Chancellor Rachel Reeves has announced the creation of a Mutuals and Co-operative Council to lead growth in the sector.
Reeves (pictured) revealed this in a speech delivered at Mansion House on Thursday evening. The Mutuals and Co-operative Council includes Nationwide, Co-operative Group, Arla and Royal London, to double the size of the mutual sector.
The Chancellor also wrote to the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), asking them to produce a report on the landscape of the mutual sector.
She has asked for the report to be published before the end of next year to “aid the government and regulators’ consideration of how best to support this sector to drive inclusive growth across the UK”.
The Chancellor also announced a call for evidence, seeking views on “the merits of and considerations for changing the credit union common bond requirement”.
Speaking yesterday, Reeves said: “To support the mutual sector, we are launching our call for evidence on the credit union ‘common bond’ and asking regulators to report on the mutuals landscape.
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“And I welcome the work of Nationwide, Co-operative Group, Arla and Royal London to establish an industry-led Mutuals Council to drive growth in the sector.”
The council will be a forum for collaboration between the government and the cooperative and mutual sectors. It will provide technical expertise and offer innovative solutions for mutual ownership and control, based on observations across the UK and internationally.
Rose Marley, CEO of Co-operatives UK, said: “The power of cooperatives and mutuals to drive fair and sustainable growth has been overlooked by past Chancellors, but not now. Rachel Reeves has shown clear and practical intent to push forward cooperative solutions to some of the UK’s biggest challenges.
“As part of government’s commitment to double the size of the sector, the mutual council will create an opportunity to embed more mutuals into the economy; to create inclusive growth and an equitable future. We’re a step closer to a business environment that allows and encourages existing cooperatives and mutuals – businesses that do so much for people and communities – to grow and thrive.”
Marley added: “We believe the council will be a profound and impactful force that will feature in the long-term legacy of this government. We’ll be working hard to ensure the needs and aspirations of our members and the wider cooperative sector are covered. Together, we can build an economy centred on fairness, resilience, and inclusivity.”
Reacting to the measures, Robin Fieth, chief executive of the Building Societies Association (BSA), said: “I am delighted the Chancellor has used her first Mansion House speech to demonstrate the government’s commitment to double the size of the mutual economy by announcing a package of measures to support the growth of the sector.
“A strong mutual sector provides choice for consumers and creates resilience for the financial sector. When you’re with a mutual, you can be confident that the profits are reinvested in the business and the interests of members and communities, not hived off to external shareholders.
“We are very much looking forward to working with the new Mutuals and Co-operative Council as it begins this exciting journey.”
