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An Introduction to CounterCoin (by Brian Leyland)

An Introduction to CounterCoin (by Brian Leyland)

21 Dec 2018
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Our colleague Brian Leyland, has written this fairly weighty but informative INTRODUCTION TO COUNTERCOIN piece. It’s mainly for internal purposes but we think it’s worth sharing.

Have a read of it if you are interested in discovering more about CounterCoin.

CounterCoin is a groundbreaking volunteer reward scheme, under which time spent by volunteers making a contribution to community or which is of benefit to society is recognised by the payment of a token known as CounterCoin.  The objectives of the scheme are to:

  1. support those in socially and economically disadvantaged communities who feel alienated and disenfranchised from modern society, to feel valued and to increase their sense of self worth, self esteem and self confidence;
  2. reduce loneliness by providing an opportunity for individuals to engage and work with others in a constructive manner;
  3. provide a pathway to employment for those who are currently unable to secure permanent jobs;
  4. help revive the sense of community, identity and belonging by rewarding collective effort whist at the same time developing individual skills and potential;
  5. promote good citizenship by encouraging the local population to take a pride in their community and to want to make a difference;
  6. enable businesses to make a contribution to community at little or no cost to themselves;
  7. support charities and social enterprises by making it easier for them to attract volunteers and thereby to help them achieve the objectives for which they were set up;
  8. create a more efficient local economy by utilising spare capacity and goods which might otherwise go to waste as rewards for making a contribution to the community; and
  9. help struggling communities become more inclusive, sustainable and resilient in the face of the challenges presented by the modern world.

THE STORY SO FAR

CounterCoin was the brainchild of Mike Riddell, a director of Hometown Plus Limited, a company which seeks to restore both community and commercial prosperity to towns which have been left behind in the post industrial world.  The concept has evolved over a number of years and has been piloted in the last year by the social enterprise Cultural Squatters, which is located in York Place in Newcastle under Lyme and also by the YMCA at their branch in Hanley, Stoke on Trent.  

On 23 November 2018, the CounterCoin Challenge took place.  This was a promotional event to raise awareness of CounterCoin and with a view to increasing the number of volunteers, social enterprises and charities and businesses who want to be part of a growing movement.  The Challenge involved members of the public in 7 separate locations, one in each of the Six Towns and Newcastle under Lyme, competing to see who could make the most coins in a single day. The coins were made out of clay in a nod to the heritage of the Potteries.  The day was a major success and generated significant radio, newspaper and social media coverage.

WHO OWNS COUNTERCOIN?

All the intellectual property attaching to CounterCoin is owned by Hometown Plus Limited.  The name “CounterCoin” has been registered as a trademark. However the intention is that Hometown Plus will grant to CounterCoin Community Club Limited (“CCCL”) an exclusive licence to operate CounterCoin.  CCCL is a “not for profit” company limited by guarantee which intends to apply to the Charities Commission for registration as a community capacity building charity.

Hometown Plus Limited is represented on the Board of Directors of CCCL but there are a majority of independent directors.  The terms of the licence between Hometown Plus and CCCL will be disclosed to the Charities Commission to ensure there is full transparency attaching the commercial relationship between the two entities and to satisfy the Charities Commission that Hometown Plus Limited is not exploiting the charitable status of CCCL for its own commercial purposes.

Overall control of CCCL is exercised by its Board of Directors which has determined a set of rules (the “Rules”) for the operation of CounterCoin.  Local boards will be set up in each area in which CounterCoin is being issued and they will be responsible for administering its operation in their respective areas within the framework of the Rules.

HOW DOES COUNTERCOIN WORK?

CounterCoin can only issued by social enterprises and charities which use volunteers.  The issuers must be able to show how the issue of CounterCoin will help further the objectives of CCCL (“the CCCL Objects”) and that the volunteers to which it is being paid are carrying out qualifying activities (as defined in the Rules) – broadly those which involve a contribution to society and / or promote good citizenship.

The social enterprise / charity will pay each volunteer 5 CounterCoin for each hour they carry out qualifying activities, irrespective of the nature of type of duties carried out.  The volunteers are then free to redeem the CounterCoin they have received in exchange for goods and services supplied by participating businesses.

Whilst any business will, subject to certain exclusions, be eligible to participate as a redeemer, CounterCoin’s main focus is on local businesses and particularly those which currently have either goods which go to waste or surplus capacity.  So, for example, if a local food outlet has perishable goods approaching their sell by date, it might choose to redeem CounterCoin in exchange for these goods which will prevent them going to waste. Cinemas, football grounds and other entertainment outlets may have regular seats which are not filled – CounterCoin could be accepted by them in part or full payment for a seat not purchased, say, an hour before the event begins.  Leisure venues will have quiet times and may also choose to accept CounterCoin in part or full payment for entry in these periods. A business may of course also choose to accept CounterCoin in part payment for goods on sale at normal price.

