Chancellor Rachel Reeves has set out a number of economic policies in her first Mansion House speech – including the announcement of a new industry-led Mutual and Co-operative Business Council.
Sector players represented on the council will include the sector apex Co-operatives UK, the Co-op Group, insurer Royal London, dairy co-op Arla, and Nationwide Building Society.
The move is part of the government’s manifesto commitment to doubling the size of the co-op and mutuals sector, recognising its “invaluable role … in driving inclusive growth across the UK”.
Alongside pledges to reduce regulation of the financial services sector, boost the use of Fintech and invest in business, Reeves said in her speech: “We are launching a call for evidence on the credit union common bond and asking regulators to report on the mutuals landscape.
“And I welcome the work of Nationwide, the Co operative Group, Arla and Royal London to establish an industry led mutuals council to drive growth in the sector.”
Reeves will also be writing to the Financial Conduct Authority and Prudential Regulation Authority asking them to produce a report on the mutuals landscape in 2025.
The government says it has already laid legislation to support modernisations to the Building Societies Act 1986 and continued funding the Law Commission to conduct reviews considering how the laws governing co-operatives, community benefit societies, mutual insurers, and friendly societies can be modernised.
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Sector body Co-operatives UK welcomed the plan as “a super significant milestone”, adding that it will use its Co-operative Growth Strategy, to be published in January, to highlight opportunities for growth and impact.
It says the council “will serve as a structured forum for collaboration between the government and the co-operative and mutual sectors. It will provide technical expertise, inform and offer innovative solutions focused on mutual ownership and control based on experience and learnings from the UK and international movement”.
CEO Rose Marley said: “The power of co-operatives and mutuals to drive fair and sustainable growth has been overlooked by past chancellors, but not now. Rachel Reeves has shown clear and practical intent to push forward co-operative solutions to some of the UK’s biggest challenges.
“As part of government’s commitment to double the size of the sector, the mutual council will create an opportunity to embed more mutuals into the economy; to create inclusive growth and an equitable future. We’re a step closer to a business environment that allows and encourages existing co-operatives and mutuals – businesses that do so much for people and communities – to grow and thrive.”
Joe Fortune, secretary general of Labour’s sister organisation, the Co-op Party, said: “The Co-op Party and movement have worked hard to shape the new government’s commitment to co-operative and mutual growth, and the creation of a new Co-operative and Mutual Council is another key step forward.
“By creating a supportive environment for co-ops and co-op growth, we can unlock the potential of this key sector to drive inclusive growth.”
Robin Fieth, CEO of the Building Societies Association, said: “I am delighted the chancellor has used her first Mansion House speech to demonstrate the government’s commitment to double the size of the mutual economy by announcing a package of measures to support the growth of the sector.
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“A strong mutual sector provides choice for consumers and creates resilience for the financial sector. When you’re with a mutual, you can be confident that the profits are reinvested in the business and the interests of members and communities, not hived off to external shareholders.
“We are very much looking forward to working with the new Mutuals and Co-operative Council as it begins this exciting journey.”
Posting on LinkedIn, Peter Hunt from Mutuo said: “This is a momentous step forward for the UK mutual and co-operative sector.
“Mutuo has long advocated for a more joined up approach from our sector and this will build on the efforts of the Building Societies Association, Association of Financial Mutuals, Co-operatives UK and Association of British Credit Unions to work together to increase the impact of co-ops and mutuals.
“We look forward to working with colleagues and Government to take full advantage of this once in a lifetime opportunity.”
Association of British Credit Unions (Abcul) CEO Robert Kelly said his sector has “strong ambitions to grow beyond its current capacity and this call for evidence will be transformational to the movement across the country”.
He added: “Abcul is delighted with the chancellor’s proposals, which marks a pivotal moment in strengthening the co-operative and mutual sector across the country. Credit unions are founded on the ethos of people helping people and reform of the credit union common bond will provide a great opportunity to enhance the role of our sector in so many different ways.
“The new Mutuals and Co-operative Council will also be instrumental implementing a strategy to further grow the vital services our sector provides – building financial resilience and investing in our communities across the country.
“We believe the sector can play a key role in supporting communities to be financially resilient and continue to build a secure future for those who need it most.”
From the worker co-op sector, Yorkshire-based Suma Wholefoods also welcomed the speech as “a new era for co-operatives”. Chair Adam Cole added: “This is a landmark step, it take us towards a more co-operative future. This council will boost collaboration between government and our co-operative sector, we share a vision to grow the size of the co-operative, mutual and wider economy. This is a major win for us, a positive step for inclusive growth and a fairer economy.”
Secretary Ross Hodgson said: “Worker co-ops can, and should be, a big part of the pledge to double the size of the co-operative sector. Workers are an integral part of what the government has said it is there to support, and there is no better way to do that, than by giving workers more control over their work.
“We look forward to seeing how the council progresses this work, and the steps they can take to improve the landscape for worker co-ops in the UK.”
Meanwhile, the Law Commission consultation on co-op and community benefit society law is now open. Co-operatives UK is encouraging members to get involved here.
