Ten years ago co-operators anticipated the 2013 crisis but their misgivings were not heeded . . .

This website was inspired by the truthful and trenchant remarks of readers in the Letters pages of the Co-operative News. A few found in the 2005 database are recorded below.

Ron Hunter writing from Sussex reminded readers succinctly that “Democratic control must not be treated as an optional extra”.

Vic Parks, chair of the Group’s Surrey and Berks Area Committee, writing in a personal capacity, said that the overarching strategic aim should be to keep alive the aims and ambitions fought for by previous co-operators – so convincing others that there is a real alternative.  Staff members at all levels should genuinely embrace co-operative ideology and “walk the talk”. Savage cuts had been imposed upon committees in a cavalier and undemocratic manner, without taking into account the fact that ordinary members, rather than management, own the society . . .

A self-perpetuating lucrative sinecure for an under-achieving hierarchy

Philip Rapier, a member of the Group’s South Wales Regional Committee, also writing in a personal capacity said that the decline of the movement’s democratic heritage must be stopped by changing the status quo, which is a vehicle for creating a self-perpetuating lucrative sinecure for an under-achieving hierarchy. These people are well represented on the Remuneration Committee, which has awarded them excessive pay and pensions, comparable to those earned by industrialists who built their own businesses, often risking everything they had, including their own homes.

M.D Mathieson questioned the whole concept of the Co-operative Group as it now exists: The Co-operative Group now operates on such a scale that it has lost an important co-operative asset, a sense of belonging to a community . . . the individual members do not vote for Board members, do not have a vote on the annual report and accounts and cannot attend the AGM. Representatives elected by an obscure transferable vote system do all this for them.

Former Midlands Society Chief Executive and Co-op Group director Willie Tucker said he passionately believed in the co-operative model, which was as relevant today as it was over 100 years ago. At a retirement meeting, 120 col­leagues, friends and family includ­ing Government Minister Margaret Beckett, heard him say: “There are still too many exam­ples of individuals – sometimes at the highest levels – who are using the Movement for their own personal convenience having lost sight (if indeed they ever had sight) of what exactly it is we are trying to achieve through co-operation”.

Lincoln Co-op director and former Congress President Alan Middleton echoed Mr Tucker’s concerns in a letter in the September issue of the Co-operative News, saying that the movement is “over-dominated” by paid officers: Readers need to be quite clear, there are still officials around – employ­ees of the Movement – who will not rest until the voice of the lay member has been completely silenced”.

“A flawed culture and a system of governance which led to serious failures of oversight”

The findings of Sir Christopher Kelly, appointed by the Co-operative Group to review the bank’s failure, will be reinforced next week, by two warning voices with less familiar names – member commentators – recording and appraising the current actions of the co-operative group, which is often mistaken for the whole movement by the general public.

 

 

 

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Failing housing market – a co-operative solution?

Update

In June the Co-operative News informed readers that the UK Co-operative Economy 2016 report records – in eye-catching graphics – that around 17.5 million people are now owners of the country’s 7,000 independent co-op organisations – up from 17.4 million the previous year, and showing an increase of 1.3 million over the past five years. The report, published by Co-operatives UK, finds that the sector supports 223,000 jobs and is worth £34bn a year to the economy, showing resilience in the midst of wider economic uncertainty. Despite a slight dip on last year’s figures, the sector has seen a £3.5bn (or 10%) increase in turnover during the last five years.

 Rochdale co-op housingBH-3

An earlier article in the News recorded the finding of the 2004 official review of housing supply, that Britain needed to build 250,000 houses a year and a couple of questions were asked at the annual conference of the Confederation of Co-operative Housing (CCH), Loughborough University:

  • Can co-operative housing help solve Britain’s housing crisis?
  • And, if so, what can be done to encourage the development of more housing co-ops?

Claire McCarthy, general secretary of the Co-operative Party, gave the example of Wales, where the previous Labour government legislated to enable mutual housing associations to grant assured tenancies:

methyr valley homes logo“New build co-operative housing schemes have been completed which are not only providing affordable rents for local families but have also provided high quality apprenticeship opportunities and training for tenants in managing their homes within a co-operative structure. “In addition, Merthyr Valley Homes has become the largest housing mutual in Wales and only the second mutual housing association (the other is Rochdale Boroughwide Housing – above centre) to be owned by both residents and staff.  Recent developments, particularly in student housing co-ops, are also providing inspiration for what is possible . . .

