Staying True to the Mission
I am a big fan of consociationalism – the politics and society of coalitions to you and I - having really fallen for it in the late 1980s. It is, for example, a big part of what makes Switzerland such a vibrant and civilised country and a key ingredient in the current transition towards peace in Ireland. However it does bring its contradictions from time to time, as different partners within coalitions strike compromises and make allowances for each other’s behaviour.
And that is where we are with Government policy towards employee ownership in the UK at the moment.
On the one hand, and very positively, Government has just sponsored the first meeting of the Employee Ownership Implementation Group Chaired by the responsible Minister Jo Swinson MP, to implement, amongst other things, the recommendations that came out of the Nuttall Review. I am very pleased to be part of that Group and the commitment of the Minister and her civil servants under the auspices of that Group to making measurable progress on growing employee ownership in the economy is there for all to see. It is hugely appreciated. On the other hand, the Government is pressing ahead with its Growth and Infrastructure Bill that contains in Clause 23 a proposal to adopt the term ‘employee owner’ that is already commonly used and widely understood across the UK (including by Government) to mean something else, and to redefine it as a model in which worker rights on such matters as redundancy and unfair dismissal are removed, in return for tax breaks on small shareholdings they might own in a business in which they work.
This now infamous proposal besmirches the good name of employee ownership and the thousands of employee owners who are already key players in the economy. It ignores all the advice Government has received in recent years about how to grow the number of employee owners in the UK. There is no need to dilute the rights of workers in order to grow employee ownership and there is no data to suggest that doing so would significantly boost the number of employee owners. Indeed all of the evidence is that employee ownership in the UK is growing, and the businesses concerned thriving, because they enhance not dilute the working conditions and entitlements of employee owners. Furthermore, the return on investment in terms of numbers of employee owners created would be dramatically higher if the estimated (officially by Government) £100m of cost associated with this proposal was more wisely invested in initiatives to increase employee ownership in the UK. As I have been rather fond of saying recently this policy sits much better with the Flat Earth Society of Samuel Shenton than it does with the Big Society!
But just because the politics of coalition sometimes throws up odd behaviours does not mean we have to accept them. The Employee Ownership Association in close collaboration with our members and other partners is working relentlessly to get this legislation altered to remove the references in it to ‘employee owners’. Current momentum is good and together we have a better than even chance of achieving our goal particularly now that the Government has announced an intention to at the very least bring forward an amendment to the Bill to change the wording from ‘employee owner’ to ‘employee shareholder’. You can read more about what we are doing on this issue and how you can help here. Conveying the voice of existing employee owners remains critical in this debate.
And whilst we are on the subject of these employee owners I would like to take this opportunity to repeat my congratulations to all the individuals and organisations who were nominated for and/or received commendations in or were category winners in the recently announced Baxendale Awards that we host each year as the curtain raiser to the EOA Annual Conference. I was delighted to be on the judging panel for the Awards and very moved to see the sheer delight on so many faces of the winners during the Awards ceremony.
A number of those winners are organisations that have are employee owned public service spin outs operating in parts of the health economy that used be owned and controlled by the state. And mentioning that allows me to highlight a current piece of policy work the EOA is engaged in that is a real eye opener. In a very welcome move the Department of Health, through a body called Monitor, is running a consultation on whether competition between such spin outs and others in the health sector is fair. The EOA’s formal written submission to Monitor on behalf of our Members is available here. Broadly it has two things to say. Firstly, that the landscape is demonstrably unfair for many of our Members. Secondly, that as a direct consequence, an astonishing amount of money is taken away each day from the delivery of front line services to some of the most vulnerable people in our communities. Again rest assured that we will be striving hard to influence this agenda in the weeks ahead.
Finally for now let me conclude with a couple of things that are fundamental for all of us who are interested in employee ownership in the UK. Employee ownership is currently growing at an annual rate of around 10%. Interest in it within business communities is increasing daily. The number of funders and advisors competent to engage in employee ownership is on the rise. Support for employee ownership across the party political spectrum is considerable. And most importantly of all the successes of employee owned businesses and organisations out there in the real economy continue to impress. These are exciting times and they are unprecedented.
So let us stay focused on the positives, build on this momentum and stay true to our mission – 10% of UK GDP delivered by employee ownership by 2020.
Iain Hasdell is Chief Executive of the EOA
Check out our recent research “Fit for work” on health and well-being in employee owned companies.