Co-operatives and Mutuals

Jim Shannon Excerpts

Tuesday 10th December 2013 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

Thank you, Mr Deputy Speaker. I asked for your indulgence and appreciate the opportunity to contribute to the debate. I congratulate the hon. Member for Harrow West (Mr Thomas) on making such a valuable contribution on the importance of co-operatives and mutuals.

I would like to make a few quick points—they will be quick—about co-operatives in Northern Ireland. The hon. Member for Harrow West outlined the importance of co-operatives for England, Wales, Scotland and Northern Ireland, so I shall follow that up in respect of the benefits for Northern Ireland. The benefits of co-operatives could be seen when workers in Northern Ireland decided it was time to do something and they got the expertise they needed. The Belfast Cleaning Society was set up by six cleaners, and the company, established as a social co-operative, is now winning contracts, including from local councils. That happened after help from the co-operative enterprise hub with legal and business advice—the very advice to which the hon. Gentleman referred earlier. That is what led to this company starting up with just six workers. The success of the Belfast Cleaning Society has been tracked by other groups of cleaners, frustrated by an industry that typically pays the people who do this work only the minimum wage. That illustrates why it is important to have a co-operative that works for the people and benefits the people and all involved.

Many more examples could be cited. The hon. Gentleman referred to some examples in England and Scotland. I am aware of one example in Clevedon in Somerset, where the town’s bookshop was threatened with closure. A community share issue was raised, and the 600 people participating raised the £20,000 needed to buy the shop. The “Clevedon Community Bookshop” has since gone on to advise other communities about how to keep vital local businesses going. There are two examples—one in Belfast and one in Clevedon, Somerset—and the hon. Gentleman put forward many other examples of where co-operatives can be of great benefit.

Let me deal briefly with a new initiative for Northern Ireland that is coming off the backs of the co-operatives and the mutuals. I refer to the Building Change Trust and the Co-Operative Alternatives, which are leading the way in developing a community shares programme in Northern Ireland. This project is the first initiative of this kind, proposing to make community shares more known and understood in Northern Ireland and identifying and selecting a sample of local enterprises and initiatives with community investment potential to help them to become community share investment ready. These are the very businesses to which the hon. Gentleman referred in respect of ferries, for example. These community shares will enable people who collectively want to ensure that co-operatives and mutuals can happen to initiate business opportunities.

Community shares are a unique form of share called a “withdrawable share”, which can be issued by co-operatives and community benefit societies. A withdrawable share is very different from an ordinary share. A withdrawable share can be cashed in or withdrawn, subject to the rules of the society, and is not tradable on the stock exchange. The co-operative societies are for the mutual benefit of all their members, while community benefit societies are for the broader benefit of the community. Both legal structures uphold the principles and values of co-operation.

I believe that these community shares provide long-term risk capital that can leverage further funding. Societies can use community shares to raise finance, but also to recruit members and to initiate business opportunities for collectives across the whole of Northern Ireland. I believe that these opportunities will support the social aims of the community enterprise concerned by investing the money, purchasing these shares, making the community investor a part owner in the community initiative, able to have a democratic say and further social aims, as the principle of one vote per shareholder implies.

I have given just a small synopsis of what is happening in Northern Ireland, but I wanted to put it on record and ensure that it appeared in Hansard. I think that this evening we should concentrate on the pluses, for there are many pluses involved in what co-operatives do throughout the United Kingdom. They provide an opportunity for those who might not have had it in the past to start businesses and to come together and benefit the community as a whole, which is what many people want to do. All that is needed is a wee push, a wee nudge, a wee bit of legal advice and a wee bit of support—and then, hopefully, co-operatives and mutuals throughout the United Kingdom of Great Britain and Northern Ireland will be able to continue to grow.