The Community Wealth Building (Scotland) Bill was introduced by the Scottish Government in March 2025. The Stage 1 debate is scheduled for 20 November. So, what is community wealth building, what’s in the Bill, and how have stakeholders reacted?
Background to the Bill
First, some housekeeping. A more detailed look at the Bill is available in the Bill’s SPICe briefing.
The Economy and Fair Work Committee was appointed lead committee for this Bill and held evidence sessions before the summer recess. The Committee’s Stage 1 report and published responses to the Call for Views are now available.
What is community wealth building?
Community Wealth Building (CWB) is an approach to economic development. Its aim is to stimulate and retain economic activity within a local economy.
The idea behind CWB is for it to be co-ordinated and delivered by ‘anchor’ institutions. These are public, private or third sector bodies that have a large enough presence in a local economy to change economic outcomes. In theory, these could include local authorities, the NHS, large private sector employers, universities, and government enterprise agencies.
There are five ‘pillars’ to CWB.
Pillar 1: Spending
This pillar is primarily concerned with how and where anchor institutions direct their procurement spend. The Bill’s Policy Memorandum describes it as:
Maximising community, worker and business benefits through procurement and commissioning, developing impact enterprises, Fair Work, and shorter supply chains. Higher levels of spend with SMEs, micro-businesses and inclusive business models resulting in business growth and improved, resilient local and regional economies.
Source: Community Wealth Building (Scotland) Bill Policy Memorandum
Pillar 2: Workforce
This pillar seems similar to the Scottish Government’s fair work agenda. Payment of the real living wage by anchor institutions is often cited as an example of this pillar in action.
Increasing Fair Work and developing local labour markets that support the prosperity and wellbeing of communities. Access to local and fair employment opportunities, fairer wages, skills development opportunities and improved wellbeing of employees.
Source: Community Wealth Building (Scotland) Bill Policy Memorandum
Pillar 3: Land and Property
Growing social, ecological, financial, and economic value that local communities gain from land and property assets. Land and property are used for the common good and benefit communities, SMEs and micro-businesses and the environment.
Source: Community Wealth Building (Scotland) Bill Policy Memorandum
An example of this pillar could be anchor institutions transferring unused land or buildings to community-owned organisations. The community asset transfer process gives community bodies in Scotland the right to request land or buildings from local authorities, Scottish Ministers and some public bodies.
Pillar 4: Inclusive Ownership
This pillar is essentially about increasing the number of social enterprises and co-operatives.
Developing more local and inclusive enterprises which generate community wealth, including social enterprises, employee-owned firms, and cooperatives. More inclusive and democratically owned enterprises and assets which means the wealth created locally and by local people stays in those communities in the form of incomes and profits.
Source: Community Wealth Building (Scotland) Bill Policy Memorandum
Pillar 5: Finance
Ensuring that flows of investment and financial institutions work for local people, communities, and businesses. Money and investment are retained in a local area and are available to support communities and businesses.
Source: Community Wealth Building (Scotland) Bill Policy Memorandum
Credit unions and community share issues could be practical examples of this pillar.
Research by the Improvement Service suggests that local authorities view the finance pillar as “the most challenging to progress. Questions remain around the role of local authorities, particularly concerning pensions.”
What’s in the Bill?
Many public bodies are already progressing CWB in some form. However, this is not always underpinned by formal plans and the extent to which CWB has been implemented varies across Scotland.
The Bill aims to ensure national coverage of CWB as an approach to economic development. It does this by placing duties on Scottish Ministers and various public bodies.
These duties relate to the publication and implementation of statements, action plans and guidance.
However, the Bill as introduced would not change the law in any policy areas directly related to the five pillars of CWB, such as public procurement, community asset transfers or employment law.
There are three parts to the Bill. The remainder of this blog summarises the content of each part and stakeholder reaction.
Part 1 – Community wealth building statement
This part of the Bill would place a duty on Scottish Ministers to publish a CWB statement. This must set out the measures that the Scottish Ministers will take to facilitate CWB. It must be revised at least every five years.
