How effective was the Locally Trusted Organisation model in supporting community-led work?

A Locally Trusted Organisation (LTO) was a mechanism to channel funding from the Big Local programme into the 150 Big Local areas. They enabled unincorporated resident-led partnerships to remain free of the regulation and procedures that come with charitable or corporate status, so they could quickly focus on issues that mattered to them and decision-making. 

Local Trust has explained what LTOs were and how they operated in an accompanying article.

The core role of a LTO was as a ​‘banker’ for the Big Local partnership – to receive, administer, distribute, and report on Big Local funding. This created a ​‘triangular’ relationship between Local Trust, the LTO, and the partnership. LTOs also performed roles beyond that of ​‘banker’: most commonly, they employed (or subcontracted with) workers who managed projects and engaged in community development activities for the partnerships. 

LTOs were also expected to support Local Trust’s values of resident-led decision making and control. They also provided a range of support outside their specified responsibilities (Dobson et al., 2022). Big Local reps reported that this included relationship-building (for example, between partnerships and local government); providing space and equipment for office work or events; advertising; support with recruiting and managing workers; contract management and procurement; and help with bigger projects such as setting up community hubs. Partnerships valued the overall support from LTOs – in a 2022 survey, 77 per cent of members from partnerships who were not their own LTO, found the support ​‘helpful’ or ​‘very helpful’ (and 13 per cent found it ​‘not very helpful’ or ​‘not at all helpful’).

LTOs’ activities helped to build social, economic, and cultural capital in Big Local partnerships (Dobson et al., 2022). 

Social and human capital can be seen in terms of growing Big Local residents’ skills and confidence; learning by introducing them to relevant networks; encouraging aspirations and ambitions; and mentoring. LTOs often played the role of ​‘critical friend’, helping residents to understand the implications of their proposals and navigate local bureaucracy. 

Economic capital consists of financial resources and assets. Though it also relies on physical resources (like accessing space for meetings and events), and institutional capacities (like taking on workers to put Big Local plans into action and accessing funding and contracts beyond the Big Local grant). 

Local Trust explores how Big Local contributed to local economies by using a capitals approach in an article series.

Cultural capital includes reputation and connections. As Big Local partnerships became established, they became credible partners for local organisations and were seen to represent the local community. Cultural capital also includes access to decision-making structures (like local authority decision-making), effective governance (knowing how to run an organisation responsibly), and risk management (understanding where plans might go wrong and anticipating problems).

Sometimes LTOs’ role in supporting residents became more proactive than anticipated. In some areas LTOs became active voting members of partnerships, and even without a vote they were often present at partnership meetings and highly influential because of their knowledge and experience (McCabe et al., 2017). 

Partnerships needed different forms of support at different times (Wilson et al., 2023). These needs fell into three broad phases – getting started, consolidating, and spending out (the final years of a partnership). While much of this support was provided at a programme level (often via Big Local reps), LTOs played important roles throughout, especially in the start-up and consolidation phases. For example, LTOs employed workers, delivered activities and services, and held leases (Wilson et al., 2023). 

Several conditions could give partnerships an advantage in achieving their aspirations: like helping build community leadership and relationships with other organisations, and enabling access to community-controlled spaces where people could meet (Wilson et al., 2024). Sometimes community leadership meant that residents dominated, while in others direction was more clearly provided by workers, Big Local reps, or LTOs. In each case the important factor was a sense that people were working together for the good of the community (Wilson et al., 2024).

To build residents’ skills and confidence, LTOs needed particular skills themselves. Residents chose their LTOs for various reasons and sometimes there were gaps – for example, not all LTOs had experience of working in a situation where residents controlled resources. 

LTOs needed to manage the legal, financial, and administrative structures relating to their functions, and Local Trust undertook due diligence checks to ensure they could do this. The five per cent contribution payable to a LTO by Local Trust (separate from the Big Local partnership grant), was one example of such a system, as it provided a dedicated resource for administrative costs or other support for their Big Local partnership(s). LTOs also needed the relational skills to build a sense of trust and shared endeavour with residents: listening, communicating well, and having processes for mediating disputes and misunderstandings.