Whilst CounterCoin does not have a fixed value in £ sterling, it is recommended that businesses attribute a minimum of £1 nominal value to each coin redeemed (nominal value being the price at which the goods or services are available to the general public).

Once redeemed the business will return the coins it has redeemed either to an approved issuer or to CCCL.

WHAT ARE THE BENEFITS OF COUNTERCOIN?

CounterCoin delivers a wide range of benefits to all stakeholders – everyone has something to gain by supporting CounterCoin and, just as importantly, there are no losers.

For volunteers, the value of their contribution to society is recognised, which in turn improves their sense of self worth and self confidence.  Instead of feeling alienated from the modern world, they can begin to feel a sense of identity and belonging to the town or area in which they are living and take pride in its achievements.  By helping improve the life and other skills of volunteers, CounterCoin also provides a pathway to employment for many who have previously struggled to secure a permanent job. Alternatively it may give them the confidence to start out in life on their own, in whatever field that might be.  

For the social enterprises and charities, CounterCoin makes it easier to attract volunteers and also helps inspire and motivate them.  This has the consequence of helping the charities / social enterprises promote their own activities as well as achieve their own objectives.  It can also reduce their reliance on funding from other sources, which can be extremely time consuming to secure with no guarantee that anything will be received at the end of the process.

Businesses which redeem CounterCoin have possibly the most to gain.  

  1. It gives them an opportunity to make a contribution to community at no cost, whilst at the same time promoting their own businesses.  
  2. By utilising goods which would otherwise go to waste or underutilised capacity as rewards, they are creating a more effective business model.  
  3. Footfall will increase, which will then improve the experience for all other customers by generating the buzz that accompanies successful businesses in every sector.    
  4. By accepting payment in part cash, part CounterCoin, businesses can increase revenues by selling off spare capacity in a manner which does not leave regular customers thinking they have been short changed.  That way they can fill empty seats or generate activity in quiet times without devaluing the product which they are offering.
  5. There will inevitably be incidental spend by those paying in CounterCoin (refreshments etc) which will also add to potential revenues.

 

There are benefits from CounterCoin for the public sector.  In an age when government funding is on an ever downward path and the pressure on social services is consequently intensifying, CounterCoin can relieve some of the strain by reducing the number of individuals who are reliant on benefits and by supporting local businesses whose rates payments are now so critical to local authority revenues.

Finally CounterCoin has a huge positive impact on the local community. By reducing waste and utilising spare capacity it is creating a more efficient local economy.  It also helps struggling communities become more inclusive, sustainable and resilient in the face of the challenges presented by the economic, environmental and political crises that confront our society today.

 

WHAT IS THE PROCEDURE FOR ISSUING COUNTERCOIN?

Social enterprises and/ or charities which use volunteers may apply to the local CCCL board for authority to issue CounterCoin.  In the application they are required to:

  • describe the volunteer roles for which CounterCoin will be issued
  • explain how the issue of CounterCoin will contribute to community capacity building as set out in the CCCL Objects
  • calculate the number of qualifying volunteer hours in respect of which it wishes to pay CounterCoin during the next 4 weeks.

If the application is approved, the local board will supply the issuer with the requisite number of CounterCoin.  This will be issued to volunteers at a rate of 5 per qualifying hour irrespective of the nature or type of the work done.  The issuer will maintain a record of the hours worked for each volunteer.

Whilst the local board will consider all applications, it is anticipated that some social enterprises / charities may use volunteers in respect of whom CounterCoin is not appropriate.  Others may use some volunteers to whom CounterCoin is paid, and some to whom it is not.

Volunteers can elect where and when to redeem the CounterCoin.  There will be no time limit on its redemption so volunteers will be free to accumulate CounterCoin to spend all in one go or alternatively can spend as it is earned.

Businesses which redeem CounterCoin must decide which goods or services they are prepared to offer as rewards and on what basis.  The prime objective of CounterCoin is to enable businesses to reduce waste by offering as rewards perishable goods which are approaching their sell by date or unused capacity – in either case there will be no cost to the business.  Businesses are however free to accept CountrCoin in exchange for goods on sale at normal price.

In all cases businesses must decide whether they are accepting CounterCoin in part of full payment and what value they attribute to CounterCoin.  It is recommended however that each coin is treated as worth a minimum of £1 nominal value (nominal value being the amount at which the goods or services are available to the general public).  

Once a business has accepted CounterCoin in exchange for goods or services it may either use the CounterCoin for approved purposes (as defined in the Rules) or will return the CounterCoin to the local board.

 

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