Written by Johanna Knox, it tells the story of community currencies, with a focus on the time banking system that the small town of Lyttelton has pioneered.
Lyttelton was at the epicentre of the February 22 earthquake. The disaster claimed two local lives, tore up homes and livelihoods, and reduced the township’s treasured historic buildings to rubble. Now, with no end in sight to aftershocks, you might think Lyttelton would be (to use a phrase the media has become fond of) a town ‘on its knees’. Instead, this small port community defies anyone or anything to break its spirit.
Its people rushed to help each other as soon as the February quake hit. Just four days later, as hillsides continued crumbling and more streets were evacuated, residents gathered in a park for an all-day party, celebrating their strength.
What’s their secret? Margaret Jefferies, Chair of Project Lyttelton, says, ‘Much – but not all – can be attributed to our community time bank.’
The Lyttelton Time Bank initiative has been running since 2005, but has only recently come to wide attention. When the first major quake struck in September 2010, Lyttelton people didn’t wait for authorities to help. Thanks to their Time Bank network, locals who could offer help or resources were rapidly connected with those who needed them.
After the far worse destruction wreaked by the second quake in February, the Time Bank’s value has been in greater evidence than ever. Jefferies says, ‘It’s as though the first [earthquake] was a rehearsal for the devastating one.’ At the local emergency centre, Civil Defense, Council, and other volunteers work closely with the Lyttelton Time Bank – because it provides ‘an amazing network of people with identified skills’ that can be tapped into fast.
Groups like the Time Bank quietly exist the length and breadth of the country. A time bank is a community currency. Community currencies take diverse forms and go by many names, but are always underpinned by the conviction that the national dollar is not the only way to trade, and that using a ‘complementary currency’ brings myriad benefits.
Community currency fans enthuse about making new friends, supporting their local economies, decreasing food miles, reducing debt, feeling extra cash in their pockets, and discovering skills they didn’t know they had.
Time banks are proliferating in New Zealand, and just as prevalent are local exchange trading systems (LETS) – sometimes called green dollar schemes.
In both systems, transactions are logged on a central database, or use vouchers. Members trade with whoever in their local system they want to, and check their balances like a regular bank account.
In a time bank, the unit of currency is an hour. Participants earn hours of someone else’s time by giving their own. It’s an egalitarian system; whoever you are and whatever you do, your hours are worth the same as everyone else’s.
One important rule ensures that time bank trades are not subject to tax: you cannot trade services related to your normal business activity.
Jefferies says a time bank unites people from all walks of life. It’s ‘like the blood supply through the body of the community. It facilitates, it links, it feeds our humanity.’
The Lyttelton Time Bank was New Zealand’s first. With a grant from the Tindall Foundation, it developed a system tailored to its locale, but ready to be adapted to others. Since then Lyttelton has supported the blossoming of time banks in Kaitaia, Whakatane, Otaki, Gore, and two suburbs of Christchurch.
With more in the pipeline, Jefferies and her colleagues hope soon to launch a national time bank organization, although local earthquake relief efforts take first priority.
Helen Dew, a founding member of the Living Economies Trust, which fosters community currencies in New Zealand, sees a core difference between a time bank and a LETS: ‘The primary purpose of time banking is community building, whereas a LETS enables its members, including business participants, to trade in goods and services, with community building a spin off.’
A LETS, or green dollar scheme, has its own unit of currency, generally equivalent in value to the national dollar. On joining, you open with zero in your account and can start trading immediately – sell and go into credit, or buy and go into debit.
Debt is not frowned on; the system couldn’t work without it. But members should move between debit and credit at least once a year, and so no one goes irretrievably into debt or hoards credit, members keep within certain limits on either side of zero. Amongst New Zealand LETS, limits range from 100 to 1000 currency units.
Perhaps most importantly, debt in a LETS scheme attracts no interest.
Dew is an active member of the Wairarapa LETS, which calls its currency units WAIS. As well as selling excess garden produce, she’s a local distributor for Bokashi composting systems and Koanga seeds. She trades happily in WAIS, conventional cash, or a combination of the two.
Several years ago she renovated her home, paying around WAI$3,000 to fellow LETS members for labour and NZD$8,000 to local businesses for materials. She says it was a ‘win win’. She avoided a bank loan, local businesses benefited, and work went to locals who wanted it.
