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Invisible in literature – are co-operatives boring? 21 June 2020

Posted by cooperatoby in cooperative, Social enterprise.
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Co-operatives are undoubtedly a good thing, and they are quite simple in principle, so why is it that they figure so rarely in works of fiction? It may be because they are so peaceable, uncontroversial and scandal-free. When I worked for the UK’s federation of worker co-operatives, ICOM (the Industrial Common Ownership Movement) in the 1980s it was a commonplace that co-operative law was so simple because co-ops rarely went to court. There was precious little case law because co-ops rarely litigated. That explained why company law was long-winded while co-op legislation was short and sweet. Even today, people sometimes find a business based on sharing more “complicated” than one based on exploitation. Maybe they think it’s just too good to be true.

Successful yet boring

In 2018 the Health Bank made the same point:
The new World Cooperative Monitor 2018 has been published and shows the ranking of the 300 largest cooperatives in the world. The International Cooperative Alliance (ICA) and the European Research Institute on Cooperative and Social Enterprises (Euricse) have published the seventh annual World Cooperative Monitor. That is 2,575 companies from 8 sectors of activity, of which 1,157 generated sales of more than USD 100 million. The top 300 cooperatives and insurers report a total turnover of over two billion USD. US dollars. The response to the study in the media? Almost zero. Unless one is involved in a scandal, cooperatives are the unloved stepchildren of the media and are ignored. Wrongly so. Because cooperatives are a success story.

Quite. Work done co-operatively, by harnessing intrinsic motivation, is so much more enjoyable!

Yet it seems sadly to be true that authors find little to inspire them in co-operatives. I’ve recently been reading Ken Follett’s Century Trilogy and was happy to find he mentions their role in working-class life during the First World War in its first volume, Fall of Giants:

‘Where’s our mam?’
‘Gone down the Co-op for a tin of jam.’ The local grocery was a co-operative store, sharing profits among its customers. Such shops were popular in South Wales, although no one knew how to pronounce Co-op, variations ranging from ‘cop’ to ‘quorp’.

Apart from this, references are mainly humorous. In Murder in the Collective, Barbara Wilson sets a murder mystery among radical printing collectives in Seattle, and Frances Madeson’s 2007 comic novel Cooperative Village is set in the eponymous housing co-op in New York.

Surely this can’t be the whole story?

References:
Follett, K. Fall of Giants, 2010, Pan Books, London, ISBN 978-0-330-53544-1, p. 487
Madeson, F. Cooperative Village, 2007, Carol MRP Co, ISBN 9780979277207
Wilson, B. Murder in the Collective, 1984, Seal Press, Seattle. ISBN 9781878067234

Co-design webinar for the Social Economy Action Plan 2 June 2020

Posted by cooperatoby in social economy.
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On 2nd June 2020, over 400 people met online to co-design the European Action Plan for the Social Economy, at a webinar organised by the European Parliament’s Social Economy Intergroup and chaired by Victor Meseguer of Social Economy Europe. They heard Commissioner Nicolas Schmit call for the European economy to be reshaped.

Green MEP Sven Giegold expressed the Intergroup’s disappointment with the lack of progress made under the last Commission mandate, and called not for symbolic actions, but real changes to budgets and regulations. He set out some important concerns:
• Help for worker buyouts, on the model of the Italian Marcora Law
• Support for fair trade, which is not a threat to fair completion but the basis of it
• Social procurement
• Equal treatment for social economy legal forms and private firms
• Usable statistics from Eurostat
• Statutes for the European association, mutual and foundation – currently, to receive donations charities have to set up a foundation in each different Member State

Perhaps no European legal status

Commissioner Nicolas Schmit found himself in the happy position of being no longer a member of the Intergroup, but its principal interlocutor. He promised that the ESF will continue to support the social economy, including a tool to enable transnational projects. He agreed that the social economy needs European recognition, but “perhaps not a legal status”. Pointing out the funds available through EU-Invest and the Recovery and Resilience Facility, he said we should “use the crisis to reshape the economic system”.

