Nearly 30 years ago, a significant change to the Italian economy was quietly taking place. The then-Italian Minister for Industry, Giovanni Marcora, established a ground-breaking law with the aim of saving businesses and jobs across Italy.
Now known as the ‘Marcora Law’, it means that if a business is at risk of collapse, workers have the right to buyout all or part of the business with financial support and specialist advice from the government – with the aim of diverting the money spent on unemployment to retain jobs and continue economic activity within local communities.
In Italy, the results speak for themselves: between 2007 and 2013 alone, the law preserved hundreds of businesses previously at risk of closure as worker co-operatives, saving over 13,000 jobs. The change has paid for itself, with an economic return of over six times the capital invested by the government.
Worker buyouts like these are successful because, as the co-operative movement has always known, businesses work better when owned by those who know their workplace best and have the biggest stake in its economy. The buyouts ensure the new owners have a genuine say in the way things are done and can prioritise sustainable, long-term success over quick, short-term financial gains.
But this isn’t just about saving jobs. Like the Co-operative Party has long argued, businesses operating with a co-operative business model are more equitable and share wealth more fairly. In closing the gap between rich and poor, they have a transformative effective on our economy as a whole. By widening ownership through initiatives like the Marcora Law, we can build an economy that is more inclusive, more equal and reduces inequality – giving workers a real stake and say in their businesses.
The UK can learn much from this Italian initiative. That’s why on Tuesday I’ll be introducing my ten-minute rule bill in parliament with the aim of introducing our very own version of the Marcora Law, to give workers the opportunity to buy their failing or at-risk businesses with government support.
Calls for changes in our economy through employee ownership are widely supported. In Wales, for instance, the Welsh parliament recently passed a motion (introduced by my colleague Huw Irranca-Davies MS) in support of increasing the number of employee-owned businesses and seeking to introduce a similar law in Wales.
At a time when our economy has been dramatically and devastatingly impacted by the pandemic, a law like this has never been more important. By widening ownership, we have a real opportunity to rewire our economy so it works in the interests of communities, workers, consumers and the environment – not distant shareholders. A UK Marcora Law would be an important step to ensuring we do just that.