Co-operatives

Luciana Berger Excerpts

Thursday 14th July 2016 Westminster Hall

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I declare an interest as a proud member of the Co-operative party, the sister party to the Labour party. I am one of the 25 Labour and Co-operative MPs.

I am proud to be taking part in this timely debate on the contribution of co-operatives to our economy. For me, a co-op is about more than a collection of shops and companies and enterprises, brilliant though they are. For me, co-operation is a sign that there is a better world possible than the one delivered by pure free market and small-state ideology, and a better way to deliver social justice than overarching Government and state control.

Co-operation is about three things. First, it is about the best instincts of decent people: the desire to work together, play together and get along with one another. It is about the human instinct to band together, co-operate with one another and offer selfless, mutual support—proof that we achieve more together than we do alone.

Secondly, co-operation is an international creed. The co-operative movement is a truly international movement, because the values of decency apply across the continents, no matter which country one comes from.

Thirdly, the co-op has a celebrated history, but it is really all about the future. We know the story of the Rochdale pioneers who, all those years ago, started the first co-operative, but when it comes to the challenges of tomorrow—tackling global poverty, helping the poorest nations to build their economies and meeting the challenge of climate change—it is the co-operative ideal that best equips us to succeed.

When I look at a co-op, I see a glimpse of the future and get a sense of what might be. In so many ways, the co-operative movement prefigures the kind of society that I want to see: democratic, equal, fair, just, accessible to all and owned by everyone. That is especially true in the current economic climate. The economic impact of Brexit is just starting to be felt and there are very uncertain times ahead. There are big changes coming down the line, and there is fear—certainly in my constituency—that employers might move to Dublin, Frankfurt or Madrid. To survive Brexit, we will need new trading arrangements, access to new markets and new firms to fill the gaps. That is where the co-op and mutual sector, with its emphasis on fair trade and trade justice, can step in.

We wait to see what a Government led by the right hon. Member for Maidenhead (Mrs May) will bring. I hope she will maintain all the workers’ rights that are currently guaranteed by the EU. Again, the co-operative and mutual ideal can be made to work for workers who are self-employed or in small firms. As we heard from my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), freelancers in particular can form co-operatives to protect themselves. An exciting and important example is how the Musicians Union has worked with and supported 50 music teachers in Cardiff. I hope we will see more such cases.

Co-ops can provide greater stability and support in a post-Brexit world of insecurity and risk. It is a real shame, and a missed opportunity, that both the coalition Government and, more recently, the Tory Government have paid so little attention to co-ops. We have come a long way since the days of the Conservative Co-operative Movement—one of the more audacious pieces of repositioning by the former Prime Minister, the right hon. Member for Witney (Mr Cameron). The Conservative-led coalition was no friend to the co-op movement. Between 2010 and 2015, Ministers withdrew support for solar renewable energy co-operatives, forcing many to close down; took funding away from the co-operative schools project, which was making a real difference for many schools throughout the country; and shelved plans for more co-operative Sure Start centres and housing trusts. I am a passionate believer in education about alternative models of ownership. In too many schools throughout the country, from primary right through to secondary, young people are not learning about the co-operative and mutual alternative.

What about the current Government? It will be interesting to hear what the Minister has to say, but their record could be better. I welcome the new Prime Minister’s announcement that she intends to put employee representatives on company boards—a policy advocated by the Co-operative party. I sincerely hope that a workable scheme is brought forward that we can all get behind. I wonder what the new Prime Minister and the Minister will make of the other policies that we co-operators have been championing. They include having a proper scheme whereby all businesses with more than 50 employees are obliged to set up a profit-sharing scheme with their staff, with a minimum profit share pot set aside based on a calculation of annual profits. We know from the Office for National Statistics that approximately 36,000 companies would be in that bracket, affecting 12.9 million people. That would make a massive difference.

We co-operators want to introduce a duty to involve, with employees given a formal role in making decisions about how a company is run through works councils. The Co-operative party is calling for all publicly listed companies to have a duty to involve their employees. We want tax incentives for employee ownership. As it stands, the Government spend £615 million every year on tax incentives for employee ownership, but that is poorly targeted towards individual shareholdings and the remuneration of senior executives. That could be refashioned to ensure that all employees benefit.

We also want tax incentives for community energy. What could be better or more important than allowing communities to create energy and own it themselves? That would not only reduce our reliance on carbon sources and do more to meet our renewables target, but ensure that all the people in a community could own their own energy. Over the past two years, the Government have radically changed the regulatory environment for community renewable energy schemes and withdrawn tax incentives that encouraged community investment in those schemes. I sincerely hope that they will revisit that decision.

Tax incentives should also be used to ensure that sports clubs that meet stringent criteria for fan involvement and engagement can secure special tax status. If we reflect on the recent Euro 2016 championships, it is notable that many of the star players play for co-operative clubs such as FC Barcelona, Real Madrid and Bayern Munich. Indeed, in Germany, 33 out of 36 clubs in the Bundesliga are co-ops. As the new Prime Minister formulates her plans for Britain post-Brexit, I hope that she will look to the co-op and mutual model for ideas.

I am grateful to the House of Commons Library for putting together a really extensive list of all the different co-ops in my local area, including the Lodge Lane and District Credit Union in my own constituency, which I am proud to be a member of. However, the list did not include a new co-op, a café that is going to be situated on a road that goes through my constituency. I wish that co-op every success.

Co-ops and mutuals are about the future, not the past. I am proud to call myself a co-operator, and I will continue to campaign to ensure that we see more co-operatives and mutuals flourishing. I look forward to hearing the Minister’s response to the debate.