Yolanda Díaz, Spain’s Minister for Labour and Social Economy, outlined Spain’s Social Economy Strategy, which is to be renewed for 2021-27 and implemented in partnership with CEPES. She is also the chair of the Monitoring Group of Luxembourg Declaration on Social Economy, which brings together 16 EU Member States. In the second half of 2020 the European capital of the social economy will be Toledo, and the policy focus will be on social and economic development, social innovation, sustainability, depopulated areas, Latin America, satellite accounts and response to the pandemic.

Heather Roy from Eurodiaconia noted that social economy enterprises need support now, if they are to survive long enough to help recovery from the crisis.

A series of other speakers from regional and local authorities, sectoral and financial bodies and the European Parliament also contributed.

Zooming can be fun, as well as more democratic 9 May 2020

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I’ve just taken part in AEIDL’s first online AGM, and I have to say it worked very well. We used Zoom, of course, with the added polling feature. As far as I can see, surprisingly it made the meeting more, not less democratic.

First, it made our democracy more accessible: people attended who normally cannot, and we had 24 of our 31 members there. This is probably a result of it being so much quicker (2 hours) and cheaper, as there are no travelling and no travelling expenses.

Secondly, the discussion was more organised: there was very little interruption – most members muted themselves by default, and you can ‘put your hand up’ on the screen if you want to speak. At the same time the chat feature allows you to comment in real time when the oral debate continues. During our AGM, 4 big ideas cropped up, which Luca harvested and reported back on at the end. In this way, I think it actually increased interactivity, by allowing us to intervene more often, but without having to interrupt the current speaker. In a physical meeting, you have to postpone your comment, and by that time the moment has often passed. In future we could use breakout rooms, to allow small groups to discuss an issue in parallel.

Quick votes

We found the polling feature worked very well when we had to vote: it was more-or-less instantaneous as well as being transparent (though anonymous), with the result clearly displayed as a percentage bar-graph of yesses, nos and abstentions.

On the negative side, you undoubtedly lose the excitement of having a day out of the office, foreign travel, meeting people socially, eating together, and serendipitous learning and ideas.

And our success relied on meticulous preparation (thanks Jean). Even with the agenda and slides on the shared screen, participants have to take care to download and study the necessary documents beforehand.

Handbook

When the ESF Transnational Platform (RIP) started up, both we and the Commission expected online meeting to be popular. But this never happened, with fewer than 10% of Thematic Network meetings taking this format. In retrospect this was a great shame, as it could have increased the breadth of participation and learning. If it’s any help, we published a guide setting out some guidelines and handy formats for meetings and webinars.

For me, the whole experience went so well that I am minded to propose that we hold virtual general meetings more frequently.

The coronavirus and its aftermath 28 April 2020

Posted by cooperatoby in Amsterdam, social economy, Social enterprise.
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I’ve been wondering when and how anyone will take the lead in formulating local development/social economy proposals for a better post-coronavirus world. Here’s a start.

Personally, as a seasoned home worker, predominant introvert, in receipt of a pension and with neither children nor parents to care for, I have been affected remarkable little by the coronavirus crisis and consequent lockdown measures. Marooned in Amsterdam, I’m free to read books, listen to the BBC’s In Our Time archive and binge-watch TV detective series. We can go for walks and bike rides, and have seen the family a couple of times (keeping a 1½-metre distance). There are no grocery shortages, just stripes on the shop floor and perspex screens at the tills. We have to forgo cinemas, pubs and our weekly expedition to the Balti House. Yesterday’s Koningsdag was humorously converted into Woningsdag or Balkoningsdag.

But for the moment the local neighbourhood co-op has suspended activities apart from its phone helpline. It will celebrate Liberation Day through online stories.

What are the likely medium-term consequences of the crisis? How are local development precepts important?

When it all blows over, I think we can expect a number of social-economic changes to persist:
• More home working (hot-desking, non-renewal of office leases)
• Staggered school and working hours
• A swing towards online commerce
• Animated films will replace live ones
• An aversion from crowded public transport. As more commuting by car is not an option, cycling will rise (woonerven)
• More concern for food security (blocked international supply chains, shortage of migrant farm labour)
• A desire for more food self-sufficiency (fear of transmission from intensively famed livestock; Ecolise)
• A swing to responsible and cultural tourism (dearer flights)
• More support for degrowth, but on the margins
• Fewer hugs and bises?

