Chancellor Jeremy Hunt announced his spring budget last week, drawing criticism from co-op sector representatives wanting more measures to support the sector.
The budget, which saw Hunt attempt to stimulate growth as an embattled government ponders its options for an general election date, was based around a headline announcement of a 2p cut in National Insurance.
But it did have some measures of benefit for the co-op sector, which were welcomed by Co-operatives UK.
“We’re excited to see £20m going into a social finance fund for community-led housing,” the apex said on X. “Co-operative and community models can fix broken housing markets.”
There is “massive potential to raise millions via community shares to make this happen”, added Co-operatives UK. “This fund needs to tap into that.”
The Confederation of Co-operative Housing also noted this announcement, with CEO Blase Lambert saying: “CCH welcomes the £20m announced in the budget for investment in community led housing projects.”
Co-operatives UK also welcomed the £15m for culture and heritage investment projects in the West Midlands – a sector that has come under threat in the wake of the cash crisis at Birmingham City Council.
“Through our work in the region, including our new Ownership Hub, we know much is under threat,” said Co-operatives UK. “Creatives are looking for ways to control their destiny. This money should be used to help them do it.”
Related: West Midlands Ownership Hub to launch in May
The freeze on beer duty will help the community pub sector, it added, while the scrapping of non-dom tax status, is good news for the fair tax movement. “As organisations that pay their way, co-ops need to see more action on loopholes/tax avoidance. As we share wealth and power, co-ops offer ways to create wealth from the bottom up, with less reliance on flighty overseas money.”
But it warned that the new ISA, designed to incentivise investment in UK businesses by giving people an additional £5k tax-free allowance to invest in UK assets, on top of the existing £20k limit, “should operate in a way that incentivises investment in UK co-operatives”.
Co-op Party policy officer Daniel Monaghan was more damning in his assessment. “Once again, the government’s budget has completely failed to mention co-operatives or mutuals,” he said, “despite them contributing over £87.9bn to the UK economy per annum and sustaining almost half a million jobs. Since the Conservatives entered government in 2010, co-operatives have only been mentioned four times in the proceeding 17 budgets.”
Like Co-operatives UK, he welcomed “recognition of the importance of community-led approaches to housing and regeneration”, but warned: “The £20m announced for community-led housing is too small to enabling the scaling up of community land trusts across Britain – which would deliver affordable housing for the long-term benefit of communities.”
Monaghan said the Party “is pleased to see our campaigning for the extension of the Household Support Fund has led to its renewal until September. The Household Support Fund has been a vital lifeline for families struggling to make ends meet and we will continue to campaign for its extension and maintenance beyond autumn.”
He said a Labour & Co-operative government “is desperately needed to raise living standards, create new community-led affordable housing and unleash the growth of the co-operative and mutual sector across the country”.
Tim Davies-Pugh, CEO of Power to Change, said there was not enough support for community businesses.
“We’re hearing time and time again from community businesses that are still grappling with the impact of rising costs and demands on their services. Instead of focusing on tax cuts for individuals, government should invest in community business.
“The announcements on community-led regeneration and development are positive, but investment should be broader and deeper, involving and backing community business. The public supports this idea, with 46% of a representative sample recently polled prioritising increased spending on services and facilities run by the local community or local authority, over tax cuts for individuals.”
Locality CEO Tony Armstrong added: “With electoral politics taking centre stage, this budget has ignored the elephant in the room. Mounting pressure on councils to cut services and sell assets just means local people are paying the cost. From Birmingham to Bristol, Nottingham to Thurrock, council cuts mean that charities and community organisations are struggling to keep vital local spaces and services alive.
“It’s clear that a more sustainable long-term funding settlement for local government is needed. On that the chancellor remained silent. The government needs to act now to stop the loss of key services and spaces which have been vital in holding communities together. Local people should not bear the brunt of council’s financial problems.
“But ultimately, we have to move away from short term funding crises to create a longer term shift of power. That’s why in our manifesto we’re calling for radical reforms that put power firmly in community hands. That includes decision making powers for local people so that communities themselves can take charge of the things which are important to them.”
