Construction and road closure signs under Toronto's Gardiner Expressway.
Toronto's Gardiner Expressway. Credit: Maarten van den Heuvel / Unsplash Credit: Maarten van den Heuvel / Unsplash

Immediately after Oliva Chow was elected to be mayor of Toronto, the conversation shifted to the coffers. Toronto has an over $1 billion financial hole to close. There is simply no money, analysts have insisted, for a progressive mayor to invest.

But there actually is a huge source of progressive investment ready and waiting to be unleashed in the form of procurement. If it is unleashed, past examples suggest it could significantly increase tax revenue flowing into those coffers for ongoing public investment, creating a virtuous circle. And the best part is that the foundational Social Procurement Program already has a weak draft in place, as well as 18 complicit AnchorTO institutions with annual spending budgets north of $20 Billion.     

The trouble is, Toronto’s Social Procurement Program was enormously watered down before its release in 2016. This has held it back from being a major Community Wealth Building (CWB) mechanism for seven years now. 

If Chow gets council to approve an update, however, it can get the wheels of progressive generators seriously in motion.

Community wealth building

Starting about 18 years ago, CWB emerged as a method of economic development, and entails that assets like real estate, businesses, bank accounts, are owned locally and through inclusive models. This allows communities to start with existing assets—rather than offering subsidies to the rich to attract outside corporations—and to build wealth continuously for the benefit of local citizens.

CWB began in Cleveland, where the Cleveland Foundation addressed the classic Tale of Two Cities dynamic: an affluent area bordered by a neighborhood of staggering poverty, the latter with a median income of just $18,500 a year. 

The Cleveland Foundation gathered a network of local anchor institutions: public and non-profit enterprises unlikely to leave the community, such as municipal governments, universities, hospitals, libraries, transit commissions, and religious institutions. The Greater University Circle Initiative (GUCI) had a collection of such anchors commit to an ethos of “buy local, hire local, live local,” turning procurement away from offshore tax havens and into their own neighborhoods. 

From there, the American think-and-do tank Democracy Collaborative helped develop more inclusive and democratic ownership structures for local investment to expand. 

Most notably, they worked with the city to foster the Evergreen Cooperatives: eco-friendly co-operatives that are owned and democratically controlled by their workers. The Evergreen Cooperatives have now grown to some 400 employees—primarily people of colour—and have created a fund to help workers purchase their companies from retiring baby-boomer entrepreneurs, saving even more companies and jobs in Cleveland. 

This combination has proved both ethical and profoundly practical: when anchor institutions purchase from local worker-owned companies, the profits go into the hands of many people who live and spend locally. That means both more investment and re-investment – circulation, velocity of money, etc. – into local enterprises. 

A larger version of this model was taken across the pond and further refined in Preston, England. There the Labour-led council directed anchor institutions and pension funds to massively increase their local procurements, while substantially expanding employee, co-operative, and community owned assets as well as living wage jobs. 

Growing local prosperity in turn led to more tax revenue and increased public investment: a virtuous circle. In 2018, Preston was named the Most Improved City in the UK by PricewaterhouseCoopers and Demos, and CWB went viral as an international movement. Last year, Preston was named the Best City to Live and Work In in the English North West for the third time.

Today, CWB is used from small towns to giant metropoli like Chicago, Denver, London, and Amsterdam. In Scotland, it has become increasingly central to the national economic agenda. Its ability to shorten supply chains and foster eco-friendly businesses has also made it go-to methodology for ecological economist Kate Raworth of Donut Economics, and famous social scientists like Richard Wilkinson and Kate Pickett list its strategies for developing a more equal society with better health outcomes. The list goes on.

The Toronto Story

The list should have included Toronto as well. 

In 2015, Toronto City Council unanimously accepted the poverty reduction strategy TO Prosperity.The following year, the City appeared to follow the strategy’s recommendations, implementing a Social Procurement Program and sparking the creation of AnchorTO: a collection of some 18 Toronto anchor institutions with annual spending budgets of about $20 billion. Toronto appeared poised to become a hotbed for CWB.

The recommended actions behind these initiatives were splendid. Consider some of those listed in the “Quality Jobs & Livable Incomes” chapter: “champion a living wage standard” and support vendors who follow it, using job quality assessments to guide city jobs and procurement, design community benefits programs and a procurement policy for city assets, work with anchor institutions to support local businesses, job-seekers, and worker co-operatives, and design models for economic development in low-income areas, among others.

The actual Social Procurement Program that council implemented, though, incorporated very few of the aforementioned recommendations. There is mention of social purpose enterprise, which is a step in the right direction and should be kept. 

Nevertheless, there is nothing about using job quality to guide procurement. There is nothing about prioritizing living wage employers, nor worker-and community-owned enterprise. There is nothing about increasing the percentage of procurement done locally. And there is nothing about investing in underprivileged neighborhoods.

On the contrary, “social procurement” here is defined as attempting –with no mandatory number– to have more bids from “diverse suppliers” and companies with a “workforce development component” at some point in their supply chain. This has to do with either the owning capitalists being at least 51 per cent from equity seeking demographics –women, BIPOC, LGBTQ+ identifying people, people with disabilities–, or having training and employment opportunities for equity seeking groups. 

De-prioritizing affluent straight white male owners might very well be useful. However the definitions used here would still dubiously count a company owned by, say, Donald, Melania, and Ivanka Trump as “equity seeking,” regardless of the state of their workers. Likewise, since training and employment opportunities have no job quality mandate, a corporation that employs people in poverty and pays them below a living wage can actually seek priority.

And besides, none of these objectives are binding in any way. Indeed, it’s hard to find evidence that the policy has seen much use.

AnchorTO, which really could change Toronto’s economic model, is caked in language about the value of CWB. But it is based on the city’s Social Procurement Program, rather than global work on CWB. One university appears to have directed its food supplier to purchase produce from local farms, but otherwise, it’s hard to find what has come out of it. 

The AnchorTO website says a report is “coming soon.” I don’t know how long that status has been there.

An honest assessment of the City’s current Social Procurement Program invokes Gertrude Stein and Shakespeare: there’s no there there, and nothing will come of nothing.

Chow and now

We’ve seen how far off the rails Toronto’s Social Procurement Program was taken. Let’s recognize, though, that it is astonishingly easy to fix. The surprise election ending with a progressive-minded new mayor provides just the opportunity to make that fix. 

All that needs to happen is for Council to actually put the 8-year-old “unanimously accepted” recommendations from TO: Prosperity into the Social Procurement Program. A simple redraft to prioritize local, living wage, and inclusively-owned companies, as well purchasing from underprivileged neighborhoods can, in one fell swoop, unleash investment from the City, rope in the massive Anchor TO network, and grow the number of community partners using its policy to get investment into their neighborhoods.

Indeed, it could set an example for other Ontario cities to follow.

Olivia Chow campaigned on change, but she also needs change to get things done. If she starts by redrafting the Social Procurement Program, she can make the rest of her job—and everyone else’s—a whole lot easier.

Colin Bruce Anthes

Colin Bruce Anthes is a Canadian artist, educator, and organizer focused on democratic economics. He has served as artistic director of two theatre companies, taught in five post-secondary institutions...