The impacts of social infrastructure investment

This June 2021 report from Frontier Economics for the Local Trust brings together existing evidence of the economic basis for investment in social infrastructure in 'left-behind’ areas, and calculates the economic, social, and fiscal returns on this investment. This resource is, therefore, useful for anybody making the case for greater investment in social infrastructure to enhance places and local communities.

Date added 28 September 2021
Last updated 28 September 2021

*This resource is about social infrastructure. It is not specifically about the High Street, but has been included in response to requests for more studies/information about this topic, as well as linking to liveability and networks priorities for High Street vitality and viability*

This report begins by outlining the importance of social infrastructure investment in order to contribute to the 'levelling-up agenda’. The authors observe, for example, that recent analysis has identified 225 'left-behind' areas as both lacking in social infrastructure and having high levels of deprivation. By social infrastructure, the authors refer to investments that seek to bring community groups together and foster personal relationships, whether that’s places and spaces (e.g. arts centres, greenspaces, sports clubs), community organisations (e.g. voluntary groups, social enterprises, and charitable groups), and connectedness (e.g. community transport, walking/cycling infrastructure, and online communication platforms).

Although qualitative benefits of social infrastructure are noted, including improved social cohesion, civic engagement and reduced loneliness, this report focuses on the quantitative impacts. The report brings together existing evidence of the economic basis for investment in social infrastructure in 'left-behind’ areas, and the economic, social, and fiscal returns on this investment. The authors reviewed over 100 research papers in order to create this economic evidence base, using an approach inspired by the HM Treasury that recognised quantifiable benefits expressed in monetary terms, and that upheld the principles of being prudent (only quantifying outcomes with a robust evidence base), proportionate (uses best evidence available in the literature), and appropriate (utilising evidence appropriate to types of social infrastructure community-led investments would undertake).

Based on the above analysis, a framework for social infrastructure investment outcomes is provided. The framework identifies four types of outcomes from social infrastructure investment:

  1. Social outcomes – wider social benefits such as community health and wellbeing, civic engagement, and crime levels.
  2. Economic outcomes – employment rates, productivity levels, and average income.
  3. Fiscal outcomes – effects on government budgets and spending, including tax collected from a community, spending on benefits, and costs of local service provision; and
  4. Environmental outcomes – community’s biodiversity and greenhouse gas emissions.

Overall, it is calculated that a £1 million investment in social infrastructure in a left-behind area would be expected to deliver benefits over ten years of (p.27):

£2 million economic and social benefits:

  • Increased employment: £740,000
  • Increased health and wellbeing: £670,000
  • Increased GVA in local economy: £500,000
  • Reduced crime: £130,000.

£1.2 million fiscal benefits:

  • Employment healthcare savings: £520,000
  • Employment tax and benefits savings: £510,000
  • Reduced fiscal costs of crime: £80,000
  • Sports healthcare savings: £50,000.