Specifically, the statement must set out what measures the Scottish Ministers will take to:
(a) reduce economic and wealth inequality between individuals and communities in and across Scotland, and
(b) support economic growth in and across Scotland,
by facilitating and supporting the generation, circulation and retention of wealth in local and regional economies.
Source: Community Wealth Building (Scotland) Bill, as introduced
Stakeholder reaction
Whilst some stakeholders have noted that legislation is not required for a CWB statement to be published, others view it as a means of ensuring a long-term commitment to CWB from ministers.
Part 2 – Community wealth building action plans
This part of the Bill would require local authorities and ‘relevant public bodies’ to publish and, so far as reasonably practicable, implement a CWB action plan, to be revised at least every five years.
The Bill includes examples of what may be included in action plans but doesn’t mandate anything about their content.
The Scottish Ministers would have the power to amend the list of relevant public bodies by regulation. The proposed relevant public bodies are:
- Regional colleges
- NHS health boards
- Scottish Enterprise
- South of Scotland Enterprise
- Highlands and Islands Enterprise
- Skills Development Scotland
- Regional transport partnerships.
A local authority and relevant public bodies in its area would form ‘CWB partnerships’ and can act jointly with other local authority areas.
It should be noted that local authorities are named on the face of the Bill (rather than listed in the schedule of relevant public bodies) because they already undertake economic development activities. The Bill’s Policy Memorandum specifically highlights local authorities’ convening role.
Stakeholder reaction
In this Bill there is a trade-off between providing local authorities and relevant public bodies with flexibility, whilst ensuring that the statutory duties are meaningful enough to change outcomes and ensure nationwide implementation of CWB (which is the policy objective of the Bill).
A common theme of discussion in reaction to the Bill is whether the duties in Part 2 go far enough. Some welcomed the Bill’s flexibility; others argued that it should be more directive about the content of CWB action plans.
Currently, if a local authority wanted to pursue CWB, other public bodies in its area would not be required to take action. This Bill would change that. It is seen by some stakeholders as a way of getting organisations ‘round the table’.
Another common theme in discussion has been the role of third sector and community organisations, such as development trusts and community benefit societies. Some stakeholders want the Bill to provide a role for them in setting the content of CWB action plans and holding delivery partners to account.
Other themes include whether the list of relevant public bodies is appropriate, whether delivery partners have the resources to deliver CWB action plans, governance and accountability mechanisms, and how the impact of CWB action plans will be measured.
Part 3 – Community wealth building guidance
Part 3 of the Bill would place a duty on the Scottish Ministers to produce guidance in relation to both the production of action plans and the implementation of CWB principles generally. The Bill does not specify what should be in the guidance.
‘Specified public bodies’ must have ‘due regard’ to CWB guidance when developing their corporate plans and associated delivery strategies.
As in Part 2, Scottish Ministers would have the power to amend the list of specified public bodies by regulation. The proposed list of specified public bodies is:
- Creative Scotland
- Crown Estate Scotland
- Highlands and Islands Airports Ltd
- Historic Environment Scotland
- Integration Joint Boards
- National Park Authority
- NatureScot
- Scottish Police Service
- Scottish Canals
- Scottish Courts and Tribunals Service
- Scottish Environment Protection Agency
- Scottish Fire and Rescue Service
- Scottish Forestry
- Scottish Funding Council
- Scottish Futures Trust Ltd
- Scottish Land Commission
- Scottish National Investment Bank
- Special Health Boards
- Sportscotland
- Scottish Water
- VisitScotland.
Stakeholder reaction
There appears to be near consensus that the content of the guidance will play a key role in determining what substantively changes as a result of this Bill. For this reason, some stakeholders argued that the Bill should be more directive over its content.
Others have called for clarity over what the phrase ‘due regard’ means in practice, how it will be determined whether specified public bodies have given due regard to the guidance, and how this will be monitored.
Next steps
Parliament will vote on the general principles of the Bill following the Stage 1 debate, which is scheduled for 20 November 2025. The Parliament’s website includes information about how Government Bills like this one progress through Parliament.
Rob Watts, Senior Researcher, Financial Scrutiny Unit, SPICe