Government must take immediate and effective action to prevent permanent damage to UK businesses, including co-operatives.
As energy prices soar, 25% of co-operatives are concerned for their survival over the next 12 months, with 5% approaching crisis point and fear they may be forced to cease operating within the next three months.
James Wright is Policy and Development Lead for Co-operatives UK, the trade body for the UK’s 7,000 independent co-operatives. He said: “The rapidly escalating economic and social crisis means the new Prime Minister must act immediately to support households and businesses.
“Our latest data adds to evidence that to do otherwise risks a ‘doom-loop’ of destitution, corporate insolvency, high unemployment and wasted potential.
Co-operatives UK is writing to the Prime Minister with an urgent ask of government. James Wright said: "Co-operatives must be fully included and effectively supported in any action for businesses, along with all other social enterprise, community businesses and charities affected by the energy price shock
“Our members are particularly calling for action to limit prices for non-domestic energy customers.”
Co-operatives are businesses that trade for mutual and social purpose. As non-domestic energy customers, they are heavily exposed to the energy price shock. As businesses they are also exposed to wider inflationary pressures, as their input costs rise and discretionary consumer spending falls.
Co-operatives UK surveyed its members* and found:
Half of responding co-operatives, which together employ more than 85,000 people, say they are severely impacted
25% say they are concerned about their survival in the next 12 months
5% are concerned about their survival in the next three months
28% of co-operatives say their ability to create value for members/customers/communities in a financially sustainable way is severely undermined
The ability and potential of these businesses to create and sustain decent livelihoods, expand opportunity and benefit communities across the UK, is jeopardised.
James Wright said: “Co-operatives are an essential part of the social economy our communities rely on in hard times. Of the co-operatives who tell us they are severely affected, 60% are currently active in the mutual aid response to the social emergency and are looking to ramp up such activities over the winter, subject to their own financial sustainability.
“What’s more, co-operatives offer excellent prospects for growing a stronger, fairer, greener UK economy. We cannot afford to lose these co-operatives now. The new Prime Minister must take immediate and effective action to prevent permanent damage to businesses, including co-operatives.”
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* Co-operatives UK surveyed its members on the impact of the energy crisis in August. These results cover responses from 25 August (survey open date) to 5 September with 8% of direct members completing the survey.