Why the Tories (and Labour) have missed the cooperative factor

Why the Tories (and Labour) have missed the cooperative factor

In August 2007, just as the impact of the sub-prime crisis in the US housing market was starting to be seen, but before the banking crisis, I did a Radio 4 Thought for the Day on the importance of co-operatives, and how they could have provided a better model for dealing with the turmoil.

Two and a half years on, they seem more than ever like an attractive idea. And at first glance it seems good to see both the main political parties exploring their potential expansion, with Cameron and Osborne’s speeches today.

Philip Blond suggests that the economic debate just got interesting. But co-operatives in the public sector aren’t as radical as some are suggesting. Indeed, they aren’t as far removed from existing arrangements as many might think, as Hopi Sen points out today.

Thomas Haynes suggests the Progressive Left should support the new Tory interest in co-operatives. The Progressives meanwhile are busy distancing themselves, saying that Tories don’t grasp that co-ops are about involving the whole community, not just workers.

No one however seems to have addressed the crucial question of the values that underlie co-operatives. And in so doing they have missed their essence - the 'cooperative factor'.

For the Tories, it is still the profit motive (and the old ideology of separating from the state) that is driving them. As David Cameron said today in his ‘Never Voted Tory Before campaign speech’:

“So instead of government controlling every aspect of public service in our country, we would say to people who work in Job Centres, in the NHS, in social work, in call centres, right across our public sector......“here is your budget, deliver this service, and if you do it more efficiently and more effectively, you can keep some of the savings that you make.”

This is another way of introducing markets into public services. But the virtue of the not-for-profit sector cannot be simply rebranded and inserted into a profit-driven model.

There must of course be an element of self-interest that underpins the mutuality. But that can for example be in good and sound services, or safety. It can even be in steady, consistent and modest growth. But to base it primarily on financial interest would be its undoing – particularly in the public sector.

And the truly radical Government – and Labour have still to embrace this too - will be the one that tackles the private, not the public sector – specifically the housing market and financial services. These were two engines of growth over the last two decades, but also where the greatest risk was to be found. Co-operatives could provide the necessary consistency and safety.

But to do this a challenge needs to be mounted in these areas not just to the institutional forms – with the breaking up of banks and decentralisation of power important as these are – but to the very spirit that drives them. Labour show little desire for this kind of radicality. And whilst the Tories continue to champion co-operatives as an extension of ‘Right-to-Buy’ you can be sure they aren’t the ones to deliver it either.

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