March 2018

Ways Forward: Can public service mutuals
keep the co-op ethos in a competitive market?
The question of public service mutuals as a response
to austerity came under scrutiny at Ways Forward,
with delegates warned against “the marketisation
of co-ops”. A workshop, Co-ops, Solidarity and
Austerity Cuts, also heard from supporters of the
initiative, looking at examples such as the Preston
model of local procurement.
DEBBIE SHANNON
Debbie Shannon, from Link Psychology
Co-operative, described the “crisis” in public
services in the wake of the 2010 austerity measures.
When her educational psychologists department
was outsourced from the local authority it was
decided the co-op model “ticked all the options” in
terms of delivering social value.
From there she got involved in the Preston model,
with two prongs – targeting procurement to deliver
social value and support the local economy, a move
which kept £200m in the Preston area in 2015/16;
and forcing the growth of co-ops to fill the gaps in
supply chains of anchor institutions.
She said programmes like Preston face three key
tasks: creating infrastructure to support co-ops,
bringing about a culture change, and promoting the
idea of co-ops. “What is a co-op? People don’t know,”
she said.
Other speakers were more cautious about public
service mutuals. Cheryl Barrott, a member of the
national executive committee of the Co-operative
Party and co-director of Change AGEnts, warned:
“We need to make sure that co-operation is not
used to privatise the public sector.”
But, she added, the loss of expertise to the public
sector through job losses since austerity measures
began meant it would be hard to recreate the old
model, and in any case, “there is not the appetite
among the public to have a big, state-y sector”.
Which, she said, begs the question: “How do we
put the public back into the public sphere?”
Paul Bell, a national officer at public services
union Unison, was more sceptical. He said, as a
member of the Co-op Party and Midcounties, that
he was sympathetic to co-ops – but also that his
union was “in favour of in-house services”.
He said privatisation of public services always hit
the terms and conditions of the workers, adding:
“The big problem trade unions have with co-ops is
with public service mutuals.
“Under public procurement rules, after three
years, public service mutuals have to compete with
the likes of Capita and Circa and there’s a race to
the bottom. How does the co-op movement add
value to workers who want terms and conditions,
and social mobility?”
He added: “Mutualising the private sector is
better – we support that for Carillion, for instance.
“But the public sector is already co-operative
because we own it.”
CHERYL BARROTT
There was more criticism from Les Huckfield, a
former Labour MP who now works with Aizlewood
Group, which was formed to contribute to the
debate around public service mutuals and resist
privatisation within the public sector, specifically
in local government.
He said there had been a previous attempt to build
a public sector based around common ownership,
under the Labour government in 1976, which set up
24 | MARCH 2018