There are two pillars for supporting positive and empowering relationships – ​‘building’ and ​‘dwelling’ factors (Dobson et al., 2022). Building factors are the processes required to support positive relationships: LTOs’ banker and governance roles, procedures for employing workers and managing contracts, and agreements on accountability and communication. They also include the support Local Trust offered to LTOs through programme guidance, events, and Big Local reps. Dwelling factors concern the way relationships develop: attitudes and behaviours, soft skills for navigating relationships, shared understandings of residents’ histories and aspirations, listening and responding empathetically, and being partners in a common story. These attributes require consistent and sustained co-working.

While both building and dwelling skills were important, the way they were deployed to meet residents’ needs varied. Some LTOs performed the building role effectively but did little more, sometimes this was all residents wanted, but for others it fell short of their needs and expectations.

A major challenge was being clear about who should do what, as the triangular model of LTOs, resident-led partnerships, and Local Trust (plus a network of Big Local reps) was new for everyone. Though, the main function of acting as an accountable body would have been familiar to LTOs with experience of previous regeneration programmes. There was often a lack of clarity about the extent of LTOs’ remit and Big Local partnership members or LTO staff who joined later sometimes struggled to understand the different roles and responsibilities (Dobson et al., 2022). While LTOs were expected to support Local Trust’s values of resident-led decision making and control, in practice this didn’t always align with the hopes and expectations of partnerships. In a 2024 survey of partnership members, 61% of respondents agreed that their LTO provided an appropriate level of influence in decisions made by the partnership, compared to 85% agreement for Local Trust advisors (formerly known as reps) and/​or Local Trust area co-ordinators, and 77% agreement for Big Local workers.

Local Trust explores the roles of reps and paid workers in upcoming articles. 

For some partnerships the model felt cumbersome, and they felt LTOs (or workers, employed by the LTO for the partnership) were slowing things down or making decisions that should be made by residents. Conversely, some LTOs feared partnerships were rushing decisions. This meant that the triangle had to adapt to reflect local relationships.

LTOs faced further practical challenges in their work with Big Local partnerships, including:

• turnover of staff and loss of know-how, including fully understanding the role of the LTO in Big Local, especially as it changed over time
• aligning Local Trust’s financial contribution with work done (it was dependent on what the partnership spent in a year, rather than the work needed to reach the point where the partnership could spend the money, and varied year to year) 
• capacity to perform the core roles effectively and financial sustainability, including setting up and maintaining appropriate accounting and management systems
• transparency and flow of financial information (partnerships sometimes felt they were not being kept in the loop). 

As discussed above, this was accompanied by various relational challenges:

• keeping within their remit and not taking the strategic planning and financial decisions which should have been residents’ responsibility
• maintaining good relationships with Big Local reps
• resolving breakdowns in trust with residents
• aligning attitudes to risk with residents’ expectations (LTOs were sometimes perceived as risk-averse) 
• fully informing partnerships of financial issues and making payments promptly.

Local Trust supported LTOs through programme guidance; access to Local Trust staff; support from Big Local reps; learning and networking events; informal drop-in sessions for LTOs; and peer learning and networking spaces. However, many LTOs did not access all this support and there were variations in how guidance was interpreted locally (Dobson et al., 2022). 

Several factors enabled LTOs and Big Local partnerships to overcome challenges together, like the security of funding from Local Trust through their five per cent contribution to the LTOs. More generally, efficient financial and administrative systems helped build positive relationships and trust, and – with Big Local being a multi-year programme – LTOs and partnerships were not pressured to spend money within a financial year so as to not lose it. 

A sense of shared values and time for building relationships between different professional worlds (like local government and the voluntary sector) helped LTOs and their resident partners overcome challenges. This was supported by training and networking offered by Local Trust, regular reviews of the partnership’s progress and needs via Big Local reps, mediation by Big Local reps, and induction materials for new resident board members. As the programme matured, one reflection from Local Trust was that it could have done more to directly support LTOs to fulfil their responsibilities. For example, through a formal induction, more explicit information on how to be an LTO, and helping LTOs better understand the Big Local programme, the LTO model, and their role and responsibilities within that.

