Blog article

Co-operation and the state

It is such a welcome step that the Government has taken today to put the jigsaw of legislation around co-operatives and societies onto a coherent, simplified footing.

This is something that co-ops have argued for for ages. The then United Kingdom Co-operative Council first mooted proposals for a Co-operatives Act in the 1990’s. Since then there have been a number of steps towards the process of reform including a series of private members bills and consultations led by the Treasury.

The law is more fragmented than faced the charity sector, which has benefited from the same process under the last government. Both charities and companies have had consolidation acts. The last one for co-operatives was within months of me being born – a little while ago. So it is a great and helpful step to charge the Law Commission with coming up with a Consolidation Act for Co-operatives and Societies, to come to Parliament in due course (due course always meaning some time down the line: there is a risk there, but the process is underway and getting to start has always been the difficulty).

The benefit of a clear, new law is also that there is greater understanding and recognition of the society model, with all it’s democratic credentials and quality. I have seen enough examples of business advisers not understanding it, policy makers not understanding it (no coop school for example has been allowed to form in legal terms yet as a society) and coops facing uncertainty or having to pay for expensive professional advice in order to get on and do business.

Changing laws doesn’t make for business success. But laws can get in the way. As a cooperative legislator from a previous generation, WP Watkins, wrote “true cooperation draws its inspiration from realms where the state’s writ does not run. Cooperative movements are not created by legislation. Nevertheless, without an appropriate legislative framework, a cooperative movement in the form of a growing economic organism is not possible or even conceivable.”

It is fair to say, this is a historic decision.


Written by Ed Mayo
Updated: 19/01/2012