Co-operative and Mutual Societies (Capital) Bill - Clause 1

The Bill seeks to protect mutual capital for its intended purpose by introducing legislation that recognises the value of legacy assets, which are often distributed in demutualisation. This preserves the integrity and identity of co-operatives, ensuring they remain focused on providing goods and services rather than profit-driven motives. Mark Hendrick argues that such measures have been adopted successfully in other countries to maintain robust mutual business sectors.

Congratulates the hon. Member for Preston on his Bill's successful Committee stage and its reach to Third Reading, highlighting that mutuals are a significant part of the UK economy with over 7,000 co-operatives employing around 250,000 people. Emphasises the historical importance of mutual insurers and friendly societies as social safety nets. Acknowledges the decline in mutual organisations but notes scope for growth and welcomes comments on increasing competition in the insurance market to support mutuals. Supports the Bill's changes allowing Treasury regulations to bring legal restrictions that protect legacy assets, making it easier for mutual societies to compete with commercial rivals.

Commends the hon. Member for Preston on his advocacy and progress with the legislation, highlighting that mutuals are owned by their members who control decisions, focusing on long-term sustainability rather than short-term profit distribution. Acknowledges the role of co-operatives in local areas, providing services such as education, engagement, charity, and financial services. Supports the growth of co-operatives for job creation and tackling issues like decarbonisation and cost-of-living challenges. Mentions historical significance in Stoke-on-Trent with James Colclough's co-operative store. Emphasises that the Bill ensures legal certainty that wealth will not be squandered by future members, encouraging confidence and reassuring investors.

Emphasises the importance of co-operatives as part of a vibrant free market economy, celebrating their role in bringing greater choice to consumers and people who need goods and services. He supports the opt-in nature of the Bill and highlights its significance in protecting assets when organisations face closure. Cites examples from his constituency such as Buckinghamshire Community Energy company and Brill Village Community Herd, illustrating the diverse impact of co-operatives.

Intervened to ask about the resilience of financial services in 2008 if more mutual building societies had been retained, questioning whether a greater diversity would have made the sector more financially resilient.

Highlights the importance of enabling co-operatives to raise capital and compete with corporate entities while retaining democratic structures. Acknowledges the historical significance of the Rochdale Pioneers in founding the modern co-operative movement, citing examples from his constituency such as Co-op retailers and insurance services.

Congratulated the hon. Friend on his Bill, highlighting its cross-party support and Government backing. Emphasised the resilience of co-operatives during the pandemic, noting their combined turnover of £40 billion and 235,000 jobs created. Quoted US data showing higher productivity in employee-owned firms. Criticised outdated legislation for hindering growth and compared UK to Germany and Italy where co-operative economies are more prominent. Raised concerns about demutualisation and supported provisions that maintain mutual capital.

The hon. Member for Arundel and South Downs supports the Bill, highlighting its alignment with the Government's financial inclusion agenda. He emphasises that mutuals are uniquely invested in serving their members rather than seeking short-term profit, making them key partners in various policy priorities. Griffith also discusses the importance of maintaining voluntary elements within the co-operative movement, allowing organisations to adopt an asset lock if they choose.