Organisationally we risk less informed debate and less democratic accountability. Annual general meetings and parliaments meeting online cannot exercise the same level of scrutiny on managers and governments. Investigative journalism is needed more than ever, but newspaper sales and advertising revenue have slumped even further.
Politically I think we shall see stronger support for solidarity-based public services, above all health services. Along with this a recognition of the essential worker status of many disrespected and underpaid professions, from nurses to bus drivers and street cleaners, and an upward re-evaluation of the value of immigrants, who ensure public services and food supply (MAX).

But I doubt that we will see a fundamental change in power relationships. Just as with the financial crisis of 2007-08 this current period of Keynesian expansion will rapidly be replaced by a return to austerity. Already it is benefiting billionaires disproportionately (Amazon, Netflix).

It’s the perfect time to move to a universal basic income (UBI), which would not only reduce poverty but open up scope for myriad local voluntary initiatives. Some of these might be developed into community enterprises – for instance in urban horticulture or bike couriering. Platform co-ops will come into their own to support and connect microenterprises. AEIDL needs to find and promote the best ways of supporting transnational distance networking (ESF-TP).

Employment Commissioner Nicolas Schmit has just written to EU member states recommending increased support for the social economy, so the political cog wheels are starting to turn.

Cheesy social enterprise 26 April 2020

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Who knew that Primula processed cheese is made by a social enterprise? Its factory in Gateshead was featured in the BBC’s fascinating series ”Inside the Factory”. It is a subsidiary of the Norwegian Kavli Group, whose profit goes to the Kavli Foundation (Kavlifondet). In 2018 group turnover was NOK 3.5bn, and the foundation received NOK 100m (€8m) in dividend and distributed NOK 131m (€11.4m) to research, culture and humanitarian causes. Kavli UK employs 241 people and includes Primula, Castle Castle MacLellan pâté (Kircudbright) and St Helen’s Farm goat milk (York).
It is not to be confused with the similarly-named Californian Kavli Foundation.

The Commission’s 2019 mapping study identifies only 295 social enterprises in Norway, 11% of which are foundations, but admits that this is a minimum and that there may be more under the radar. This is clearly one of them!

Council definition of social enterprise – an asset-stripper’s charter? 23 March 2020

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I notice that the European Council has brought into being yet another practical definition of ‘social enterprise’ – all the while of course refusing to do so officially.

This one appears in the mandate it gave to the Commission to negotiate ESF+ with the Parliament. It reads as follows:

2.1(15) ‘social enterprise’ means an undertaking, regardless of its legal form, or a natural person which
(a) in accordance with its Articles of Association, Statutes or with any other legal document that may result in liability under the rules of the Member State where it is located, has as its primary social objective the achievement of measurable, positive social impacts rather than generating profit for other purposes, and which provides services or goods that generate a social return, and/or employs methods of production of goods or services that embodies social objectives;
(b) uses its profits first and foremost to achieve its primary social objective, and has predefined procedures and rules covering any distribution of profits that ensure that such distribution does not undermine the primary social objective;
(c) is managed in an entrepreneurial, accountable and transparent way, in particular by involving workers, customers and stakeholders impacted by its business activities;

This makes two new interpretations:

– firstly that a social enterprise can be a natural person (i.e. an individual rather than a group)
– secondly that it replaces the presumption that any profit distributed must be less than half of any profit made with the constraint that it does not “undermine” the social mission.

This seems to have difficulties:
– how can a natural person – i.e. a sole trader – have a “legal document” with a social objective?
– how can one verify that a profit distribuion undermines the social objective? Probably this could only be said to have happened when the enterprise fails – in which case it is too late.

So the Council seems to have learnt nothing about profit and asset locks and removed any protection against asset-stripping of social enterprises.

