Is Cameron going to take the ‘public’ out of public services?

David Cameron’s co-operative proposal should be judged on its merits. But mutual solutions must empower parents, patients, pupils and service users.

Veteran stalwarts of the Co-operative Movement may not be able to stifle a wry smile after seeing the Conservative pledge to give public-sector employees the right to form worker co-operatives, as covered on Left Foot Forward yesterday. They would quite rightly remember that when in Government, the Conservative Party abolished the National Co-operative Development Agency, which during its ten years of existence created almost 2,000 worker co-operatives and 25,000 jobs in the private sector. Not to mention their gross act of economic vandalism in facilitating the demutualisation of more than two thirds of the building society movement when they were last in power.

But to be generous, as argued previously on this blog, we should judge Conservative proposals on their merits, rather than their past record. Yet another hastily improvised policy on the hoof has shown the Conservatives to be “completely clueless” on co-operatives. They don’t understand the great strides that have already been taken in public services, nor the underlying philosophy behind public sector mutualism.

Worker co-operatives and employee ownership do certainly have something to offer. Giving employees a stake in their business provides workers with economic gains and creates companies that are responsive to their frontline staff. Firms where members of staff have a big ownership stake and a say in decisions do not just cre­ate happier workers, they also make more productive businesses. These organisations thrive across a range of sectors, and can provide a better and more stable future for our economy.

But public sector mutualism is not just about giving workers power – but all of us, not just as employees – but also as parents, patients, pupils and service users. This is where the Government’s track record on mutualism speaks for itself. As a result of partnership between the Labour and Co-operative Parties over the last twelve years, there are more than 1.5 million members of new mutuals across public services. Largely, these are not just run by employees – but allow everyone involved in the organisation, be they parents, patients, workers or pupils – a real say over how they are run.

There are now 126 foundation trust hospitals with over a million members drawn from patients, employees, carers and the wider community. There are over 25 co-operative trust schools, with a target of more than 200 by September, which give parents, pupils and staff real control over the school and its ethos.

All of us want to see services built on the experiences of frontline staff, but they should be built on our experiences as service users as well – as they are at UCLH, my local hospital. Mov­ing to the mutual model has changed the way that it is run, making it more responsive to the community that I live in and more focused on the needs of its patients. It resulted in the creation of a ‘patient experience’ working group that draws on the experiences of employees and users to tackle issues like the quality of food and time spent waiting on the phone - all of which had been traditional sources of discontent, yet often too low down in managerial priorities to be tackled effectively.

It’s not impossible that employee co-operatives could do this – in much the same way as it’s not impossible for the state to do it either. But there is not the same mechanism for engagement with the community that allows it to build on the needs of users, as well as the frontline experience of staff.

One may want to ask David Cameron what he is going to do about the public sector mutuals that already exist. Does his new announcement mean that he is going to take our rights as patients and parents away from us and place them solely in the hand of workers? Is he really going to tell more than 1.3 million members of NHS Foundation Trusts that their services are no longer required?

Essentially when we’re talking about public money, it’s important that the public have a real say over how they’re run – and can make sure that public sector organisations are run in all of our interests,  rather than the narrow sectional interests of one stakeholder against the other.

And once you get into the detail of the proposals, they seem to get even murkier, with their avowed intent to allow co-operatives to go into joint venture with outside organisations, and give them a share of the revenues. While these proposals lack the specificity that one would expect from a serious political party, there is a concern that this could just be a route to enabling significant revenues to go into the hands of the shareholders of private businesses rather than being reinvested in providing a better service for taxpayers and users.

For over 80 years the Labour and Co-operative Parties have stood for giving economic and political power to everyone in our society, and employee ownership is an important part of that. But the mutual solutions that we proposed are based on the experience of a movement that has been around for 150 years, rather than the need for something to say to decontaminate our brand. If mutualism is going to be one of the key battlegrounds of the next election – progressives from the Labour Movement will have nothing to fear.

Our guest writer is Robbie Erbmann, Policy Officer at The Co-operative Party

UPDATE 11.45:

There’s an interesting critique of the Conservative plans at Stumbling and Mumbling by Chris Dillow, who has in the past argued for public service delivery by co-ops.