The  sale of the Co-operative Bank

News of the sale of the Co-operative Bank was a shock to its customers. In the Guardian Patrick Collinson, ‘money editor’, summarised the situation: the Co-op Bank is the only UK high street bank with a customer-led ethical policy, covering a range of issues from the environment to animal welfare. 

The last article about the bank was top post last week, so its fortunes are evidently of interest to readers and visitors.


Collinson quotes James Daley of Fairer Finance; ”It has performed surprisingly well for its existing customers since its troubles a few years ago. Its customer satisfaction ratings have been improving, as has its complaints performance . . . it felt very much like it’s been in a time of recuperation and rebuilding. In the immediate future, I’d suggest that customers sit tight. As long as they’ve got no more than £85,000 with the bank, there’s no material risk to their money”

Liam Coleman, who joined after working for RBS and Nationwide and was part of the 2013 turnaround team, says that the number of current account holders has fallen from 1.5 million to 1.4 million but the number of mortgage customers has actually increased from 175,000 to 225,000. Investegate, whose text is legible but not reader friendly to non-subscribers, gives further useful information.

Engineer Shaun Fensom, who co-founded Poptel and is involved with several ethically based organisations, set up the Save Our Bank campaign. He wanted to make sure the bank kept its world-leading ethical policy and ultimately return to majority co-operative control. Within a few months over 10,000 bank customers had signed up to the campaign and many joined its  Customer Union for Ethical Banking.

As a customer of the Co-operative Bank and enthusiastic supporter of its values, he acknowledges there have been management failures and that it was “badly run and overstretched”. But he believes existing customers should stay and fight to maintain its principles: “We are saying that now, above all, is the time to join the customer union. We want to see the ethical policy stay in place because without it the bank will be doomed. It would be a commercial disaster to drop it. I certainly don’t want to move my account. I want it to be a successful, customer-led ethical bank.”

Fensom pointed out that, in the wake of its disastrous merger with Britannia building society and near financial collapse, the bank asked members about revising its ethical policy – and the response was that customers wanted a strengthening, not weakening, of its ethical stance.

Triodos Bank has the strongest green and ethical credentials among the rivals to Co-op Bank. Indeed in one respect it goes further, saying it will only lend to organisations “who put people and the planet before profits,” and publishes details of all its borrowers. This week it announced that its long-awaited UK current account will open for business on 26 April, but Triodos has no high street branches.

Stuart Coe, chief operating officer of umbrella group Co-operatives UK and a Co-operative Bank customer, believes that any buyer will have to maintain the values the bank has championed. Many customers would add that this is not only an ethical imperative, but its only hope for a viable  future.




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A Co-operative education system for a Co-operative Wales?

co-ops-and-mutuals-walesA new conference looking at the role of co-operative education and opportunities opened up by the Well-being of Future Generations (Wales) Act 2015 is being held in Cardiff on 8 April.   

Here is a report from Callum Johnston and David Smith, Secretary Co-ops and Mutuals Wales. 

Cabinet Secretary Mark Drakeford AM, at the launch of the Welsh Government-funded “Care to Co-operate” service in 2016, spoke of his vision of Wales as a Co-operative Country. It is a vision that is not just about the distant future.

Co-production, mutuality and social co-operation are now enshrined in Welsh legislation, with specific references in the Social Services and Wellbeing (Wales) Act, and a strong resonance in the Well-being of Future Generations (Wales) Act. This provides a great platform for a co-operative Wales, but as was recognized in 2016 by the government-backed Co-operatives and Mutuals Commission, there is a need for the values, principles and skills related to co-operation to be embedded throughout the education system.

Education is at the heart of co-operative principles, and co-operators in Wales are now seeking practical ways of keeping education at the core of developments for a more co-operative and sustainable Wales. In particular, Co-operatives and Mutuals Wales are looking at how co-operation can play a bigger role, not just in the school curriculum, but in higher education, adult education and informal community education. It is not looking for out-sourced developments as in England, but for more ‘co-operation’ both as a subject and as a style within the educational curriculum.

Education should be ‘cradle to grave’ and comprehensive: formal, informal, adult and community. Methods should be appropriate to Wales – widely varying population densities necessitate e-learning and clustering of services.

