Saturday, July 13, 2024

London council takes to crowdfunding drive to pay for green upgrades

In response to significant cuts in government funding, Southwark council in south London has launched a crowdfunding initiative to raise £6 million over six years for climate-friendly projects.

The scheme aims to finance initiatives such as cycle hangars, LED street lighting, and green upgrades at schools and leisure centers.

Facing financial constraints while needing to address the climate emergency, the council plans to offer residents a financial return on their investment, with an offer of a 4.6% return for investors. The initiative allows investments starting from as little as £5 and offers a fixed return of 4.6% per year over a five-year term, although investors are cautioned that their capital is at risk.

Despite receiving an extra £600 million cash injection from the government, many English local authorities are still grappling with funding shortfalls. Southwark council, like many others, is faced with the challenge of maintaining services while dealing with inflation and rising demand.

The crowdfunding scheme, managed by Abundance Investment, aims to provide a cheaper interest rate for the council compared to borrowing through traditional channels. Additionally, it serves to engage residents directly in the council’s climate emergency plans.

While the crowdfunding initiative is seen as a creative solution, it is acknowledged that it will not fully solve the council’s budget crisis. However, it is expected to accelerate the implementation of much-needed climate-friendly projects.