Co-operative enterprises
build a better world

UK co-operators receive government support

27 Mar 2013

 

The British co-operative movement is making strides with government to fulfill areas of the Blueprint for the Co-operative Decade.

Published in draft form last year by the ICA, with the final version released in February, the Blueprint aims for co-operatives to be the fastest growing form of enterprise by 2020.

To achieve this, the Blueprint recommends a number of areas to strengthen co-operatives in the economy and society. In the United Kingdom, Co-operatives UK, the trade body for co-operatives, has campaigned successfully for the government to recognise the creation of a legal framework and to make access to capital much easier.

Last year, Prime Minister David Cameron announced that 17 separate pieces of legislation that govern co-operatives will be brought together to form a Co-operatives Bill. This piece of legislation is set to be debated in Parliament this year.

Mr Cameron said he has “long cared” about the co-operative movement. He added: “We know that breaking monopolies, encouraging choice, opening up new forms of enterprise is not just right for business but the best way of improving public services too. There are over 12 million co-op members in the UK. That’s more people than there are shareholders in the economy. But right now there are too many barriers in the way.”

Co-operatives UK Secretary General Ed Mayo said: “Two key elements of the ICA Blueprint are to create a legal framework for co-operative growth and to develop models for financing co-operatives, and here in the UK we’ve made some significant strides with government on both in recent years.

“At the start of 2012, the UK movement was the first country to strengthen the legal framework for co-operatives. Following close lobbying by Co-operatives UK, the Prime Minister David Cameron announced the government’s commitment to consolidating existing legislation on co-operatives to create a simplified Co-operatives Act.”

Last month, Chancellor George Osborne unveiled his annual budget that announced a consultation with an aim to increase the withdrawable share capital in co-operatives (known as industrial and provident societies). The current limit for any one person or organisation to invest in a co-operative is £20,000.

The summer consultation is set to ask views on what a new limit should be. As part of the same process, submissions will also be invited on the introduction of insolvency procedures for IPSs and credit unions.

Mr Mayo added that he was pleased to see another measure that his organisation has campaigned on being introduced by the government. He added: “Like co-operatives around the world, co-operatives have been growing sustainably in the UK despite the tough economic climate since the beginning of the financial crisis in 2008. The number of co-operatives has risen by 23% since 2008 and, whilst the UK economy as a whole has contracted, the turnover of the co-operative economy has grown by nearly 20%.

“Our work with government to put co-operatives on a level playing field with other business forms stems from this strong performance. We’re seeing much greater interest from government in recognising the co-operative model of business.”

• To find out more about Co-operatives UK, visit: www.uk.coop. Photo: Co-operatives UK's Ed Mayo (right) with Prime Minister David Cameron, and back Co-operatives UK Chair David Button and ICA President Dame Pauline Green.