A strategic focus is essential on co-operative education if the benefits of co-operation are to be achieved and maintained in Wales. Now is a good time to build on the momentum for co-operation started by the Co-operatives and Mutuals Commission.

Our next event, A Co-operative education system for a Co-operative Wales? ‘will be a facilitated day working with Dr Sue Lyle, retired Head of Continuing Professional Development at Swansea, Metropolitan University. Speakers include: Dr Cilla Ross, Co-operative College, Professor David Reynolds, Swansea University School of Education and Kevin Pascoe, The Open University in Wales (personal capacity).

The outcomes will be collated and should go some way towards answering the questions:

  • Is there a need for Co-operative Education in Wales?
  • What would an ‘excellent‘ Co-operative Education system in Wales look like?
  • Can curriculum development and teacher training be given a co-operative nudge?
  • How can Co-operative Education engage communities and embrace adult learning?
  • What opportunities are opened up by the Future Generations Act?

Please come and join us.

Venue: Cartrefi Cymru Co-operative, Curran Road, Cardiff, CF10 9NB

Attendance: £10 payable in advance. Includes refreshments and report

For further details from Co-ops & Mutuals Wales email


We are now taking bookings. We only have 20 or so spaces, and early booking is strongly advised. Our programme/booking details can be found at   If you are unable to attend we welcome comments on questions posed for the day. You may have others!




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Architects Design Partnership employee ownership eclipses ‘Trumpton and Mayhem’ !

Architects Design Partnership (ADP), founded in 1965, now has a base in Birmingham’s Jewellery Quarter and studios in Delhi, London, Manchester, Newcastle, Glasgow, Edinburgh, Oxford and Sherborne.

adp1-2As the first step on the journey to becoming employee owned, LLP converted to ADP Architecture Ltd. It had adopted an employee ownership structure and the majority of the shares in the company, transferred to an Employee Owned Trust, will be held in trust for all of ADP’s employees giving them a genuine say in the direction of the practice.

Opting for indirect share ownership, which places shares into an Employee Ownership Trust, ensures employees have an immediate impact on the future running of the business, while provisions have been made to protect its long-term stability. Indirect share ownership also removes the need to buy back shares if an employee chooses to move on from the business.

David Heslop, managing director of ADP, who has overall responsibility for financial operation and business development, said: “Choosing a corporate form that improves employee engagement and retention and makes succession less of a problem is vital. For ADP, employee ownership was the obvious choice.”

adp2-meonstokeADP development in Meonstoke Hampshire

Gary Davie, head of employee ownership at ADP’s legal advisers Shakespeare Martineau, emphasises, “The key thing to bear in mind is that employee-owned businesses will still need a strong and effective management team to guide decision-making and this is why ADP has chosen to appoint an employee director to the management board.”

In his blog David Heslop writes: “October saw the biggest change of the year, eclipsing both Trumpton and Mayhem . . . So, collaborating with others, listening to the population, having foreign employees, providing good health and education facilities and getting employee representation on the board of companies are all possible whilst keeping everyone happy at the same time. What’s so difficult Mrs May?”




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The Co-operative Bank secures the Britannia Building Society’s pension scheme


Earlier this month, The Times reported that the Co-op Bank has agreed to pump millions into the pension scheme of the Britannia Building Society.

The Bank’s pension trustees will be given £50 million over the next seven years, as well as placing a £137 million portfolio of top-rated mortgages or debt into a custodian account with another bank as security for the scheme.

The pension scheme became the responsibility of the Co-op Bank after its merger in 2009 with the building society. The agreement follows months of negotiations between the two sides and is the result of an April 2014 triennial valuation of the fund’s assets and liabilities.

Co-op Bank’s pledge to provide £137million security to the pension fund highlights continuing fears over the scale of the deficit. As well as mortgage-backed securities, the lender can also put in government bonds and debt rated AAA as a guarantee.




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Political recognition and support needed for ecological land co-operatives


The Ecological Land Co-operative (ELC) is working to make land accessible for new entrants to small-scale ecological farming in England.

