Co-operatives Bill to cut red tape and help to build a fairer economy

The Prime Minister yesterday (January 19, 2012) announced plans to cut the red tape associated with co-operatives so members can share the benefits.

The legislation, which should ensure that even more co-operative members share in the benefits of enterprise, will be put before parliament before the next election according to David Cameron.

Announcing his intention in a speech yesterday, the PM said: "We know that breaking monopolies, encouraging choice, opening up new forms of enterprise is not just right for business but the best way of improving public services too.

"But right now there are too many barriers in the way... so today I can announce they will all be brought together and simplified in a new Co-Operatives Bill that will be put before Parliament."

The bill will consolidate into a single statute several outdated pieces of legislation governing co-operatives and mutuals.

According to the Co-Operatives UK organisation, co-operative businesses are already outperforming the UK economy and have grown by 20% since the start of the credit crunch.

It says the consolidation of the legislation will create a more equal playing field for them by creating clarity and reducing running costs.

Ed Mayo, Secretary General of Co-operatives UK, said: "The new act is intended to make it as easy and natural to form a co-operative as any other form of business. We are delighted to see the Coalition taking action to put co-operative businesses on an equal footing and create a diverse economy.

"Co-operatives, as well as being widely recognised for their ethical business practices, are a vital part of the British economy, employing more than 235,000 people, turning over more than £33 billion each year and generating a significant amount of wealth for the country."

The Government is also providing new rights for public sector workers to create mutuals and own a stake in their success.

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