The Wairarapa has been hit hard by the current economic crisis, and Dew says LETS allow communities like hers to genuinely add to their wealth – and keep it there. ‘One hundred percent of the wealth generated from exchanges within community currencies is retained and recycled locally’.
Golden Bay is home to one of the country’s most successful LETS. Around 8% of the population participates – 420 people.
LETS have a way of getting puns and acronyms flowing. Golden Bay currency units are HANDS (How About A Non-Dollar System), and co-ordinator Joanna Piekarski holds the official title ‘HANDy messenger’.
She subscribes new members, sends newsletters, organises events, ensures balances stay within their limits, brokers sales, and more. ‘I'm just generally helpful to members to keep everyone happy.’ She earns a few HANDS for what is in theory two hours’ work a week, but in practice, much more.
While regular money is often compared to oil greasing the wheels of an economy, Golden Bay folks see their community currency as something stickier – a ‘social glue’. Quarterly markets, where members are paid to have stalls, are highlights of the local social calendar.
LETS schemes often offer a way to afford a few luxury items, but can cover basics too. Piekarski says members have used HANDS to buy food, get cars repaired, and even pay part of their rent.
In response to Government funding cuts to community education, Golden Bay instigated its own programme where HANDS members teach classes and students pay partly in community currency.
Recently launched is ‘Young HANDS’, allowing Golden Bay children to open their own HANDS accounts without the small levies adult traders have, and with lower credit and debit limits. Budding entrepreneurs offer baking, handcrafted jewellery, dog walking, and chess help.
Other LETS schemes are in various stages of development around the country. Whanganui, for example, has REBS (River Exchange & Barter System), with a 2009 turnover of $R22,594.
Taking the art of the acronym to new heights is Ooooby (Out Of Our Own Back Yards). Initiator Pete Russell credits his wife Katherine with the name: ‘I came up with Oooog, Out Of Our Own Gardens, but Kat trumped it.’
Ooooby’s raison d’etre is to support local produce, and encourage home food growing.
Ooooby organisers wanted to make it as rewarding as possible for home gardeners to grow abundantly and trade amongst themselves. The answer was a special Ooooby currency, and what else could this small store of value be called, but a Roooby?
Russell and cohorts began Ooooby in Auckland and have watched the idea take off across the country, aided by an Ooooby social networking site they set up on Ning.
While Ooooby supports backyard growers who’d never produce the volume to sell in supermarkets, a project in the Manawatu town of Ashhurst takes a different tack, placing businesses at the forefront of their efforts.
LOAVES (Local Origin Ashhurst Voluntary Exchange) was cooked up by Sharon Stevens with help from her husband Phil, a team of volunteers, and a grant from Palmerston North City Council’s Local Initiatives Fund.
Phil Stevens explains, 'We haven't yet formally launched, and that date will be determined by a critical mass of business participants in the scheme ... We have over 30 individuals who’ve pledged to use the currency, and over a dozen businesses have expressed early interest in a commitment to accept the currency.
‘Working with businesses helps to make LOAVES visible and viable, and it creates a strong core for a vibrant small economy.’ Additionally, the team hopes to structure their system so that if New Zealand should enter a period of financial volatility, businesses could maintain stable prices when using LOAVES.
Especially important is for LOAVES to equal New Zealand dollars. It means ‘businesses don’t need to do additional bookkeeping -- trading in LOAVES will have the same tax and accounting implications as the cash economy.’
Despite their current business focus, Stevens says, ‘We're at least as interested in household-to-household trade … and we're asking people to consider what they will grow or make, and what skills they will trade …’
Perhaps they don’t need to ask. Users of time banks and LETS often say there’s something about the very act of joining such a system that has you asking yourself not just, ‘What could I buy?’ but, ‘What else could I offer?’
Since the onset of the economic crisis, we hear exhortations from many sides to consume less and produce more. Community currency advocates say their projects encourage exactly this change in mindset. But they also remind us that it’s not just about the money.
As Margaret Jefferies says of the Lyttelton Time Bank, it ‘builds social capital’.
Living Economies Trust
Lyttelton Time Bank (with links to other time banks in NZ)
The Community Exchange System – an international network of LETS where most New Zealand LETS are housed
The LOAVES project
The Complementary Currency Resource Centre
The Role of Time Banks in Crisis Response, from Community Currency Magazine, 10 March 2011