A series of proposals to help put smaller co-operatives on an equal footing has begun to move through Parliament.
Describing them as “small but important changes” in his speech to Parliament, Adrian Bailey MP tabled the proposed ‘small and medium size co-operative development bill’ in order to draw attention to a series of measures that Co-operatives UK has been highlighting to government this year. There are three main elements to the Bill:
- Removal of the requirement for co-ops with a turnover of less than £5,000 to appoint lay auditors to scrutinise their accounts, bringing them in line with companies
- Increasing the turnover threshold at which co-operatives have to apply full audit requirements from £5.6 million turnover to £6.5 million, putting them on the same footing as companies
- The requirement on co-operatives for an auditor’s report will be contingent on the amount of share capital raised by the co-operative rather than a turnover threshold
A member of the Labour and Co-operative Party, Adrian Bailey, a long-time advocate for the co-operative sector, said in his speech:
“These legislative changes are designed to give further impetus to a business model and movement that are flourishing but are yet to achieve their full potential. I anticipate that these changes would benefit thousands of small co-operative societies around the country.”
The Bill was supported in Parliament, and will pass to its second reading in Parliament in February next year. Whether it become law will depend on levels of support, and Co-operatives UK alongside the Co-operative Party, will continue to press for it.
Commenting on the proposal, Ed Mayo, Secretary General of Co-operatives UK, said:
“It should be as easy to start a co-op as any other business. But we know that red tape can often hold up smaller co-ops. We have been arguing for the need for these changes this year and are delighted that Adrian Bailey has taken up the cause for these simple but practical proposals. We look forward to seeing this Bill move through Parliament and, ultimately, make life easier for the thousands of small co-ops across the UK.”
Adrian Bailey also re-iterated his support for Co-operatives UK's call for government responsibility for co-ops to be in one department - the department for business - rather than scattered across government, saying:
"There is a powerful argument for a dedicated team of civil servants to be set up within the Department for Business, Energy and Industrial Strategy to act as a champion for co-operatives and - in line with the Prime Minister’s thinking - to examine ways of developing a more inclusive society."