“Government ministers have re-stated their commitment to co-operative housing and committed to examining the progress in Wales to see if lessons can be learned in England. This provides us with a good opportunity for the future . . .

“Challenging failing markets is what co-operation is all about. Our housing market is failing a growing number of people and we can and must be part of the solution,” she concluded.

 

 

 

 

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Labour leader Jeremy Corbyn welcomes profit-sharing and employee-ownership

prem sikka 3Prem Sikka, Professor of Accounting at Essex Business School’s Centre for Global Accountability, opened a recent article by reflecting that corporations, such as BHS, are being run entirely in the interests of executives and shareholders, with little concern for anyone else.

Moving away from this model, Labour MP Gareth Thomas, with the support of the Co-operative Party put forward a bill, Profit-sharing and Company Governance (Employees Participation), which proposed to make businesses with 50 or more employees set aside at least 5% of their total profits for staff. Labour leader Jeremy Corbyn was said to have supported the proposal. Read more here.

eo4 uk graphichttp://employeeownership.co.uk/resources/reports/

Visitors to this site sometimes open the worker co-operatives directory which has a few instances of co-ops financed by employee buyouts. On rare occasions, notably the company now known as the Scott Bader Commonwealth, the owner has given the company to its workers. Read more here. The work of the Baxi Partnership should also be mentioned.

chelsea green2

Earlier this month, a web search, following news from a colleague who has become Chelsea Green Publishing’s Commissioning Editor for the UK/Europe, led to the news that in 2012 Chelsea Green decided to become an employee-owned company, creating an employee stock ownership plan (ESOP) in which employees control 78% of the company’s privately held stock; the remaining stock is held by the founders.

In 2014 the owners of Outlandish, based in Finsbury Park, gave up their ‘fat cat bonuses’ by giving the business to their employees. The company, which builds next-generation data tools websites for organisations like the BBC and King’s College London, now has an annual turnover of £1million. Co-founder Tamlyn Rhodes said: “Like most knowledge-based companies the value of Outlandish is the people that work for it, not the machines that it owns. If people are creating the value through their hard work and ingenuity, it’s only right that they should get to own what they create.”

Speaking at the re-launch of Outlandish as an employee-owned company Jeremy Corbyn, as MP for Islington North, said: “I welcome and applaud this great local effort to create fulfilling jobs and provide training in Islington and hope that Outlandish’s model can be replicated in many areas.”

Note that on the Political Concern website Professor Sikka argues that the possible demise of retailer BHS draws attention to the need to change the way major corporations are governed.

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Save Our Bank – 2

save2 our bank header

An update from Save Our Bank, building on the December post.

As the Ethical Consumer website says, “The aim of the Save Our Bank campaign is to keep the Co-op Bank ethical and return it to mutual ownership at the earliest possible opportunity”.

The Save Our Bank declaration on The Co-operative Bank’s Ethical Policy has been signed by fifteen organisations listed on the Amnesty website. Amnesty is a significant and long-standing customer of the bank, and has spoken out in support of the bank’s human rights leadership on a number of occasions. It is lending its weight (both moral and commercial) to the campaign to challenge these account closures. See Amnesty’s AGM page for more details.

At the annual general meeting of Amnesty International UK, with 88% in favour, a resolution was passed challenging the decision by the Co-op Bank to close the accounts of human rights organisations, including the Palestine Solidarity Campaign and others.

Since the bank said in December that it was pausing account closures, there has been no report of further campaign groups having their accounts closed. The organisations affected are listed on the website and a close watch is being kept on the situation; supporters are asked to inform Save Our Bank if they hear of actual or proposed closures of any other legitimate campaigning, aid or support organisations at info@saveourbank.coop.

It would be helpful to learn about any organisations that have not been asked to move – but that information would not be published.

We repeat the words of campaigner Shaun Fensom who said: “We believe ownership matters. Co-ops are a better, fairer and more democratic way of doing business. Along with most of our supporters, I want to see the Co-op Bank as a true co-operative, owned by its customers and employees.”


If you sign up to this campaign collective power can be used to influence what is going on. Already thousands have signed and the more there are, the more this voice will be heard.

