My proposal is the creation of a new “Community Bond” to benefit a “Community Trust”, and then onwards to support local community-level projects. The bonds would be issued through the post office with a face value of £100 per bond. The buyer would have the right to sell back to the government at any point, and the government would have the right to buy the bond back (as a new angle on quantitative easing potentially, but also a simple source of revenue raising). Each bond would be undated and guaranteed by the government, just as with premium bonds.
Each bond would attract a coupon (interest) at the BOE base rate, but this money would not go to the holder. Instead it would go into one of many “Community Trusts”, which would have the sole remit to redistribute all of the money received through these coupons in the previous year to eligible projects. They would open applications for any local project in need of funding (parameters to be decided) on an annual basis. The sole job of the trustees would be administration and to present a shortlist of eligible and vetted projects.
Who actually gets the money would depend on participants (the bond-holders), following a vote, where they may split their votes across the ten or so shortlisted projects as they see fit. The number of votes caste by them in the annual distribution meeting will relate to their holding. One bond held for one month gives one vote (so someone who has held £50,000 for the year gets 60,000 votes). The size of the community should be determined so as to include areas of greater deprivation, so that this doesn’t just ensure that money stays by money, though ultimately it will depend on the votes not on the administrators. I would suggest using parliamentary constituencies as I think all include a variety of needs and so a variety of eligible projects.
Bond-holders would be encouraged to engage with these projects and online forums be established to debate who best deserves to be supported, possibly with an angle of direct participation of feasible. Bond holders should do not engage physically should still be feted though as active participants.
The government gets it’s money at a reasonable cost, especially as if the base rate rises so will the cost to the government of all other funding anyway. For the projects if the base rate does rise they will get a lot more money to distribute, but either way currently undervalued income will be through this system distributed with active participation into directly funding local cohesion through local endeavours.
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