A significant factor in the effectiveness of LTOs was their ability to respond to the changing needs of Big Local partnerships, including governance issues. Sometimes the role of the LTO had to evolve with changing responsibilities, and sometimes the organisation performing the role had to change – either to a different LTO, or by the partnership taking on the LTOs’ responsibilities.

Not all LTOs continued to fulfil the same role throughout the programme. In some cases, partnerships changed LTO because the relationship was not working or the LTO could not give the partnership the support it needed. In a few instances the LTO faced financial challenges and Local Trust helped to broker a move to a new LTO. But there were also examples of Big Local partnerships taking on more responsibilities and forming new organisations or becoming their own LTO by becoming incorporated (Dobson et al., 2022). 

The ​‘be your own LTO’ approach was sometimes seen as a natural progression, with partnership members noting motivations from frustration with existing arrangements to a continuation of their path to maturity. In several cases the key contact from the LTO moved to work directly for the partnership, making members more confident in incorporation because they knew they could employ someone reliable.

Partnerships that had accessed funding from sources outside Local Trust sometimes felt they were better placed to manage multiple funding streams as a LTO. For these groups, taking on roles previously done by the LTO simplified their financial operations.

Different challenges arose as partnerships prepared to exit the Big Local programme. Partnerships wishing to continue had to consider how their LTOs’ work to support them and provide financial accountability would be done in future. There were different ways to address this challenge, including merging with an existing organisation that shared the partnership’s ethos and aims (like a charity, housing provider, or social enterprise) and setting up new organisations, which many partnerships considered. 

New organisations could be set up in different ways, including as registered charities, Community Benefit Societies, or Community Interest Companies trading with a social purpose for local benefit. Local Trust provided guidance, examining the pros and cons of different structures and highlighting the need for the partnership to approve future arrangements (although post-Big Local legacy organisations did not have to meet the same requirements for resident control). A key risk moving beyond Big Local without a LTO, was the loss of community accountability and control, especially if assets such as buildings were managed as commercial assets. For example, Community Interest Companies can protect assets for community benefit through an ​‘asset lock’ and raise money by trading, but having to raise money may shift focus away from activities that don’t generate income. 

All the options presented technical and relational challenges as the partnership wound up or adopted a new form. Staff contracts and service agreements had to be terminated or put on a new legal footing, assets disposed or transferred, and the role of any legacy body agreed. LTOs, as established organisations with similar values to Big Local partnerships, were able to provide valuable insights about what life after Big Local might look like and experience in governance, financial sustainability, and managing staff and contracts.

LTOs fulfilled a wider range of functions than expected, responding to residents’ changing needs. The model became more flexible over time, with the option of changing LTOs or for partnerships to become LTOs themselves. The approach could be transferable, but arrangements should not be too rigid at the outset. 

The Big Local experience highlights how relational skills are as important as the financial and governance skills of the LTO model. LTOs often succeeded or stumbled because of the strength of their relationships with their Big Local partnerships. Where relationships worked well, LTOs could act as critical friends and advocates for their partnerships and build residents’ confidence and standing.

However, such skills took time to develop, and relationships needed nurturing, which was not accounted for in the five per cent contribution payable to LTOs. Additionally, the contribution reflected actual spending by the partnership rather than the work involved in getting to a point where money could be spent well. This could be adjusted in future programmes. 

Big Local’s success showed that the LTO model works for channelling funding to resident-led partnerships to enable them to lead long-term plans for community benefit; and for helping to build social, economic, and cultural capital in disadvantaged neighbourhoods. The model is readily transferable for putting communities in charge of significant sums of money. Although, it would benefit from clearer lines of accountability and adaptations to the LTO funding model to enable a closer match between the money paid to the LTO and the work done.