Through co-operative models, Britain’s economy can be transformed

In cities across the UK, local communities are starting to do things differently. Tired of waiting for Whitehall to reverse damaging cuts to local budgets, and of competing with neighbouring regions in a race to the bottom to incentivise big business to set up shop, councils are using the resources they already have to grow a genuinely inclusive economy.

Our new publication, six steps to build community wealth, will be launched at our Local Government Conference this weekend. It seeks to provide the tools for the hundreds of Labour & Co-operative councillors across the country to transform the regions they represent, by reorganising local economies and supporting communities to help themselves.

We at the Co-operative Party are putting forward a new approach to regeneration, learning from cities like Preston and Manchester to put forward a model for local growth built from the co-operative values of self-help, participation, social responsibility and democratic accountability. Local organisations should be playing a greater role in creating and retaining wealth locally. And, as democratic, member-owned organisations, co-operatives must be at the heart of the new way of working – creating high quality local jobs and sharing profits with workers and the local community.

As London and the South East account for 38 per cent of the UK economy, a new approach to growth in every region has never been more important. Deindustrialisation has created economies indifferent to people and place, where our manufacturing heritage outside the M25 has been replaced by call centres and warehouses. Investment in jobs and growth by business is too often only secure when things are on the up, or until the service is cheaper to provide elsewhere.

This was starkly felt in Preston when, in 2011, a £700m investment in a new shopping centre fell through when one of the businesses withdrew their support. Meanwhile, central government cuts meant the council’s hands were tied as they worked to tackle the lack of available local jobs and rising inequality.

They realised that a new approach was needed – relying on big business and central government had failed to deliver the regeneration and jobs that local communities needed.

In collaboration with the Centre for Local Economic Strategies and local “anchor” organisations with a stake in Preston – from the police to the local university – the council have been pioneering a new approach to local regeneration. Instead of waiting for others to spend money locally, the council and its partners are changing the way they buy goods and services so that their spend stays in the local economy, supporting local businesses and creating local jobs. Where there are gaps in the market, the council are supporting new and existing co-operative enterprises to start up, grow, and take on anchor organisation contracts.

Already, over £10 million of public contracts have been awarded in Preston and the surrounding areas. For example, Conlon Construction, a local family owned business, hired new local staff and apprentices when they won the contract to build a new covered market, while local farmers benefitted from the council procuring fresh canteen food locally.

But Preston aren’t alone in taking an innovative grassroots approach. In Manchester, the council has helped to create 5,000 new jobs by changing the way they buy goods and services. Labour & Co-operative-led Glasgow created a co-operative development unit which gives transformational support and grant funding to co-operative and social enterprises. The Co-operative Party is looking forward to working with many more councils and local representatives to roll out this approach in every region.

Anna Birley is the Co-Op’s policy officer and a councillor in Lambeth