Imagine popping down to our local Newsagents for a paper and paying for it with a “Fiveways Franc”?
That’s exactly the way things have been working in the town of Totnes, Devon since 2006 with the introduction of the “Totnes Pound”. Totnes was the first community to become a Transition Town ; a community committed to finding ways of reducing their future dependence on oil and minimising their carbon footprint. However recently and more close to home, Lewes issued 10,000 "Lewes Pounds" as part of its Transition Town "Energy Decent Action Plan" in September. These wonderful Lewes £1 notes have been a real hit, albeit in an unexpected way with most being snapped up in the first 3 days and currently going for about £35 on eBay! Plans are already underway to issue another 30,000 Lewes Pounds so they can continue to circulate around the Lewes economy.
So how does a "Local Currency" work?
Alternative currencies are valued and treated in exactly the same way as standard Pounds Sterling. The only difference is that it is legal tender only in the local shops and businesses that accept them. Think of it as a loyalty scheme that is tied to a geographical area (eg. Totnes/Lewes/Brighton/Fiveways) rather than a particular shop. In Victorian England, Mill owners sometimes used to pay their staff with tokens that could only be redeemed in local shops owned by the Mill owner. Whilst their motives were more unscrupulous than those of the Transition Movement, the result was the same – a thriving, resilient local economy.
To understand the benefit of a local currency; imagine you need to buy some food and instead of heading (in the car or bus) to the local supermarket to buy Brussel Sprouts from Argentina and Asparagus from Israel, all the while making a large corporation richer; you walk down to your local shops and by farm-assured Sussex bacon from Barfields and Kent Strawberries from Danny at the Green Grocers. Locally accepted currency pushes you to shop locally, reducing your need to drive to the shops and to fly produce thousands of miles to stock supermarket shelves. It also supports local businesses, enriching your local community and making Fiveways a nicer place to live. Because the people who own businesses in Fiveways are locals too, they spend the local
currency for their own needs and of course hand it out in change to other local shoppers, keeping the “shop local” phenomenon going. It can be used to purchase anything local - like paying for babysitting or purchasing vegetables from the local allotment or farmers market.
So I can just print my own money?
Not at all. The easiest way to implement an alternative currency is to have an Issuing Authority. This is normally a Community Trust, which is responsible for printing the currency and making it available for people to 'purchase' into circulation; where people exchange Pounds Sterling for local money. Often this can be done at a discount to foster the uptake of the new currency.
Here's an example: George goes to a shop issuing Fiveways Franc's (FF's) and hands across £9.50 for FF10. George can then use his 10FF's just like £10 in the local Fiveways shops that accept them. If George wanted to cash out his 10FF at any time, he would get back his £9.50, but clearly its better for George to spend his 10FF and keep the local currency circulating. The Community Trust holds George's £9.50 in trust, just the same way the Bank of England used to keep an amount of Gold equivalent to the amount of money in circulation. Once in circulation, the value of the local currency is the same for whoever’s hands it passes through, so there’s no chance of someone being left with worthless money.
Although not a new concept, the success of the Totnes experiment has been very encouraging, with Transition Towns all over the world issuing local currency. To learn more about Local Currency and the Transition Movement visit: http://thelewespound.org , http://transitiontowns.org/ or http://www.transitionbrightonandhove.org.uk/
[The article, by Rob Gourdie, first appeared in the Fiveways Directory July 2008]
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