 

 

 

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John McDonnell MP: build an entrepreneurial state at a local level – help to create fairer and more prosperous local economies

jmcdonnellJohn McDonnell MP, Labour’s Shadow Chancellor, speaking at the TAS Partnership, an employee owned transport company, described Preston council as a model of an innovative local Labour administration starting to think and act creatively to secure sustainable economic growth.

Preston council has provided help and support to retiring business owners, making sure viable businesses can stay locally owned. He spoke of the ‘axe’ which has fallen on local authorities: the richest 10% of councils have seen their funding cut by £28 per person since 2010, bBut the poorest 10% have seen their funding fall by £228.

The hands-off approach is leading to the collapse of Britain’s steel industry, even whilst Germany and the US to help theirs

The next Labour government intends to deliver real investment, across the whole country, in vital infrastructure, science and technology.

The priority for progressives now must be the distribution of ownership of wealth and assets, not only the distribution of income

Workers threatened with closure or takeover should have first refusal on buying out and running their place of work. With two-thirds of Britain’s family businesses at risk of closure when their owners retire, employee ownership can help solve a looming succession crisis.

eo4 uk graphic Research by the Employee Ownership Association (EOA) and the White Rose Centre for Employee Ownership

The evidence suggests that co-operatives are more resilient than conventional businesses

Twice as many co-operatives survive the first five years as other businesses and have a clear productivity advantage over conventional businesses. The UK’s co-operative sector is currently worth £37bn, just 20% of the size of Germany’s. But it’s grown by 15% since 2010 – faster than the rest of the economy. And fifteen million people now own a share in a co-operative,16% more than in 2010.

The next Labour government will work with the co-operative movement to double the size of the co-operative economy – a £40bn boost. It would introduce legislation to assist the formation of mutual guarantee societies, mobilising funds for small businesses by enabling them to club together to raise credit.

community energy network logoCommunity ownership of energy (more here), which Jeremy Corbyn and shadow energy secretary, Lisa Nandy have highlighted as a priority, has boomed in the last five years. Turnover has risen by 1,400%, as local communities realise the value of community ownership in both providing a revenue stream, and helping the move towards a low-carbon future. Yet this government has cut support for renewable energy suppliers, and removed incentives for communities to invest.

With the rise of precarious employment, co-operatives have a clear role to play. In an excellent paper by Co-operatives UK, published this month, the-self-employed-precariat-combine made the case very convincingly. By sharing the costs of administration, co-operatives set up to support the self-employed and micro businesses can play a vital role.

Co-operatives and new ways of owning and managing society’s wealth are an essential part of Labour’s vision for a better, fairer economy, and Preston is starting to lead the way.

The full address may be read here.

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Manchester’s worker co-operatives

Some time ago,  Paul Gosling wrote an article in the Co-operative News citing the Village Greens Co-operative as one of the new start co-operatives in keeping with the spirit of the Rochdale Pioneers:

village greens logo“The most obvious parallel with the initial founding enterprise of the co-operative movement can be felt, I think, in the Village Greens Co-operative in Prestwich in Greater Manchester. It is one of the youngest and most impressive co-operatives, with a shop that is strikingly clean, with a modern decor and a strong stock range of wholefoods, fruit, vegetables, drinks and organic meats. It is structured as a consumer co-operative, which has more than 400 investing members as well as two full-time workers, four part-timers and six casual staff”.

“Founder member Rachel Getliffe explains: “[It is] one member one vote, members can have a real say in shaping the shop, how we operate and how the profits are spent, they can receive an interest rate or dividends when we are in profit. This is here for our community because they wanted it and gave us their support – we had the idea, but we couldn’t have done it without them.”

village greens personnelVillage Greens’ details were added to the other worker co-operatives listed in the directory on this website.The following nine Manchester entries were found there, in addition to four more high-profile, long-established worker co-ops in the city:

Tree Station, Greater Manchester, provides a range of wood-related services  http://www.treestation.co.uk

Build for Change, steel and wood products, Manchester, 0161 227 9787

Stitched Up, repairing clothes, reclaiming and reusing fabrics, Manchester,http://www.stitchedup.coopstitchedupuk@gmail.com

