Trugs? What a sterling idea: Forget Norman Lamont's embattled economy - you can set up your own, writes Imogen Edwards-Jones

DEEP in the heart of East Sussex, in the small market town of Lewes, they could not care less about the contents of Norman Lamont's red box, the collapse of the pound, VAT, or the goings on in London's Square Mile. They're much too preoccupied with trugs.

'It's an old Sussex word for basket,' explains Johnny Denis, 31, who is sitting beside a stripped pine table with a silver cafetiere filled with freshly made coffee, attempting to quieten Ella, his 11-month-old daughter. 'We decided on the name after the exchange rate mechanism and, you know, the basket of currencies.'

Trugs are used as currency in a Lets scheme, or Local Exchange Trading System, which is based on the principle of bartering. They are paid at the rate of 12 an hour for activities ranging from baby-sitting to pot-throwing. Members of the scheme exchange favours or their expertise for photocopied cheques drawn on a central bank based in one of the member's homes. 'Everyone is paid for an hour of effort,' Mr Denis says. 'It's a way of escaping the sterling economy.'

Mr Denis, a part-time computer systems manager, and Jo Lane, 25, an unemployed Youth Training Scheme and special needs trainer, started up the group about 18 months ago when they realised they were chasing the same jobs advertised in their evening paper. 'It started on a 'what if we all club together' basis. After a few teething problems, we have over 30 members and membership is doubling every couple of months,' says Ms Lane, talking over the screams of 14-month-old Daisy.

In the wake of the recession similar schemes have surfaced all over the country, with 42 already up and running and plans for another 40 mooted. They pay strouds in Stroud, brights in Brighton, olivers in Bath, cockles in Exmouth, bobbins in Manchester and kreds in Leamington Spa. 'The scheme allows you to purchase things that you could not afford,' Ms Lane says.

'It's a person that you know providing a service that you want,' Mr Denis says. 'It's those little luxuries like a hand-knitted jumper. For example, I'm getting a ceramic sculpture for 100 trugs, something that you could never buy.'

'I've been spending trugs willy-nilly at the moment,' Ms Lane says. 'I have just had my garden done up. But I went planting 600 trees for trugs, and I am paid for administering the scheme, so I'm in credit.'

Paul Rideout, 32, a part-time special education needs assistant, is not so fortunate: 'I'm 40 trugs in debt at the moment, but that's because I have been quite inactive for a while.' He is hoping that someone will soon have need of his circus performing, vegan cake-making or gardening skills.

Rob Barrs, 26, who has a degree in geophysics but is unemployed, slumps against a table and sips coffee. 'The whole thing is planned on trust and goodwill,' he says, running his hands through his hair. 'Paul's in debt because he's only just joined the scheme. You hope that people won't go around abusing the scheme, but you can't make the rules against that. As soon as you make rules then people just go around breaking them. You have to make them feel part of the community.'

There was one person who wanted to leave the scheme while still in debt. 'But we solved that,' Mr Denis says hastily. 'They house-sat for someone while they went on holiday and paid off their debt that way.'

The biggest dilemma the group has faced has been whether to link its currency to sterling. 'We decided not to link, particularly after we heard about a group that was asked to pay tax by the Inland Revenue - they immediately devalued their currency so it was worth nothing. That's the joy of trugs - maybe Norman Lamont should try them,' Mr Denis says.

'There are a lot of people who think that we're just a load of woolly jumpers with attitudes. But I'm very active in the Green Party, and I can assure you we are a lot more interesting than the Lib Dems.'

Some schemes offer such a wide range of goods and services that members can survive without ever having to take part the 'real' economy, but the Lewes scheme is not so advanced. 'We lack the basics,' Mr Barrs says. 'Like a plumber and someone with an organic food farm,' Ms Lane adds.

'We do have a food supplier who only charges his handling fees in trugs. We need a bit of money. I did offer my services to the council for three days in their housing benefit office for my poll tax,' she says. 'But they weren't interested.'