6 Limitations of LETS
Significant claims have been made about the benefits of LETS. For example, it is argued that LETS, by removing some goods and services from the cash economy, reduce the leakage of resources from poor localities (Thake, 1995; Williams, 1996a, 1996b, 1996c). However, others argue that LETS schemes have limitations (Stott and Hodges, 1996):
Membership is not large. There were only 40,000 members in the UK in 1996. In 2004 LETSLINKUK was trying to update national membership figures, but had insufficient funds to undertake the necessary research.
The success of LETS depends on the level of activity of the members. It has been estimated that the average LETS member takes part in activities with a cash value of about £70 annually.
LETS tend to offer ‘quality of life’ services, rather than addressing basic needs. Consequently, LETS members are often perceived to be making a ‘lifestyle statement’. It has been estimated that the majority (70 per cent) of LETS members are already in employment and a similar proportion are committed to environmental issues.
In many cases, an informal economy already operates, albeit on an informal or even illegal basis, in many deprived communities.
LETS could be said to undermine the boundary between lay and professional expertise if people offer services such as computing support, childminding, electrical work and hairdressing, that others might charge for; and because appropriate skills and knowledge for some trades are important, it may be that certain goods and services will remain part of the mainstream cash economy.