The Business Council of Co-operatives and Mutuals today welcomed the announcement that the Senator the Hon. Zed Seselja will take on responsibility for the mutual sector within his portfolio of Assistant Minister for Treasury and Finance.
“We are delighted that the co-operative and mutual sector is now officially recognised within the Treasury portfolio,” said BCCM CEO Melina Morrison.
“Recognising the way in which co-operatives and mutuals add competition and economic resilience to the Australian economy as a whole is an important step to ensuring that these key institutions, which 85% of Australians are members of, can work towards a level regulatory playing field.”
Noting that he will also be responsible for charities and not-for-profits, the BCCM looks forward to briefing the Minister on a common misconception, by which co-operatives and mutuals are conflated with NFPs because of their social purpose.
“Co-operatives and mutuals are usually for profit organisations,” explains Ms Morrison.
“The difference between them and other types of for profits, like listed organisations, is that they exist solely to serve their members and customers. There is no third party shareholder expecting a return.”
“As such, they have helped many Australians build a livelihood and secure their future. Unlike the listed firms, co-operatives and mutuals have no need of a nebulous concept like ‘social licence’ to guide them in doing the right thing.”
“Co-operatives and mutuals prop up the Australian economy by helping small businesses scale, providing people with jobs in the regions, and reinvesting profits locally. Because they are owned by their communities, they keep benefits of economic activity close to home.”
The BCCM advocates for Australia’s 2,100 co-operatives and mutuals so that government and policymakers understand the member-owned business model. As a result of this work, the 2016 Senate Economics References Committee report into the contribution of co-operative, mutual and member-owned firms made strong recommendations to improve recognition and understanding of the member-owned sector. The 2017 Hammond Review affirmed the need for improved access to capital for co-operatives and mutuals and these recommendations will be assessed by Parliament later this year.
The BCCM looks forward to working with the Minister to reduce some of the red tape challenges still facing the sector and ensure fit-for-purpose regulation.