UK Labour landslide set to benefit co-ops and mutuals

05 July 2024

With exit polls pointing to a landslide victory to Labour in the UK elections, Melina Morrison, Chief Executive Officer of the Business Council of Co-operatives and Mutuals (BCCM) explains what this means for co-ops and mutuals.

“The election of the Labour Party in the UK represents a game changing opportunity for the co-operative and mutual sector to grow and underscores its ability to bring diversity and innovation to the economy.

Labour’s manifesto pledge to double the size of the UK’s co-operative and mutual economy by working with the sector to address barriers that have had a limiting effect on the growth and dynamism of the UK sector is a powerful inspiration for what might be possible in Australia. It positions co-ops and mutuals as key contributors to renewed plans for economic growth through diversity of corporate form and reinforces the importance of customer focused businesses. Recent Legislative reforms disincentivising the demutualisation of co-ops and mutuals in the UK had built confidence that the sector was match-fit for a more muscular era of growth and expansion. Australia should adopt these reforms as soon as possible building on the unprecedented access co-ops and mutuals now have to growth capital here.

Co-ops and mutuals – which do not have shareholders – exist for the benefit of their members and play an important role in helping to stimulate competition in the interests of consumers in tightly held markets. In Australia, the pitfalls of concentrated ownership are currently playing out in lack of choice and higher prices for consumers in some of the world’s most profitable markets like supermarkets and banks. Co-ops and mutuals add to business diversity and help to provide a competitive spur to the economy, providing more choice for consumers at the check-out.

As a sector, we continue to advocate for measures that help co-ops and mutuals deliver value to consumers and help Australian smaller businesses and suppliers to compete in concentrated markets. The Better Competition Better Prices report from the recent House Economics Standing Committee inquiry into promoting economic dynamism and competition highlighted the value that co-ops and mutuals can play in a diverse economy.

We look forward to working with government on a regulatory framework that ensures a level playing field for different corporate structures including co-ops and mutuals. We reiterate our call for the creation of a dedicated Minister for co-ops and mutuals and legacy assets protection, as in the UK, in order to ensure the sector is able to live up to its potential as a powerful economic contributor.”