Co-operatives and Mutual Societies

Luke Pollard Excerpts

Tuesday 14th December 2021 Westminster Hall

[Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)]

Thank you, Dame Angela. You will be pleased to hear that I will not inflict 20 minutes of Plymouth co-operatives on everyone. However, I would like to thank the hon. Member for Wycombe (Mr Baker) for introducing this debate. It is really important that co-operatives and mutuals have a voice in Parliament; that is why, for the past many decades, we have had a Labour and Co-operative group of MPs that has been making the case for co-operatives. I am proud to be a Co-operative party MP; those are not just some extra syllables in my job title. Being a Co-operative MP is not just a label; it is an instruction to campaign for mutuals, fairness, co-operation, doing business in a fairer way and sharing wealth and power. Those of us in the Co-operative party take every opportunity to put forward the huge advantages of co-operative and mutual business models.

We have seen huge changes and progress in recent years, both under the last Labour Government and, where campaigns have been successful, under the current Government. However, we are seeing the context change; we are seeing a hollowing out of our communities and a more precarious environment for businesses. However, we are seeing no less entrepreneurism and no less drive and creativity from our businesses. People are now looking at alternative models to organise their business to make a difference.

When businesses fail, it is often because those in charge have become removed from the realities of the shop floor. That is where mutuals and co-operatives have an advantage over other business models. When workers have a stake in their own business, they can contribute to the decisions that are made; they can see that businesses can be better run, more sustainable and better focused on not only the product and service they offer to their customers, but the people who work in that business to make it better every day.

Co-operatives provide an opportunity to renew our high streets and villages and to give everyday people a say in how their local community works. The opportunity to expand the co-operative and mutual sector is immense. I would like to see the Government adopt Labour’s policy of doubling the size of the co-operative sector. It is a bold, challenging ambition; however, if Ministers put in place the right conditions to make it happen, it is also achievable.

Doubling the size of the co-operative sector would lead to more sustainable, greener and better jobs in all our communities, more people having a stake in the businesses they work for and, as we heard from the hon. Member for Wycombe, better productivity and better outcomes at the end of it. It is a win-win-win situation. There are only two things that hold it back: a view that the market will provide for itself—in which case, let us remove the legislative blocks that sometimes discriminate against co-operative and mutual businesses—or a view that it will not provide the type of future we need. I do not see a future that does not include more mutual and co-operative businesses. That is what we heard from the hon. Member for Wycombe, and I hope that is what we will hear from the Minister when he gets to his feet.

In the south-west, we have long believed in the power of co-operatives to strengthen our economy. In Plymouth, we have co-operatives such as Nudge Community Builders, which works to transform life chances in one of our poorest communities—not just in Plymouth, but in Britain—by rebuilding and refurbishing buildings along Union Street and Stonehouse. It is transforming that community by not only improving the buildings, but creating spaces for start-ups, social enterprises and community services. It is helping to restore pride in something by allowing people to invest in their own community through that effort.

I bought shares in Nudge’s co-operative share issue to help reopen the notorious pub The Clipper, on Union Street, taking it from a 24-hour boozer to an amazing community space. It has transformed that community just by changing one pub. I have also bought shares in its latest effort, to reopen the Millennium building—a former nightclub and cinema, and the scene of far too many antics to discuss in polite company—as a new hub for live music, with a brewery, a shop and restaurants, and a place for people to come together. That building has stood derelict for decades, and it is a co-operative and community venture that is bringing it back to life. That share issue is still open, if the hon. Member for Wycombe wants to show his support. I know that Nudge would welcome a final push to help get it over the line.

However, it is not just Nudge that has done brilliant things using co-operative share issues. I also praise Plymouth Energy Community.

[Mr Steve Baker]

The hon. Gentleman has spoken with such passion and enthusiasm—he could not see, under my mask, the enormous smile he put on my face. If he sends me a link to Nudge’s site, I will have a look at investing. I would be delighted to consider it.

[Luke Pollard]

I thank the hon. Gentleman for his enthusiasm. I am really passionate about this issue, and people in Plymouth that have invested are passionate too. It is not just about investing. Co-operative share issues have not had the press they deserve, because it is not just that putting that 50 quid in a co-operative share issue or a mutual will return more financial benefit than leaving it in a bank where interest rates are low. It is about the social purpose—the social multiplier—and the economic multiplier that will come from that investment. It is taking place not only in Plymouth, but right around the country.

Plymouth Energy Community has funded solar panels on the roofs of our city’s primary schools and our largest leisure centre, as well as on the top floor of all our car parks. It has opened Plymouth’s first solar farm in Ernesettle and it is about to apply for planning permission for a second solar farm at Chelson Meadow—next to Saltram House—which is the scene of Plymouth’s largest landfill. I will support that share issue when it opens, too.

CATERed is another superb example of a co-operative in Plymouth. Faced with the challenge of poor school food, the Labour council brought together food provision into a co-operative, which our primary schools and some secondary schools have now bought into. That provides not only healthy, nutritious food but an investment in the staff who provide that food—in the kitchen and serving—which is unbelievable. What is important is that those staff feel valued, the food is healthier, the profits are reinvested and there is not a turkey twizzler in sight. It really is a model for others to follow.

