community wealth-building concept, is fielding calls from Labour councillors and party members nationwide. Preston’s Mathew Brown has just co-authored Paint Your Town Red with writer and historian Rhian E Jones, explaining how the Preston model works and providing a toolkit for towns that want to reproduce its successes.

With its genesis in Cleveland, Ohio, the model is gaining international traction: proposals pop up in Australia, Canada, New Zealand and the US – where New York City deputy mayor, J Phillip Thompson, speaks of community wealth building as essential to tackling the economic anxieties that fuelled the rise of Donald Trump. The model is finding salience in a pandemic that awakened an appetite for collectivism and community purpose, while the Covid relief efforts of local authorities fostered human relationships where there had previously been a faceless town hall.

All of which makes it perplexing that the Labour leadership is so silent on the subject. There is scant curiosity in the mechanisms of community wealth building or its successes. The message coming from Labour’s helm is that the party wants to listen and learn, but it displays little interest in hearing this language.

As Preston’s Matthew Brown notes in Paint Your Town Red: “Imagine if every Labour city were setting up its own banks, supporting worker-owned businesses and credit unions? Imagine it. That would be our way of taking back control.” What a shame the Labour leadership lacks the imagination to grasp the significance of this story, or make it a cornerstone of its politics.