At last the government has given some detail on its idea for public-sector co-operatives.
Back in July, Francis Maude, minister for the Cabinet Office, made a plea for “answers on a postcard please!” to how mutuals in the public sector might work. Clearly, he received a bulging mailbag. The other week he announced 12 “pathfinder” pilot schemes: “trailblazing” public-sector providers who have decided to give mutual ownership a go. While the exact structure of each is unclear (they are, after all, experimental), they are united in the aspiration to be part employee-owned and/or employee-run.
The UK has traditionally been shy of such models. Their reputation took a bashing in the 1970s when Tony Benn recommended that workers in failing businesses formed co-operatives. Many of these came to messy ends – most notably Meriden, the erstwhile owners of the Triumph motorcycle brand, which spluttered to a halt as a co-op in only a few short years.
Yet that was then. We don’t have to look far for successful, long-lasting mutuals. We have our own John Lewis, of course. And Spain’s seventh largest business, The Mondragon Corporation, is a co-operative wholly owned by its circa 85,000 employees. It is actually one large co-op made up of around 150 smaller co-ops. Within the corporation, workers vote on key business decisions and an elected board is directly answerable to a workers’ committee. Research has found five times as many Mondragon workers feel involved in major decisions compared with equivalent private companies, and are much more engaged as a result.
Adapting such models to the UK’s public sector is, however, arguably very different. While a centralised bureaucratic system is an unruly beast, it is one beast. Would many separate and necessarily single-minded organisations create a whole jungle? We may have had social enterprises working on the periphery of the public sector for a while now, but they can be run with the same hierarchical ruthlessness as any private-sector company. Co-operatives and mutuals, with all the democracy and employee empowerment they entail, cannot. Would this slow the public sector down, or speed it up?
I’ve been working on a feature article looking at how established employee-owned mutuals and co-operatives throughout the UK run their businesses, and manage their HR – I’ll report back on that at a later date. But it has left me with many questions. Top of which is this: if this initial trickle of 12 public service bodies reforming as mutuals turns into a torrent, could it change public service provision as we know it?