Government urged to roll out community investment bonds across the country after Sheffield success
Sheffield’s climate bonds “make people feel like the council is theirs again”
A university report has encouraged nationwide uptake of Sheffield's community investment scheme in Andy Burnham’s plans for devolution.
Community investments operate like Premium Bonds: From as little as £5, people loan money to UK councils for a return of interest paid every six months.
In Sheffield, the investments have raised £1 million for climate projects across the city, including ‘solar on schools’.
21 schools across the city will benefit from rooftop solar panels, helping schools generate their own clean electricity and reduce energy costs as part of the scheme.
A report by the University of Leeds has now called on the government to implement these community investments nationwide, as the Prime Minister plans further devolution.
The report looked at the success of the schemes across 19 councils who together have raised almost £30 million for community projects.
It found that community investments are building trust between residents and their councils, improving places and restoring pride in the work of local government.
Councillor Minesh Parekh said: “It’s participatory. And I think that’s a real strength of it. It gets people on board with the idea that they’re doing things in their areas.
“People often feel so separated from decisions that are taken for them, rather than by them. So things like this break down those barriers.
“Even if they don’t invest in it, people feel really involved in it because it’s a mass thing that the community is involved in. There’s a lot of value in it because it makes people feel like the council is theirs again.”
The ‘Sheffield Climate Investment 1’ came with an interest rate of 4.1 per cent a year over a five year term, meaning £1,000 invested this year could return £1,222.51 by 2031.
This first phase of Sheffield Climate Investment closed in January 2026, after meeting the £1 million target, but it is understood the next phase will open before the year is out.
The initiative in Sheffield focuses on renewable energy, after the council declared a climate emergency and is working towards becoming a zero-carbon city by the start of the next decade.
Coun Parekh added: "The climate crisis is one of the greatest challenges we face."
Professor Mark Davis, who wrote the report said: “As the UK sets about rediscovering pride in its civic mission, the local climate bond model enables councils and residents to work together to fund meaningful green and social projects in the community.
“With a rate of return equivalent to high-street savings and investment products, the bonds also ensure investors can see exactly what their money is doing.
“The suite of solar projects now being delivered for schools by Sheffield City Council are a perfect example of how every pound invested this way goes directly towards making real and meaningful local improvements.”
Prof Davis urged the government to promote community investments as part of its devolution plans.