Labour’s first conference since forming government drew a hopeful contingent of co-operative delegates, who are keen to see it deliver on its manifesto pledge to double the size of the co-operative and mutual economy.
In his speech, prime minister Keir Starmer made no direct mention of the sector but, after reiterating his priorities of stabilising the economy and ‘fixing the foundations‘, he promised to build a Britain that “belongs to the people“.
Britain, he argued, no longer offered working class children better prospects than those of their parents. To address this, he promised to “build a new Britain from the spirit of ambition and enterprise”.
He announced a range of measures, including a “homes for heroes” scheme for veterans in housing need; additional housing for victims of domestic abuse; and a rocket booster plan for housebuilding in cities with planning passports due to be introduced. It remains to be seen whether the latter will benefit housing co-ops.
He promised to give businesses the flexibility to unlock training needs, to create new foundation apprenticeships to tackle youth unemployment, and investment in skills development to reduce the reliance of some sectors on overseas workers. He also promised his party would deliver “the biggest levelling up for workers’ rights in a generation”.
“If you want a country with more control, if you want the great forces that affect your community to be better managed – whether that’s migration, climate change, law and order, or security at work – then that does need more decisive government, and that is a Labour government,” he said.
Despite pledging to build a Britain that belongs to the people, Starmer did not mention co-ops, mutuals, or community benefit societies.
Nevertheless, the conference was a good opportunity to discuss how the Labour government can make good on its promise to double the size of the co-operative and mutual economy.
Community ownership
A fringe event organised by the Co-op Party discussed research by the Institute for Public Policy Research North, which shows £15bn in local community assets have been sold since 2010, something Party chair Jim McMahon attributes to austerity measures.
“All the things that used to be there that we took for granted are no longer there,” he said. “We need to fix the foundations, how the money is spent within the system.”
One problem, he added, is that councils often end up competing for funding.
Another change that would help boost community ownership is having business rates that reflect the community value of a business, he argued.
Related: Co-op sector’s dismay as Europe mandate fails to mention social economy
Sarah Longlands, CEO of the Centre for Local Economic Strategy (Cles) said community and social organisations should have the chance to tender for procurement from anchor institutions including councils, universities and hospitals. This would support the development of the sector, she said.
Ailbhe McNabola, deputy CEO, Power to Change, said community businesses lead to strong and resilient economies, but face many barriers, including inadequate legislation. While the community right to bid in England, introduced in the Localism Act 2011, was a good first step, she warned that it is not fit for purpose. Communities should also have the right to first refusal, as in Scotland, and be given longer than six months to raise funding and develop a business plan to bid for assets, she argued.
McNabola thinks the definition of community value places should also be expanded, and communities looking to buy community assets should benefit from free advice from their local councils.
Offering examples of barriers facing the sector, Deana Bamford, a community organiser and member of community benefit society Coalville C.A.N., described her team’s struggle to acquire a high street building to use as a community space, from securing finance to working with developers. Despite this, she encourages delegates to find their local community benefit society or create one themselves.
Speaking with a single voice
The conference also saw a fringe session from the Future Economy Alliance, which offers a platform for co-ops, mutuals, social enterprises, charities, and employee-owned businesses to speak with a single voice.
Baroness Thornton, a patron of Social Enterprise UK, said the alliance is “trying to shift ourselves from the margin to being a central part of the growth mission of the economy” – and claimed the Labour government is prepared to support this agenda.
Co-operatives UK’s policy and development lead, James Wright, said the alliance is bringing different actors together to persuade the government and those responsible for economic policy their models have a distinctive contribution and value.
“We need to be at the core of economic thinking, not the periphery,” agreed James de le Vingne, CEO of the Employee Ownership Association.
One factor stifling progress is having different parts of the co-op and mutual economy controlled by different government departments. Co-ops and mutuals are looked after by the Treasury, employee-owned businesses fall under the Department of Business, and civil society organisations are supported by the Office for Civil Society within the Department for Digital, Culture, Media, and Sport. TPanellists agreed that the Department of Business should look after co-ops and mutuals.
Other issues mentioned included the lack of awareness about different business models among business support providers and the need for the British Business Bank to cater to these models.
The issue of public procurement cropped up again during the session, with Jennifer Bird from Signalise co-op, which provided BSL services at the conference, arguing that the Social Values Act needs to be reviewed. “We are ready, we want to scale,” she added. “We can deliver huge amounts of value to our communities.”
