Co-operative Sector: Government Support

Debate between Jim McMahon and Paul Waugh

Tuesday 21st October 2025 Westminster Hall

[Jim McMahon]

I think a lot of people in Britain feel as though it does not matter what they do, how hard they work or how big their contribution is; they are just not able to make ends meet or get on in life. The communities where they live have been incrementally eroded and hollowed out, and they do not feel like they are getting on and doing well.

The founding principle, if we take ourselves back to Rochdale and towns like Oldham, where this is part of our heritage, history and identity, was a sense that if we build something together, we share the dividend that comes from it—that we redistribute the value that we create in order to build an even stronger community. I think we observe a country and economy where the wealth that we create is taken off to foreign lands and international investors more than it is reinvested back in the local community. Co-operation is of course about power, but it is also about place and identity, and the co-operative movement is central to that.

[Paul Waugh (Rochdale) (Lab/Co-op)]

My hon. Friend kindly mentioned Rochdale and its proud history in 1844 of the Rochdale pioneers founding this global movement for social justice. It is still a movement that is alive and kicking today. It is not a relic, as is evidenced by the Metro Moneywise credit union, which celebrated its 35th anniversary last week in a town hall ceremony in Rochdale at which I was pleased to be present. Does my hon. Friend agree that the most important point is that the Labour party has agreed to double the size of the co-operative economy, and that the whole of Government needs to get stuck in to achieve that—not just the Treasury, and not just the brilliant new unit in the Ministry of Housing, Communities and Local Government, the co-operative development unit, but every part of Government?

[Jim McMahon]

If it is to work, the whole of Government has to own this agenda. It is important that the Treasury and the Department for Business and Trade take a leading role, and of course, the community anchor in the MHCLG is important too, but the truth is that communities function in a dynamic way, and every bit of Government across health and social care, education and our school system, and everything else that Government have oversight of, comes into play. I absolutely agree that if we want to double the size of the co-operative economy, and for that to be felt in every part of the country, the whole of Government has to own that agenda.

Across Britain, too many people feel that the economy no longer works for them—that decisions that shape their lives are made far away by investors they will never meet and for reasons they do not agree with. We see the results in hollowed-out high streets, in local businesses that are bought and closed by distant investors, and in a growing sense of powerlessness. If we want to rebuild trust in politics, we must rebuild trust in the economy alongside it. That means giving people real ownership and control over the businesses that shape their lives, because ownership matters; that is exactly why those with wealth fight to keep it. We want more people to benefit and to have a stake in the future.

The good news is that the UK’s co-operative economy is thriving. Today there are 7,400 co-operatives, with 16.6 million members, and 240,000 employees working hard in their communities. Together they span retail, housing and agriculture, and beyond that, of course, social enterprise, creating decent jobs and trying to provide food and shelter for millions of people in this country.

Going further, our 42 building societies, owned by their 27 million members, contribute £7.2 billion to the UK economy. They account for nearly a third of UK mortgages and maintain over a third of all bank branches. Of course, as my hon. Friend the Member for Rochdale (Paul Waugh) said, our credit unions serve their 2.3 million members and hold nearly £5 billion in assets. Do people know that there are more members of building societies and credit unions than there are people who voted in the last general election? This is not a fringe part of the economy; it is absolutely foundational.

After years without a mutual bank presence on the high street, the recent acquisitions of Virgin Money by Nationwide and of the Co-operative bank by Coventry building society mark a welcome return of mutual principles to mainstream banking on the high street. Employee ownership is rising, too, from 600 employee-owned firms in 2020 to 2,500 today. That shows what happens when Government action aligns with co-operative values: co-operatives are more likely to grow and more likely to survive.

However, despite our proud history, the UK now lags behind other countries. If we are to fulfil our potential, the Government must create an environment that enables co-operatives to thrive.