Co-operative and Mutual Businesses — House of Commons, 2019-06-27
Topic: Domestic Commerce
Steven John Baker (Conservative, Centre-right): Of course I did know that, but the hon. Gentleman has certainly added colour to my understanding of the idea that we are all prisoners of where we come from, and perhaps that was one of the reasons. Now is the time we can have a renewal in our understanding of what can be achieved. Today, as the hon. Member for Harrow West set out, co-operatives are extremely important. They give an opportunity for people to gain control and agency over local economies, whether in land trusts or in other areas—we have mentioned public services. I will never forget listening to a young woman talking highly entrepreneurially about how a social care co-operative was working. It was remarkable to listen to the degree of ownership that lady felt. In other circumstances, she might have been doing "just" the valuable work of practically caring for a person, but in addition she felt really engaged in the operation of the business. That is an entirely noble thing. It is part of the process of becoming what it is to be human—to be really engaged like that in how these businesses run I wish to bring a few matters to the Government’s attention, and again this comes from Co-operatives UK. These are a few of the barriers out there and some policy options, which I would like the Government to consider. Co-operatives UK suggests: "Fertile conditions for co-op formation are often absent" because, for example, there is a shortage of "social capital and limited devolution of economic power and funding to the community level." Going back to the 1911 Act, I wonder whether this is a part of a broader trend over 100 or more years, and whether we need to make sure that social capital and the devolution of economic power facilitate mutual and co-ops. Co-operatives UK then cites: "Established cultures and norms of behaviour", with people sometimes "culturally disinclined to co-operate". We need to think of ways we can encourage people to join in co-operatives There is, of course, a lack of awareness, practical understanding and good advice about this, which, I am sorry to say, we can witness on my side of the House today; too few Conservatives understand the role of co-operatives and mutuals. We could do more, as a Government, to explain to people the role of mutual and co-ops in a free society. Co-op frameworks are not as user-friendly as they should be, and we have heard some examples of that Of course, I support what the hon. Member for Harrow West said about building societies and extending capitalisation opportunities to other co-ops. I remember opposing the demutualisation of building societies as a young man. I did not really know why at the time; it just seemed instinctively wrong not to have that plurality. Our corporate frameworks and governance arrangements should be friendlier to co-ops. Members have touched on financing challenges, and they are generally part of the operating environment The proposals from Co-operatives UK include: "Rather than giving all the funding and power to LEPs"— local enterprise partnerships, in England— "government could commit 25 per cent of the new UK Shared Prosperity Fund for community economic development" The Government should certainly consider that, along with encouraging LEPs to look seriously at the role of co-ops in their local communities through local industrial strategies. Co-operatives UK proposes that there should be a social-investment tax relief, suggesting that we should: "Use the current review of Social Investment Tax Relief to make it more supportive of Community Shares, by making community investment in land and real estate, housing development, sustainable agriculture and renewable energy eligible." It also suggests employee ownership tax support and help for co-ops with making tax digital, which is something of a curse on a number of small businesses I have reservations about the idea of dormant assets being used to support co-ops. My concern is related not to co-ops, but to the idea that dormant assets are someone’s property. We should be a little cautious there, but Co-operatives UK has made that recommendation. It also proposes legal reform to ensure that we bring things up to date and support co-ops in the law At this time of great political turmoil, not only in the UK but in France, Germany, Italy, Spain, Greece and the USA, we need to think extremely seriously about the institutions that we have and how to make them flourish. A great and wise defender of the liberal market order once wrote: "Society is co-operation; it is community in action." I very much hope that, through the kind of collaboration we see in the House today, we might one day educate Members of Parliament and the public as to what that idea of society as co-operation really means, and through doing that reinvigorate our society and better fit it for the future.