Ahead of the conference, Co-operatives UK published its annual Co-operative and Mutual Economy report, which sets a benchmark for the government in terms of doubling the size of the co-operative and mutual economy.
“The reason we backed the Future Economy Alliance is because we need to stop the rhetoric around the social economy, it’s all the economy and what we need to do is be integrated into it and not be a silo. It needs to be the thinking of all government departments,” said Co-operatives UK’s CEO, Rose Marley.
Doubling the size of the co-op and mutual economy
Another session by the Social Market Foundation, Nationwide Building Society and Royal London explored what the government can do to double the size of the co-operative and mutual economy with Lord Kennedy arguing the target is achievable.
“It’s wonderful that the Labour government has stated the intention to double the side of the [co-op and mutual] economy,” said Co-op Group CEO Shirine Khoury-Haq, adding that the retailer is ready to work with the government to explore what societal needs can be met through co-op models.
“When the system is right, you can really provide for society”, she added, noting that in the US 12% of the population gets energy from rural electric co-ops. Similarly, in Italy, 13% of care is provided by co-ops. Khoury-Haq thinks tax incentives can play a crucial role in growing the sector.
The Co-op Group will continue to campaign for government action on business rates as well as shoplifting and attacks on store workers, she said.
Emily Darlington, MP for Milton Keynes Central, agreed that co-ops and mutuals can provide solutions to societal problems, adding that it is the sector’s job to figure out where the excitement is and what can be created.
One way the government can help grow the co-op and mutual economy is by updating legislation, said Nationwide and Royal London’s chair, Kevin Parry – but, he warned, when legislation is renewed policy makers usually consider the needs of companies first.
“Our job is to remind ministers and civil servants that not everybody is a limited company,” he said.
Barriers highlighted by panellists included co-ops and mutuals facing a higher paperwork burden, which, in turn, leads to a misconception that they are riskier; the lack of understanding of what co-ops and mutuals are; and the sector’s failure to speak with a single voice.
“If co-ops don’t speak with one voice, it will be difficult to get legislative changes,” warned Kennedy.
Co-ops driving social mobility
A session by Demos and the Co-op Group looked at how businesses, including co-ops and mutuals, can harness social mobility to drive growth.
Miriam Levin, director of participatory programmes at Demos, explained that businesses can improve recruitment processes, provide clear progression routes, or have initiatives that boost diversity in the workplace, all of which would help drive social mobility.
“Co-ops are about people, social mobility is about people and people are at the heart of the co-op model,” said Emma Hodinott, deputy secretary general of the Co-op Party. The Party, she argued, is ready to join with the wider co-op movement to play its part in doubling the size of the co-operative and mutual economy. She added that communities, businesses and the state can collaborate to address unemployment.
Related: Co-op Group launches campaign to mark National Inclusion Week
Panellists also mentioned the importance of gathering data around social mobility, with former secretary of state for health and social care, Alan Milburn, arguing that hard power is motivated by what data reveals.
Stephen Bediakp, a social entrepreneur who helped found a co-op for low-wage workers in San Francisco, said government funding can help entrepreneurs get their businesses off the ground. An example is the Pathway Fund, which offers Black and Ethnic Minority-led organisations better access to finance.
Paul Gerrard, campaigns and public affairs director at the Group, said businesses valuing diversity tend to perform better. The Group is working on different strands to drive social mobility, including its Co-op Levy Share, which supports apprenticeships in environmental consultancy, engineering, healthcare, education, legal practice, HR, and emergency services. Over £25m has been pledged by 80 organisations to the Co-op Levy Share so far.
Another initiative is the Bright Future programme, through which the Group, as well as other retail co-ops, offers the opportunity of a paid work placement and a job in our food business to modern slavery victims.
Gerrard also talked about the scale of the co-operative movement worldwide.
“Let’s not pretend that this is something weird. In the world, there are three million co-ops. The revenues of [the top 300] co-op businesses in the world are US$2.4tn. This isn’t just something that a few people do on a Sunday morning. This is mainstream business models,” he said.
Over the three days, co-operative, mutual, and credit union representatives were actively involved in fringe events alongside government representatives, with the Labour government under pressure to deliver on its promise to double the size of the co-operative economy.
And while the conference helped to point out some of the barriers co-ops face, there are many lessons to learn from abroad as well. France, a country with a similar GDP and population as the UK has over 22,000 co-ops, more than three times the number of co-ops the UK does. The UK has a long way to go but at the Labour conference, the movement voiced optimism about the future.