It has identified two key barriers for those who wish to live with the land – high land prices and planning consent – and now works to solve these issues by owning the freehold of each smallholding to protect it for agricultural use and keep it affordable. By buying larger sites for a lower price, the ELC has spread the cost of infrastructure, planning applications and ecological site monitoring across the smallholdings. The three smallholdings operate as independent businesses but work co-operatively to manage the sites and offer mutual support.

Shaun Chamberlin, when chair, wrote in depth here: and Cate Chapman, managing director, describes ELC’s vision “of a living, working countryside contributing to a bio-diverse environment, strong rural communities and a safe, just food system.”

elc2Volunteers at Steepholding farm, leased from the ELC at their Greenham Reach site [photo: Steepholding] [photo: Walter Lewis]

elc-bbcIn May 2015 Anna Hill visited Greenham Reach in Devon – more opposite – but the link tells us that this BBC programme is no longer available.

In 2016 James Sullivan reported in the Co-operative News that ELC raised money through a loan and community share offer to purchase an 18.5 acre field in East Sussex to continue carrying out its vision of developing small-scale, sustainable farms. The loan came from the A Team Foundation – an organisation founded to improve food access, quality, education, research and environmental stewardship through funding projects and charitable organisations.

Oli Rodker, executive director for the ELC, said: “We are delighted with the purchase of our new site in East Sussex. We can now get on with our plans to use this land for ecological farming where good food, conservation and ecology sit side by side – now and into the future.” Alongside the three at Greenham Reach, and the cluster at the new site in East Sussex, ELC aims to create 20 ecological smallholdings by 2020.


In order to present the work they do, as well as introduce some of the team, the ELC has also launched a short film featuring footage shot at the smallholdings.

Political support would be welcomed. There are precedents: in Wales, a “One Planet Development” policy was approved in 2010, making it easier for exceptionally eco-friendly land-based projects to secure planning permission. In France, last autumn a new law was passed committing to agroecology on 200,000 holdings by 2025, to training future farmers accordingly, and to the allocation of land to young farmers to help them get started . . .

Our lead came from Shaun Chamberlin, former Chair of the Ecological Land Co-operative, who has also been involved with the Transition Network since its inception, co-founding Transition Town Kingston and authoring the movement’s second book, The Transition Timeline (Green Books, 2009).




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Business Desk reports on Richard Pennycook’s CBI address

co-op-logoThe Co-operative Group has 2,800 local, convenience and medium-sized stores and other businesses: the UK’s number one funeral services provider, a major general insurer and a developing legal services business. It also has a minority shareholding in The Co-operative Bank and a joint-venture travel business with Thomas Cook.

The general public does not realise that there are also twentyone co-operative retail societies independent of the Group, listed on this informative Wikipedia website and indeed hundreds of worker co-operatives (some listed here).


The Business Desk reports that profits at the Co-op Group more than halved to £17m in the first six months of this year, as the group continues with its three-year plan to rebuild the business. The ‘latest bump in the road’ was news of a further 200 job cuts in Manchester and Stockport, which it said was due to continued low interest rates affecting its money-making potential.

_richard-pennycook-300pxSpeaking to an audience at the CBI North West annual dinner at The Point in Old Trafford, Manchester, the Group’s chief executive Richard Pennycook said the signs of what was to come for the Co-op were there before 2013, but no one listened until it was almost too late – just like the politicians who did not foresee Brexit or Trump’s victory. He said:

“A financial crisis was followed by a reputational crisis, when it was revealed that the chairman of the bank had been a layman with little knowledge of banking but a lot of knowledge of how to throw a party. These crises nearly killed the Coop, and did result in half the assets accumulated over 170 years being written off – a loss of £2.5bn. All the signs of impending crisis were there before the downgrade, but no-one internally was listening. Sir Christopher Kelly, who produced the independent report into what went wrong, called it ‘a failure of management and governance’.”

Earlier this year Mr Pennycook, whose pay ‘seems to be exceptionally high” as Jim Lee, a former secretary of the Scottish Co-operative party said, took a voluntary £500,000 pay cut. This was, perhaps, related to his request to reduce by 60% his salary and rewards package (said to be a total of £3.59m last year including an annual bonus of £1.12m).

