Assets and the Community

Is Community Asset Transfer a solution to property contradictions? David Alcock explains the background to recent guidance developed with the Asset Transfer Unit.

There are significant conflicting pressures on local authority property managers. On the one hand, they need to save costs, reduce the size of the estate, trim budgets and improve balance sheets. But they are being asked to dispose of assets in a flat property market. On the other, they are asked to contribute to a nebulous outcome called “the Big Society”. But is there an approach which can deal with all of these issues?

Community Asset Transfer – the transfer of public sector assets to community organisations – offers a way of reconciling the consolidation of assets belonging to the public sector, with a genuinely “Big Society” approach that seeks to build the capacity of local groups. Whilst it builds on work of the previous government, it enjoys support among coalition ministers, with Andrew Stunell recently commending a local authority for its work in making community asset transfer work in Parliament. And, following the launch of the Localism Bill, community asset transfer clearly underpins the various ‘community rights’ provisions as proposed.

Community asset transfer involves establishing a clear case for the benefits of transferring public sector assets to third sector organisations, rather than selling them off, and then dealing with the process of transfer. The complications of delivering the approach in practice have been an issue for some authorities, but the Asset Transfer Unit – delivered by the Development Trusts Association in association with Community Matters and the Local Government Association and funded by Communities and Local Government to promote the approach – have been working with law firm Anthony Collins Solicitors on tools to make the process speedier and more (cost) effective.  The tools were recently launched on the ATU website and, whilst they are still out to consultation, can be used now.

There are some knotty issues which can affect transfer in similar ways to some of the other key “Big Society” proposals, such as the drive to provide public services through co-operatives or mutuals. The new guidance considers the issue of how to avoid illegal State aid, for example, and also the implications of the European rules on the procurement of services – which can be an issue, potentially, if (for example) the local authority wants to tie the transfer of a community centre to services being provided there.

The process of transfer goes through a number of stages, which are set out in detail in the “legal process map” which gives an overview. The guidance suggests that getting a very clear sense of the overall “deal” involved in a transfer as early as possible is essential, and avoids misunderstandings later on – one case study in the “good practice in negotiations” factsheet is of a local authority who thought they owned the car park around the community centre being transferred, and then “discovered” half way through the process, that actually it belonged to the local school.

The guidance also acknowledges that there are genuine differences of perspective between public sector bodies and community organisations, which can only be dealt with through negotiation to hammer out the details. However the guidance suggests that, with patience, good humour, and a level head, it is possible to get through the process – and, having done so, to achieve all those apparently contradictory outcomes.

David Alcock leads the work on asset transfer at Anthony Collins Solicitors (www.anthonycollins.com). He can be contacted by email at (This email address is being protected from spambots. You need JavaScript enabled to view it.).

The ATU are very keen to hear what local authorities think about the various tools, both in theory and in practice. Please address all feedback on the legal tools to This email address is being protected from spambots. You need JavaScript enabled to view it..