[Stephen Doughty]

My hon. Friend’s example sounds very much like the Big Fresh Catering Company in the Vale of Glamorgan, which I mentioned. Does he agree that co-operative councils, such as in Cardiff—Plymouth sounds like a co-operative paradise; I assure him that Cardiff is too—are also making differences in other areas of public services by using co-operative principles? I think of our music strategy and the Cardiff Music Board, Cardiff Commitment, which is supporting young people back into education or training, and our race equality plan. All have co-operative principles at their heart, investing in that social capital in our communities.

[Luke Pollard]

My hon. Friend is exactly right. There is an energy around this policy area not only because it returns good outcomes but because it is the scene of so many good ideas and so much innovation. That innovation is often at the periphery, because co-operatives and mutual are not mainstreamed in the way that they really need to be. There is not an accelerator that moves those ideas into the mainstream. As co-operators, many of us are quite nice, decent people, and mutualism has a reputation of being nice and caring for and lovely, which often means that we are quite comfortable sitting in a corner. As an economy, we often say, “We have got a fair mutual side; it’s over there in the corner.” We know it is important because we put it in the corner where we put all our important things. It is time now to move mutual and co-operative policies into the mainstream, not only as niche providers but as an alternative to mainstream provision that would give those mainstream business models a run for their money. To do that, some of those legislative and, in particular, financial resourcing barriers need to be removed. There is an opportunity to go through them progressively and remove them, to make sure that we are getting there.

Creating a co-operative development agency in England, following the lead of Wales, would make a big difference. We could put new duties on Governments to promote the growth of co-operatives, not just of businesses. We could look at new capital instruments, such as a national co-operative-held investment bank, which would allow better investment in UK co-operatives. We could consider a new duty on banks to encourage greater lending to co-operatives and to ensure banks are held to account over the types of businesses they support. There is sometimes discrimination in funding to co-operatives because their corporate structures can be a little bit different, a little bit challenging. However, the social benefit and opportunities that come from that investment can be even bigger than investing in the usual type of business models. There is an opportunity there to make that happen.

[Christina Rees]

My hon. Friend is giving a passionate and comprehensive speech. The number of co-operatives is low. Perhaps there is a case for a business model in which a co-operative’s share of a private or public enterprise could be incorporated into the model, so that we raise awareness of the advantages of being part of a shared ownership scheme.

[Luke Pollard]

I am grateful to my hon. Friend for that. Long before I had grey hair and was elected to this place, I wrote an article for the Co-operative party about co-operative insurgency—the idea that a harder, bolder form of co-operation could also come out of a purposeful building out of a co-operative shareholding in business models. To follow my hon. Friend’s idea, it is not only about creating a co-operative or mutual from day one; it can be about mutualising a business model. Even a small, co-operatively held component of a big publicly listed company could help drive and direct an ethos and culture change within that business, which could produce better outcomes for staff and the overall business model.

However, I am afraid that not all is well in our co-operative sector in Plymouth. Our Plymouth credit union is on the verge of closure, which I worry will deny access to finance for people on the margins of finance and society in particular. The City of Plymouth Credit Union’s office is opposite my office, on Frankfort Gate, and at the end of the week, the queues that come out of that credit union show a number of individuals who always face challenges—not only economic and financial challenges but challenges elsewhere. We must also be aware of the closure of credit unions. I do not know what will replace the provision the Plymouth credit union gives to some of those most marginalised people, but we need to find an alternative. The basic bank accounts that the Treasury has been promoting via businesses will not be enough to replace the service provided by Plymouth credit union, and I encourage the Minister to look at what happens when credit unions fail.

[Jim Shannon]

I thank the hon. Gentleman for his excellent contribution. As I said in my contribution, when some of the smaller credit unions closed they were amalgamated with larger ones. Is that a possibility for the credit union that he is discussing?

[Luke Pollard]

I thank the hon. Gentleman for his intervention. I hope that it will be, but I fear it may not. The challenge is that the future is very uncertain, especially for smaller credit unions that do not have the financial backing of a larger credit union. The social benefit that they provide is considerable, and it is worth the Treasury looking at that.

My final point is a challenge to those people who speak about co-operatives and mutuals, like myself and everyone in this place. Often the debate around co-operatives and mutuals is an urban-themed one; as an MP for a city, most of my examples have been urban themed. However, there is enormous potential in telling the story of the success of the mutuals and co-operatives in our rural and coastal communities. In our rural communities, we see an amazing penetration of successful co-operative businesses, providing support at scale not only for rural housing and, in particular, agriculture, as we heard from the hon. Member for Strangford (Jim Shannon), but for fishing. Greenhook Fishing in Plymouth is our brand-new co-operative. It is pioneering sail-powered fishing in Plymouth, and is bringing back the Plymouth Hooker, a fantastic old-style fishing boat. It also provides opportunities for people who have left prison and veterans to be re-trained in new skills, not only in boat construction but in fishing.

Greenhook Fishing is following a model that is present in many other coastal communities and rural communities —of co-operatives being successful, getting on with it and never identifying as a co-operative. My challenge to those who speak about co-operatives is that we should talk up rural and coastal co-operatives as well. I am very pleased that the Co-operative party has started a new commission around rural co-operatives, to feed into Labour’s rural review, that will make the case for further investment in rural co-operatives as distinct from urban co-operatives and the challenges that they face. The future is bright for mutuals and co-operatives, and I look forward to hearing the Minister’s response.

[Dame Angela Eagle (in the Chair)]

I now call the Front-Benchers, beginning with Chris Stephens.