John 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.
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 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.