Jim Lee suggested that – according to a tradition observed in some worker co-operatives today – executive pay should be limited to a multiple of that earned by the lowest-paid workers within the Co-op and that members should be given more say over remuneration.




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Social care system in crisis: the co-operative model offers a good way forward

“Our social care system is in urgent need of reform. Private companies profiteer, whilst older people, those who rely on social care and the staff that deliver it, pay the price. The market in social care services is broken – incentivising a race to the bottom on quality and workforce conditions, a lack of accountability, and de-personalisation of services.

taking-care-co-op“Shrinking budgets and increasing demand has meant tighter eligibility criteria. Hundreds of thousands fewer people are getting help, and there is a financial imperative for local authorities to commission services at the lowest price regardless of quality. All the while the numbers providing care informally to family and friends is growing . . .

“When frontline staff are squeezed by their employers, and owners seek higher returns on their investments, the quality of care falls. Domiciliary visits are shortened and high staff turnover undermines the relationship between the care workers and service users”. Extracts from Taking Care: a co-operative vision for social care in England, written by James Scott and published by the Co-operative Party in September.

The report concludes: By sharing knowledge of how to build and maintain co-operatives, focusing on the development of micro, community-led co-operatives, and celebrating fully cooperative providers with an accreditation system, the wider co-operative movement can play a significant role in overcoming the care crisis in England today. 

The Taking Care analysis finds that the shift to private provision of care has reduced the quality of care, undermined labour market conditions and reduced cost efficiency within the sector. The report argues that improving the adult social care requires the establishment and promotion of social care co-operatives . . . and cites Community Lives Consortium (CLC).

clc-logoThe Welsh government wants to foster initiatives like CLC under a three-year programme, Care to Co-operate, which aims to develop the role of co-operatives and social enterprises in the care system. Run by the Wales Co-Op Training and Development Centre, it reflects growing interest in the potential of not-for-profit care co-operatives.

David Brindle’s Guardian article describes CLC as “a not-for-profit social enterprise that uses co-operative principles in its decision-making and management”. It supports 300 people with care needs, most of whom have learning disabilities; they are treated as partners in the way it operates.

According to the Co-ops UK network, there are 88 co-operatives in the UK delivering adult social care, with a combined annual turnover of almost £100m. Only 33 of these are in England, however, where they represent less than 1% of the total market.


Care and Share Associates (Casa), which provides homecare across the north of England, was set up in 2004 but grew out of Sunderland Home Care Associates (SHCA), which in turn came from Sunderlandia, a pioneering building co-operative set up in 1973. One of Casa’s founders, Margaret Elliott, Casa, which is based in Newcastle upon Tyne, SHCA has remained separate and continues to operate successfully. But Casa has grown from scratch to employ more than 850 people, who are also its owners; it provides 20,000 hours of care a week in the north-east, north-west and Leeds and has an annual turnover of £14m.

cherylThe co-op sets recruits from, and invests in, low-income communities and has a strong track record of helping people break out of long-term unemployment, Training is provided by the Casa Academy and employees are guaranteed a minimum 16 hours’ work a week, holiday and sick pay and, after six months’ probation, a profit share. At the October meeting of Co-operatives West Midlands this case for ‘Fair Care’ was ably and eloquently made by community worker Cheryl Barrett, founder of Change AGEnts (right). 

The co-operative advantage: there is not much profit in the care market at the moment: “We’re hardly making anything currently,” Guy Turnbull, Casa’s managing director and co-founder admits, “but because we don’t have external shareholders, and we’re backed by [social investor] Big Issue Invest, we don’t have to make a 10% return like others do.”

The Co-op Party report concludes that a new model of care is needed, one that uses the principles of co-operation to build upon the first-hand knowledge of those who rely, receive and provide care: 

“Care recipients, their families, and care workers know how to create a care system that will deliver consistently high quality care. They should be allowed to lead the care sector”.




Posted in Co-operative movement, Co-operatives UK, Democratic participation, Education, Employee ownership, Worker co-operatives | Tagged , , , , , , | 1 Comment