Financing community : economic development in New Zealand

Abstract

Community economic development and social enterprise are growing fast across the globe in both developed and developing countries. They are major components of a new economics arising from the failure of traditional approaches to address the effects of complex and intractable social, economic and environmental problems. This paper examines how community economic development and social enterprise are currently financed in New Zealand. It suggests some alternative approaches and makes recommendations to stakeholders to reduce barriers, promote best practice and improve success factors. The initial discussion uses the findings of a comprehensive research process completed in 2014 by the New Zealand Community Economic Development Trust to understand the New Zealand context for community economic development and social enterprise. The discussion then outlines some alternative social finance approaches used in the UK, Canada, Ireland and Australia, and their potential use in New Zealand if certain barriers are removed and best practice models are used. The final section considers the potential for self-­financing by the not-­‐for-­‐profit sector based on data collected by the author over a two-­‐year period. Recommendations are made on how access to finance by community economic agencies can be improved, and the potentially ‘game changing’ impact of such access. The author of this paper has an extensive background as a practitioner and academic in the community economic development and social enterprise sectors, both within New Zealand and overseas.