Green Gold Diesel, biodiesel filling station, Manchester 0845 373 2769

Bicycle Doctor, sales , Manchester, 0161 224 1303

Limited Resources, delivering fresh organic food, Manchester area, 0161 226 4777

Eighth Day, vegetarian co-op, Manchester, 0161 273 4878

Accessible Acupuncture, low cost treatment, Manchester, 07590 903714

Work for Change, letting/managing work-space, Manchester, 0161 226 7696

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A report on new economic strategies for Wales offers useful leads for England

conaty 2016 coverIn 2015, the Wales Co-operative Centre and Co-operatives UK asked Pat Conaty to report on the social and co-operative economy innovation in Wales and to set this in a policy context, as uneven growth and imbalanced recovery from the downturn persists across the UK.

Conaty has united the report of community economic development practice recorded in the Localising Prosperity report by Localise West Midlands, and also LWM’s ‘follow on’ work, with the less understood Solidarity Economy thinking and practice common in France, Spain, Italy, Portugal and Greece. He also refers to Quebec and parts of the USA, where Solidarity Economy concepts have been aligned and blended with community economic development practices, sometimes described as a Collaborative Economy strategy.

Conaty advances the case for community economic development methods (including community land trusts, community development finance and community reinvestment) as the the first strand of a Collaborative Economy strategy for Wales.

His report considers evidence about how a collaborative economy model could provide concrete and practical guidance to regions who need a fundamentally new revival strategy.

Conaty points out that references to the growth spike of about 2% annually over the past two years can be misleading, because Greater London has been experiencing a boom whilst other regions, particularly in the north of England and Wales, have not.

Observing that when times get hard, mutuality stages a revival and commonly fills the gaps where competition and markets have failed, Conaty cites the growth of the new sharing economy that includes innovation in peer to peer lending, crowd funding, the far less publicised expansion of the co-operative economy in the wake of the banking crash and has outperformed the UK economy. He adds that over half the jobs in the UK are today provided by small and medium enterprises, of which 15% are social enterprises.

The social economy

co-op advantage coverMany European countries have been more successful since the 1970s in expanding the contribution of co-operatives and mutuals to their national economies. While co-operative businesses account for 2% of Gross Domestic Product (GDP) in the UK, they account for 8% in Germany, 10% in Italy and between 12% and 19% of GDP in Scandinavian countries (see The Co-operative Advantage).

Over time, collaboration has been fostered between social enterprises, co–operatives and the public sector, presenting a model of public social partnerships. These methods and most of the institutional forms of innovation are emerging in Wales and this report considers how these practices can be further developed.

The solidarity economy

The solidarity economy currently accounts for in between 5% to 11.5% of different labour markets across Europe, spreading from Italy to France, Belgium, Holland and Sweden where the share of the national labour force ranges from 9% to 11.5%. Read more here. It includes a broader range of organisations than the social economy such as:

  • Worker co-operatives, reclaimed factories, co-working and social enterprises
  • Community and co-operative energy and the mutualisation of utilities
  • Organic farming, slow food and local production chains
  • The Commons movement, zero waste citizens networks and Transition Towns
  • Social banks, mutual and sustainable finance and local currency
  • Co-housing, home exchanges and community self-build
  • Fair trade networks both in the southern and increasingly the northern hemispheres as austerity deepens
  • Shared transport and co-operative or mutual public transport.

Conaty endorses the idea of a public investment bank for Wales but cautions: “this is no magic answer without addressing the supply chain and working to set up the enabling policy framework to support the transition to a new economy that is grounded in the ‘fair’ and equitable provision of services to meet citizen needs”.

conaty crewProfessor of Accounting and Political Economy Karel Williams makes the case for a proactive role by local authorities to develop localised supply chains and patterns of employment. Moreover, Adamson and Lang, writing on the CREW website show that such a strategy could jointly tackle fuel and food poverty, create employment and address climate change.

Crew, Regeneration Wales, has been established to promote integrated regeneration throughout Wales by sharing experience, good practice and regeneration skills across all the professions that contribute to the regeneration process. CREW sees housing repair, low-carbon improvement measures and new construction as promoting local economic development and securing economic, social, cultural and environmental sustainability by 2030.

The report may be read here: http://www.walescooperative.org/wp-content/uploads/2015/11/A-Collaborative-Economy-for-the-Common-Good.pdf

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