A legacy of centrally imposed restrictions meant that original grant funding was clawed back if one of these local assets were sold or their original purpose changed – even if the government scheme had long since ended.
Ministers are worried that this forces community owned assets to stay stagnant and potentially unused when the land or building could be serving the community. Community and voluntary groups need to be given the freedom and flexibility to use their assets in a way that best meets the area’s changing needs.
The removal of ‘clawback rights’ busts a barrier imposed on local communities by central government. Communities will now be free to use their assets as security to obtain loans to sustain or expand their activities. If an asset is too expensive or no longer fit for purpose they will be able to sell it and move to more appropriate premises that better meets the needs of local people.
Greg Clark said:
"Community and voluntary groups who know their area best need a real say on how their local services, buildings and businesses are run. I’m determined to bust every centrally imposed barrier that holds communities back from acting in the best interests of local people.
"Today we’re ending rigid central restrictions that stopped communities from maximising the potential of their public land and buildings by clawing back central funding. Ending clawback rights will put communities back in charge of community assets and gives them the freedom and flexibility to prioritise their current needs over dated central diktats."
Councils, voluntary groups and social enterprises have also been invited to let Ministers know of other historic grant programmes where clawback rights have been applied in perpetuity preventing communities from making best use of their assets so that the government can consider whether the terms should be changed too.
Steve Wyler, Director of the Development Trusts Association, said:
"This is a fantastic start! For years DTA members have been campaigning for a level playing field. Clawback has meant that enterprising organisations, like our members, have been developing community assets with one hand tied behind their back, the removal of these restrictions will really support them to grow and benefit even more local people. DCLG is giving a great lead on this, let’s hope the rest of Government follows suit."
This is another significant step for communities to take control of their neighbourhoods as the Government pushes power away from the centre. Today’s decision follows the launch of consultations on new Community Rights to Challenge local services and Buy vital community assets in the Localism Bill.
The consultations will run for 12 weeks, taking views from people, councils and their employees, community groups, voluntary organisations, private businesses and other interested parties.
Mr Clark has also called on councils to publish their spending on the voluntary and community sector as part of increasing transparency and opening up services locally.
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