Reference: ESF+ Regulation – Partial mandate for negotiations with the European Parliament – COM(2018) 382 final – doc. 9573/18. https://data.consilium.europa.eu/doc/document/ST-8211-2019-INIT/en/pdf

Social innovation is political 17 February 2020

Posted by cooperatoby in social economy, Social enterprise, social innovation.
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At the DIESIS strategy day on 11 February, I chaired the world café tables on social innovation, and wanted to go beyond the standard discourse.
The social innovation project is a worthy attempt to transfer the glamour traditionally attached to technical innovation to the social policy field. And the transfer of innovative methods is what gives the EU the competence to intervene. But what underlies it?
The usual definition is phrased in rather technical terms:
• social innovations are new (in their context) social practices that aim to meet social needs in a better way than existing solutions. They are innovative in method as well as results – i.e. they create new relationships;
• They tend to be hybrids of existing elements, rather than completely new, and to cut across organisational or disciplinary boundaries;
• They can be launched by anyone – government, research institutions, companies, professionals, NGOs, the social economy…
• Their crucial feature is that they let new actors in. They empower and strengthen civil society, and therefore increase the effectiveness of change.
Some examples are open universities, social co-operatives, microcredit, fair trade, Wikipedia, community planning and architecture, carbon trading and socially responsible public procurement.
But it’s also important to remember that there are also what might be termed ‘antisocial innovations’ such as the privatisation of public housing: this certainly changes social relations and empowers tenants – but it correspondingly disempowers the homeless who will never get a council house.
Therefore we should remember that social innovation is essentially political – it aims to make everyone winners, but it may also have losers. This is especially the case for so-called ‘disruptive’ social innovations. Disruption sounds grand, but Uber’s gamble that it can dismantle public transport and replace it with its own monopoly is scarcely a progressive step.

Social enterprises are how we sustain social innovation

A second political angle is the suspicion that social innovation is a cloak for public service cuts, a way for governments to shuck off their responsibilities and force citizens to solve social problems themselves. I don’t really buy this – people have a natural desire to improve their societies, and public policy should give them ways to do this. The crucial role of the social economy is that it is the only way of making social innovations economically sustainable. If they don’t have a ‘business model’ then they will forever be controlled from the top down. Social enterprises are the vehicles through which citizens can directly control their living and working environments.

Thirdly, we should avoid digital capture. Not all social innovation is digital. One can certainly use digital methods to bring people closer to power – see the example of Simba’s Comme à la Maison (CALM), which links up migrants with offers of accommodation. By the essential point is power, not technology.

Finally, the pot of gold at the end of the social innovation rainbow is ‘transformative’ social innovation, which not only introduces new approaches to seemingly intractable (‘wicked‘) problems, but also changes the social institutions that created the problem in the first place. It’s slow and requires capacity for multiple partnerships and engaging policy, legal and economic institutions.

Comment now to influence the EU’s Social Economy Action Plan 17 February 2020

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At a strategy day held by DIESIS on 11 February, Risto Raivio of DG Employment set out the state of play with the EU’s Social Economy Action Plan, which was added at the last minute to Commissioner Nicolas Schmit’s mission letter last December.

The SEAP will be cocreation with stakeholders according to the following timetable:
• 2020: evidence (GECES meets April & September)
• 2021 1st half: drafting
• 2021 2nd half: launch

As it currently stands, the plan’s content will be structured as follows:

Social economy & social enterprises:
• civic engagement
• local communities
• labour market integration
• social investment
• local green deals
• social innovation – innovative solutions in: education, healthcare, energy transition, housing, social service delivery

It will fit into the policy framework including the 14 Jan 20 communication on just transitions, the Green Deal, the SME and industry strategies, the skills agenda etc. The study on the impact of the Social Business Initiative will be published in Oct 20 in time to feed into the SEAP.

There is an opportunity to input your views NOW, since there may not be a separate consultation on the SEAP. You can take part in the consultation on further implementation of the Pillar of Social Rights before 30 Nov 20 at https://ec.europa.eu/social/main.jsp?catId=1487.

