The JESSICA (Scotland) Trust is a timely £15m resource that will offer substantial support to community groups in some of the most economically challenged parts of Scotland to develop local assets and enterprises. In this feature, Nick Addington from the organisation setting up the Trust – the Scottish Community Foundation – explains the thinking behind its establishment.

When we talk about regeneration today, we increasingly talk about resilience. Indeed, it was the theme of SURF’s Annual Conference earlier this year. Regeneration isn’t simply about making immediate improvements to neighbourhoods, but about ensuring that communities can withstand the future challenges of a turbulent world. They are able to re-group, organise and take action for themselves in the face of difficulties, and are set up to learn from experience.

As important as it is to create housing, communications and business facilities that are attractive to employers and residents, physical investment has to be accompanied by steps to build the capacity of local people and strengthen local organisations. To genuinely address long-standing disadvantage and social problems in our communities, we must recognise that resilience is a function of the people and organisations within them.

The JESSICA (Scotland) Trust, currently being established by the Scottish Community Foundation with an endowment from the Big Lottery Fund, is expected to be operational from Spring 2012. The Trust offers an exciting and timely opportunity to test out doing regeneration differently.

Two JESSICAs, one goal

The Scottish Government and the European Investment Bank are establishing a £50m JESSICA fund. This will provide loan finance for physical developments in the 13 Scottish local authority areas that are currently eligible for European Regional Development Fund support.

Alongside this, the Big Lottery Fund is providing £15m to establish the new independent JESSICA (Scotland) Trust. This Trust will make available grants and loans to commission or deliver programmes of activity that catalyse or implement community-led regeneration.

Operating across the same 13 areas, the intent is for the Trust to complement and enhance the larger JESSICA infrastructure investments.

With up to ten years to apply its £15m endowment, the Trust will be an independent, innovative and flexible vehicle. It will be able to take a long-term approach by acting on emerging learning and adapting to a changing environment.

Supporting community assets and enterprises

In developing our thinking about how the Trust can best achieve its aims, we have sought input – particularly from SURF and the newly formed Scottish Community Alliance – to consider how to best link the Trust to Scotland’s current regeneration context. We are also keen to explore how it can most effectively complement other developments in community empowerment, especially in asset development and community enterprise.

A key conclusion from these discussions is that the harnessing and controlling of assets and services can contribute to community regeneration, but communities need support to facilitate this. Ownership of local assets gives communities a chance to ensure that local land or buildings are retained in productive use. It also enables communities to use those assets to provide locally-relevant services. Additionally, assets can generate income from rent or trading to be reinvested in the community.

Community-owned social enterprises also offer the opportunity to involve local people in delivering local services and maximise economic opportunities to retain wealth within communities by creating local employment and again, reinvesting profits in the community. Developing locally owned assets and enterprises empowers communities to play a greater role in their future – promoting resilience and sustainable regeneration. Locally controlled income streams reduce reliance on competing for external funding to support services or invest in new projects, but can lever-in additional investment.

The experience of managing assets and enterprises fosters increased skills and confidence amongst community-based organisations and promotes partnerships between them; it can lead to a more enterprising mindset, fostering a ‘hands-on, cando’ attitude to address further needs or opportunities. Crucially, it also enables communities to be more active and credible partners alongside public agencies and others by allowing them to bring resources and capabilities to the table when local structures such as Community Planning Partnerships are planning or allocating resources.

Overcoming barriers

We recognise that there are significant challenges to developing successful community-owned enterprises and achieving community ownership of assets in a way that is genuinely empowering. There is the potential danger of leaving local volunteers drained of energy or enthusiasm or saddled with liabilities and unrealistic borrowing commitments.

In many communities, however, ‘anchor organisations’ such as development trusts or community-controlled housing associations are interested in pursuing such opportunities. In fact, there is a growing track record of such community-led bodies successfully doing so. Meanwhile, organisations such as the Development Trusts Association Scotland, Community Energy Scotland and Community Recycling Network Scotland offer support and advice, drawing on the growing body of experience and expertise existing in community organisations around the country and further afield.

Building on best practice

Our hope is that the JESSICA (Scotland) Trust can use its resources alongside the range of other development support, funding and investment opportunities available in Scotland to foster the further development of community-led initiatives that can connect to and enhance the impact of the physical projects that are enabled by the Scottish Government’s JESSICA fund.

By offering affordable loan finance where there is current market failure, complementing this with grant aid and development support, the Trust can offer a supportive, engaged and flexible approach to finance. We hope this will build on and extend existing good practice in community-led regeneration, contribute to developing learning, policy and practice and make some in-roads to breaking the cycle of poverty and disadvantage in some of Scotland’s poorer urban communities.

SURF will be working with the Scottish Community Foundation to identify and disseminate lessons from the use of the JESSICA trust fund over coming years.