Big Society in action: How does the co-operative instinct emerge in low-

income communities?

Anne Power

Professor of Social Policy

London School of Economics

A little personal history

• Tanzania, US, Holloway• Defining co-operation• Pooling resources to maximise shared

gains• Solidarity and reciprocity• Communities and government are inter-

dependent• Tensions can lead to positive outcomes

Human survival depends on co-operation

• Human beings are social animals• Evidence from pre-historic times• Progress accelerates through co-operation• We have moved far into

complex, competitive, unequal groups• But social, political, economic structures

unify societies• So are co-operative models relevant today?

Pre-historic co-operation

Meaning of Co-operation

• Bottom-up, member controlled, small scale

• Informal and formalised structures

• Multiple models emerge in:

– Complex modern economies –‘big government’

– Advanced fast changing urban communities

– Sophisticated private and public services

– Industrial as well as agricultural production

– Financial, construction, professions, care.

Viking Head Start

Danish HousingCo-operatives

Roots of modern co-operatives –Industrial revolution ‘shocks’

• Labour > wealth > shared unequally

• Powerlessness among masses

• Individuals at bottom group together

• Urgency of survival

– social protection, distribution of benefits, solidarity.

• Higher-level structures to tackle collective conditions

Industrial groups toiling ‘masses’

Conditions spawn ‘bottom-up’ groups

• Associations and clubs• Friendly societies• Mutual aid and self-help groups• Generates ‘bottom-up’ solutions• Co-operative producers, builders, retail• Proliferation of co-operative experiments• Rochdale weavers galvanised movement• Spread world-wide from UK

Rochdale Pioneers HQ

Alongside powerful social movements

• Public health bodies• Local government• Evangelical ‘chapels’• Trade unions• ‘One man one vote’• Women’s suffrage• Civil rights• Leading to ‘top-down’ systems• Building on ‘bottom-up’ demands

Early Social Movements

Co-operation advances human condition along many lines

• Pure ‘survival goods’ through collective savings e.g. food, clothes, tools

• Sanitary homes at reduced cost through collective building organisations (Spain, Scandinavia)

• Health, unemployment, death insurance (Italy)

• Education, learning (Denmark)

• Democracy, participation, voice (US Civil Rights)

• Shared work and shared profits (Basque)

• Savings investment for individuals and common good

Worker Owned Producer/Distributer

Martin Luther King, Jr. and the US Civil Rights Movement

Powerful ‘niche organisations’ work alongside government

• Health and social care – Italy, Belgium

• Housing – Spain, Scandinavia

• Retail – Britain, France, Spain

• Industrial production – Spain/Basque

• Architecture and engineering – UK/Arup

• Fisheries – Japan, West Africa

• Micro-credit – Grameen, Bangladesh

• Savings and insurance – worldwide

Fishing Co-op Co-op Kobe

Moroccan Bread Co-op

Torino

Porto Palazzo Market

Grameen Bank

Core principles of co-operation

• Open membership

• Democratic control – one member one vote

• Distribution of surplus value

• Limited interest on capital

• Political and religious neutrality

• Promotion of education

• Strictly limited borrowing

Open Membership

One manOne vote

The ‘divi’ Shared surplus

Unadulterated goods

No debt

Education

Conditions of success – inspiration

• Pressing, visible problems and acute need

• Common cause and unifying idea

• Clear targets for action

• Small early steps

• Trust – clear mutual benefits

• Reciprocity – elements of self-interest

• Shared gains

Vision – Mondragon

Conditions of success – organisation

• Leadership from within

• Organising skills and business development

• Ideas and access brokers

• Ideas and action planning

• System of member savings and investment

• Financial controls and probity

• Ground rules – mediating, resolving conflict

• Transparency

José Ormochea, founding member of Mondragon Co-operatives

Fagor factory, Mondragon – largest industrial producer in Spain

Co-operative organisations today

• Tenant co-operative and tenant management organisations

• Play-schemes, Nurseries

• Mondragon industrial co-operatives

• Employee owned services - Locke Fyne Oyster Co, John Lewis, Ove Arup

• Rapid expansion of Co-op Group since financial crisis

Co-operative Centenary

Co-op Group Booming

Community Fund

Deprived Council estates –unlikely co-operative enterprises

• Public landlord problems

• Tough conditions on ‘rough’ estates

• Steady revenue stream in rents

• Consultation or control

• Local knowledge and commitment prevails

• Local management and local budgets

• Local management saves money and creates jobs

• Hands-on, learnable skills and training

Tenant Management Organisations

Outcomes

• Higher tenant satisfaction

• Higher quality service

• Managing within budget

• Conserving scarce resource

• Better environments

• Higher rewards for effort

• Mutual gains

• Long-lasting community benefits

• Widespread model – Glasgow, Liverpool, London

Islington Fairness Commission

Lessons for government

• Complex public framework of support systems

• Essential in complex societies

• Welfare v. market

• Fair distribution of resources requires government

• How to BROKER community self interest and limit market failures

• Overarching framework of rules

• Community instincts useful and strong

• Training and ‘hand-holding’

• ‘Top down’ and ‘bottom up’

Big Society in Action