Written Statement - Assets of Community Value measures contained in the Localism Act 2011

This Written Statement updates Members on progress in relation to the protection of community assets. 

I have considered whether the Assets of Community Value (ACV) Measures which are contained in Chapter 3, Part 5 of the Localism Act 2011 should be enacted in Wales. The ACV Measures came into force in England in 2012.   During the Bill’s passage through Parliament, the then Minister for Local Government and Communities, agreed a consultation exercise would be carried out prior to any implementation of the Measures in Wales.

In summary, the ACV Measures oblige Local Authorities to establish, maintain and publicise lists of assets of community value within the Local Authority area. Land or buildings considered to further the social or economic wellbeing or the social interests of the community can be nominated for inclusion in the lists by community groups with a local connection. The Local Authority makes the final decision on inclusion in a register. Assets included in the lists can be in Public, Private or Third Sector ownership. Residential properties are exempt from inclusion on the lists.

Should an asset on the list be offered for sale, a moratorium period initially of six weeks can be triggered to allow the community to register its interest in developing a bid to purchase the asset. This moratorium is extended to six months once a formal interest is registered.  The asset is then sold on the open market which means there is no guarantee the community group would become the new owner. There is no right of first refusal.

There is no automatic requirement for any services or activities previously carried out within the asset which is “listed” to be carried out in the same way once the sale of the asset is completed.  Should the new owner wish to change the nature of the use of the asset following their successful purchase they are free to do so (subject to necessary and required planning permissions).

A number of Members have raised this issue with my predecessor on behalf of constituents.  A considerable amount of correspondence, mainly in relation to pubs and sporting facilities was received and a number of meetings held including one with Professor Andrew Davies in his capacity as Chair of the Commission on Welsh Co-operatives and Mutuals Commission.   The Commission’s report, which was published in February, makes a number of recommendations relating to community assets.

My predecessor made a commitment to make an announcement about these issues and I want to honour his promise.    I also want to ensure any arrangements we make here take full account of the Welsh context and, where appropriate, learn from the experience gained in England over the past two years.  We have a considerable amount of information about how the ACV measures have been implemented and the number of concerns raised.

In general, there are three main groups of stakeholders with an interest in this issue:  community organisations, asset owners and Local Authorities.  Their interests do not always coincide and, in practice, the ACV measures represent a compromise which may not fully satisfy any of them.    It is important, therefore, we have a clear understanding of the aspirations and concerns of each of these groups before we make any arrangements in Wales.   At the same time, I also want to ensure each of these groups has a clear understanding of what implementation of the measures in Wales would mean for them. 

• Community groups need to be aware the Assets of Community Value measures do not enable them to force the sale of an asset to the community, or prevent its sale to a higher bidder once the 6 month moratorium period is over.  In addition, it is important the distinction between a physical facility, and the services provided from it is clearly understood.  The former may be covered by the Measures while the latter is not.
• Asset owners may consider the Measures infringe their rights and portray private owners negatively or express concerns listing will lower the value of an asset or make it difficult to sell.
• Local Authorities would have a number of roles in relation to the ACV Measures.  As well as being responsible for maintaining lists of community assets, they are likely to be the owners of some of the assets in question.  They will also have established relationships with many community organisations, including providing funding and advice but also in regulatory roles.

More generally, we should not underestimate the resource requirements arising from implementation of the ACV Measures, including the need for adequate provision for monitoring and evaluation. I am also mindful of the legislative time pressures on the Welsh Government currently. I am particularly concerned we should not generate unrealistic expectations public funding will be provided to enable community organisations to purchase assets.  Given our present financial circumstances, such funding would need to come primarily from outside the Public Sector.

Linked to this, I consider any action in relation to community assets is most likely to be effective if it is linked as strongly as possible to our existing community programmes and policies.    I would highlight, in particular, our consistent focus on tackling poverty, including our support for the most deprived areas of Wales through programmes such as Communities First.    We particularly want to protect community facilities in these areas and our limited resources are likely to remain focused mainly in these areas.  We do recognise the importance of community assets in other areas as well, but where they are supported by public funding we expect they too will support the poorest people and those facing particular difficulties.

In view of all these considerations, I do not intend to implement the ACV Measures in Wales at present.  I consider there is scope for us to develop an approach which is better suited to the Welsh context and addresses some of the shortcomings in the present arrangements in England.   I have, therefore, instructed my officials to contact those who have recently expressed an interest in this issue to set out my thinking in more detail and encourage continuing dialogue.  In practice, I do not think it will be possible to implement a new approach before the next National Assembly elections, however, I hope we will be in a much clearer position on the best way forward.

In conclusion, the Welsh Government greatly values the contribution key community facilities, and more particularly the people who support and use them, make to the economic, social and environmental wellbeing of Wales.  I am determined we should find the best way to protect and enhance such facilities, taking full account of the views of all those with a legitimate interest in these issues.   I ask all Members to support the process I have outlined as we take this forward.