About this project
- Date started:
- Number of people involved:
- 6 - 10
- Number of people benefitting:
- 500 - 1000
- Goals or benefits:
- Awareness raising
- Related Transition stage:
To make sure that wealth stays in the community where it will can be used in a more conscientious way with lower carbon impact, lower ecological impact and higher resilience.
A bit more detail...
A local economy is like a leaky bucket - wealth comes in and as soon as it is spent at a shop or business that has more connections outside Totnes than inside Totnes, that money disappears.
Local money doesn’t leak through the holes – it bounces around inside the local economy and maintains wealth.
Local money helps us think about our local economy, enquiring where our money goes once we spend it and finding ways to keep it from leaking out.
If we use our money for production and consumption closer to home, we're going to pay more attention to how those products are made, and the waste streams that result from them. It's similar logic to the premise that the Bhopal disaster in India would not have happened if the battery factory had been in the back garden of the Chief Exec of Union Carbide.
How it works
- You buy Totnes Pounds through one of the 6 Issuing Points in Totnes at £1 = T£1
- You can spend it at any of the 70+ shops or businesses in Totnes that display the “Accepted Here” logo
- You can get: food, taxi rides, clothing, household goods, bike repairs, haberdashery, shoes, artists materials, books
Timeline of the Totnes Pound
- Phase 1
- May 2007
- 300 Totnes Pounds given into circulation at a "Transition and Economics" event in the town
- 18 shops accepted it
- Phase 2
- August 2007
- 6,000 Pounds sold into circulation (T£10 for £9.50)
- 50 shops/businesses accepted it
- Phase 3
Outcomes so far
The Totnes Pound has been a huge awareness raising tool, not just for the initiative but for the ideas of transition generally. It adds to the sense of local distinctiveness and is very timely practice at a small scale of mechanisms that might be needed very badly in the not too distant future.
We're not under any illusions about transforming the local economy. Here's why.
- number of households in Totnes = 3000
- guess at the average household income = £20k
- Totnes economy = £60,000,000
- appx number of Totnes pounds in circulation = 6000
- therefore the proportion of Totnes economy that is represented by Totnes pounds = 0.1%
This is a very small amount, but that's OK. Local currencies come into their own when there's a shortage of the national currency, and what's crucial is that the communities who might experience this shortage have experimented with different models and can switch across to them with minimal disruption.
The Totnes Currency group is not an incorporated body yet. We started along the road of Industrial and Provident Society, and that stalled initially because the Financial Services Authority couldn't quite get their head around the project. It was also expensive.
We're currently trying to figure out the best corporate form, with IPS, CIC and "Not for profit limited company".
That's the most challenging, given the ubiquity of the competing currency and the fact that it could be considered an inconvenience to exchange sterling into Totnes Pounds. That said, there's still a huge affection in the town for the currency. Over the past 4 years, only two traders have said they don't want to take it any longer, while other traders are adding themselves to the list.
Our view is that we need a much more diverse infrastructure of local currency mechanisms - an electronic means of exchange, a timebank, a local credit guarantee agency, a physical currency, a partnership with a local credit union - in order to underpin and catalyse a more robust local economy.
What it has inspired
- Totnes’ currency experiment has inspired other towns to take this bold step: Lewes, Brixton, Stroud, Cardiff, Bristol
- In Italy, town mayors are resisting the economic hardships imposed by their government by launching local currencies
- Transition Towns around the world are thinking about how a local currency might help them
- We're recently (2013) been receiving enquiries from councillors who are thinking about how a local complementary currency might help their community, and who are looking for assistance
It's harder work than we imagined to keep it going, and there's an inevitable sag in use that comes after the first novelty phase. It has however maintained a high level of affection with the traders in the town.
The level of interest in the Totnes Pound took all of us by surprise. It featured globally, from the Buenos Aires Herald to the Norwegian equivalent of the Financial Times.
It's also helped larger more ambitious projects with local currencies to get funding - eg the Bristol Pound, a local currency system that involves online and mobile phone transfer of money, a physical currency and accounts held in the local Credit Union.
In the future (short term)
The Totnes Pound team is working with the Chamber of Commerce and a local foundation to move to a more active and integrated phase of development, with new t£1, t£5, t£10 and t£21 notes using a local designer, much more signage, proactive engagement with the traders and issuing points, and a robust communications strategy. We have created a one-pager outline plan for Phase IV based on a detailed survey and report on current usage and future needs. One particular innovation is the 5% Advantage discount scheme - traders in the town have responded very positively to it.
In the future (longer term)
The Totnes Pound, as a physical currency, is just the first small step into figuring out what kind of economic mechanisms are needed to support a robust local economy. There are lots of other developments being discussed:
- Electronic currency using the internet and mobile phones (as involved in www.bristolpound.org)
- More integration with TTT and the bigger project of REconomy
- Working with local credit unions
If you want to get involved, send an email to email@example.com
Links and partnerships
Key groups the Totnes Pound team is working with are:
- Totnes Chamber of Commerce
- Local credit union
- Transition Town Totnes
The council isn't on this list, and that's likely to change in the short term. We're also aiming to engage with the local banks (gonna be interesting...)
Sources of funding
The project team underwrote the initial spend, then the scheme has been self funding since that point. All of the team are volunteers and the costs has so far been negligible apart from the initial print runs of the notes. With one of the print runs, we paid for the work in Totnes Pounds.
How local currencies have helped communities
- There is a rich history of local currencies throughout the world
- In the US in the Great Depression, many local currencies helped communities survive tough economic times
- In Europe between WWI and WWII, Worgl in Austria lifted itself out of povery with a local currency – the only town in Austria that flourished during that period
- In Argentina when the national currency collapsed in 1990s, local currencies sprung into action and helped maintain wealth and health
- In USSR during their collapse, the used VODKA as currency!
What inspired us to create this project?
The works of Bernard Lietaer, Thomas Greco and the stories of local currencies that helped communities in times of stress, such as:
- USA in the Great Depression
- Argentina when the currency collapsed at the start of the 21st century
- Austria between WWI and WWII with its Worgl currency
- Greece in 2012!