Communities and Local Government Committee - Mutual and cooperative approaches to delivering local servicesWritten evidence from ResPublica

1. Co-operative Councils should generate “asset effects” in communities. Not only should a genuine co-operative model deliver customer-oriented services, but also provide opportunities for the creation of shared ownership. Following on from ResPublica’s flagship report, The Ownership State: Restoring excellence, innovation and ethos in public services, Phillip Blond will indicate that the generation of assets should be the aim of co-operative councils and that service recipients should over time generate an equity stake. The questions set by the Select Committee imply that co-operative council be conceptually confined to outsourcing the public service delivery to not-for-profit businesses in which service users would not be entitled to any significant involvement leading to any tangible benefits. Simply transferring the responsibilities of a local authority to an employee-owned mutual risks either an “employees’ cartel” that has little interest in empowering the users or the creation of a purely private interest from public money.

2. For a true mutualisation of public services, local councils should facilitate the setting up of co-operatives co-owned and co-governed by the “producers” and “consumers”—the employees and users of the service. Without some sort of stake (financial or not) for service users, public service mutuals risk further empowering professionals who will always take the lead in deciding what is best for the communities. Service users would also become like the early co-operative “traders” who believe that “the more you trade, the more you earn”, so that long term users of a public service could generate a stake for themselves. Such an evolved relationship between the state and the citizens would truly empower the communities in planning and running services. There are some successful cases of public service mutuals operating like this overseas, including Spain, Italy and Sweden.

3. A genuine co-operative model would draw together both the “consumers” and “producers” of public services, and enable the users of services to participate in service production and delivery. The reciprocity a public service co-operative offers to its consumers could generate tangible economic advantages at local level when the profits could be distributed amongst members as dividends and/or recycled back to the communities to support further public services, resulting in a sustainable accumulation of social and pecuniary capitals and substantially reduced reliance of citizens on state-funded models.

June 2012

Prepared 6th December 2012