My favourite tramlines 12 February 2020

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  1. The Lisbon 28. 
    Lisbon is a paradise both for the vehicles (with controllers marked ‘Wolverhampton 1904’) and the crazy switchback routes. The 28 winds up the hill from Rua do Conceição in Baixa past the cathedral and up to the viewpoint above Alfama at St Tomé. The viewpoint is also a squeezepoint, with 4 tracks converging into a single one [photo] as the 12 and 28 diverge. Trams chase each other like something out Indiana Jones’s Temple of Doom. Just after the fork the 28 squeezes along a street so narrow the tracks have to interlace with each other, penetrating the maze where no bus would be safe. It’s great that Lisbon has now realised what an asset its trams are, and in 2018 persuaded the operator Carris to reopen part of line 24. Further extensions are planned. See Wikipedia for an excellent historical map.
  2. San Francisco Powell-Mason cable car.
    Whoever moved heaven and earth to preserve this line were geniuses. It must be one of the city’s biggest tourist magnets. It’s a unique technology, powered by cables running in ducts under the road at a steady 9 mph. At the termini, the cars are rotated on hand-pushed turntables. An arcane problem arises where the line intersects the California St line while going up a steep hill. How do you keep grip on the cable when another cable is crossing at right angles? The solution is that the line makes a shallow dip as it crosses California, and as the car approaches the crossing, the ‘gripman’ driops the cable, coasts across the junction and then picks it up again. This must require iron nerves and immaculate timing. You can see the giant cable drums and tensioners that power the system at the Car Barn near the junction of Mason and Washington Streets.
  3. I can’t leave out the Brussels 81, on which I’ve been commuting on and off for 34 years. Nothing modern about this line, which describes a semicircle round the southern side of the city centre, connecting working-class areas of St-Gilles and Etterbeek with Midi and Merode stations. In its central section, it winds through narrow streets, some cobbled, and dips into tunnel, but at either end gets room to breathe in a central reservation. I think it has only survived because it forms the only link above-ground link between the eastern part of the network, including the Woluwe tram museum, and the city centre. It’s therefore a good place to see (and hear) museum trams. A curiosity is the looping figure of 8 tracks that connect its Montgomery terminus with the 39/44 tracks to Woluwe. Over the last few years, STIB/MTUB has had the spare vehicles to intensify the timetable, and the line has got much busier. Stops have been moved and lengthened so that it can accommodate the 43-metre low-floor Flexities. So it’s now a viable inner-city ring line. But it also encapsulates the soul of the city, and at one time had a community newspaper named after it.
  4. A total contrast is Amsterdam’s line 26, the IJtram. Built in 2005 as the lifeline of the new suburb of IJburg, an archipelago of artificial islands in the IJsselmeer east of the city, it was originally going to be a metro, and has express characteristics – it runs at up to 70 km/hr, on reserved track of course, and has widely-spaced stops. It’s the only tram in town that will carry your bicycle. As IJburg has grown, capacity has had to grow to match, although nowadays you can also escape from IJburg by a bus connection at its eastern end. Peak headway is now every 3 minutes, and in 2020 GVB plans to introduce coupled sets. At Centraal station it has two alternative terminal loops – the normal one at the front, and an emergency one on the IJ side, just underneath the new Eurostar terminal.

Amazon-offsetting – how about a 1.5% self-levy? 20 November 2019

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One of my friends just told me she buys a lot of stuff from Amazon, but feels guulty about it because they pay so little tax. The growth of online shopping is causing our high-street shops to close and our city centres to die. This has just come up as an election issue in Britain, with city-centre retailers complaining they pay higher business rates than out-of-town warehouses. As well as urban liveability and inclusive access, there is also an environmental issue as shopping and deliveries switch to fleets of vans, but it’s difficult to estimate the net effect.

We can however do something about the tax shortfall. In 2016 and 2017, Amazon made sales of €46,500m in the EU, and paid a measly €71.5m in tax, which is 0.15% of sales. Given that the top 20 FTSE companies make 8% of net income on sales, then we can estimate Amazon’s ‘hidden’ profit at €3,720m. The €71.5m they paid amounts to about 1.9% of profit. If they had paid (for example) UK corporation tax of 19% on that, it would be €707m.

If we buy something worth €100, Amazon might be thought to have made a profit of €8. They ‘ought’ to pay corporation tax of €1.52, but have actually been paying €0.15. There is a shortfall of €1.37 on each €100 of what we buy.

So if we wanted to make up for that, we could simply impose a levy on ourselves, offsetting the damage in the way we do with carbon dioxide, and pay the €1.37 direct to the tax authorities. It’s letting Amazon off the hook, but until the EU tackles tax evasion seriously, it might satisfy our consciences.

NB This post was amended on 21 Nov thanks to a correction from Michiel de Jong. I had miscalculated the tax shortfall as €1.51 rather than €1.37 per €100 of purchases.

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