Osborne's airbrushed co-op policy

17 February 2010

For all the Tories' fine talk of empowered workers, their plans would only undermine the public sector's democratic rebirth.

If George Osborne's proposals for co-ops had been about breaking up the corporate chains that dominate our high streets, limiting our choices and treating their workers with contempt, I would have been cheering. Why am I suspicious then when he proposes co-ops for our core public services? After all, we definitely need a radical change in the way that public services are managed. More power to frontline staff must surely be central to this, as must greater involvement of users and the community, along with a radical reform of the over-centralised, secretive and unfair ways in which the public are represented.

But must this involve a change of ownership, which is what the Tory proposals involve? Isn't there an intrinsic connection between public ownership and the purpose and character or our essential public services?

The provision of universal healthcare and education is in the public sector because it concerns everyone. The whole of society, not just a particular group of workers and users, benefits from there being an excellent primary school or first-rate social services in their locality.

The problem in the past is that the custodians of the public interest have interpreted their task as likened to a mix of a military commander-in-chief and Jesus: requiring central command exercised with paternalistic sentiment. Chief executives set the tone for management as command and control. Policy staff assumed that with the help of statistics and surveys they knew best. Department heads protected themselves through creating their own empires. Pockets of secrecy hiding arrangements of convenience were everywhere. And politicians, protected by an electoral system that reproduced the status quo – until voters decide to abstain in passive protest – have rarely been motivated to open things up.

Things have been changing, however, under all sorts of pressures, from social movements and community groups insisting that their knowledge, rooted in experience, matters as much as that of the "experts", through public sector workers insisting on workplace democracy, to the disasters of privatisation jolting public sector managers to look to democratic approaches to management specific to the challenges of providing high-quality public goods.

Another kind of public sector is in the making. I saw evidence of it myself while writing about an impressive experience of internal public service reform in Newcastle city council. The key to improving services and cutting costs was an egalitarian and mutually respectful partnership between management and the unions based on maximising public benefit. What I saw was a shift of management from command and control to decentralise and support, releasing the capacities of frontline staff, previously stifled by layers of supervision. I saw also a revival of the public service ethic, which often leads people to work for the public sector in the first place, through ensuring staff gave priority to meeting the needs of local people.

The last thing these workers wanted was as a group, as distinct from part of an active public, to own the service. They had resisted the fragmentation involved in contracting out, and the consequent influx of consultants and plethora of joint ventures. Yet when you read the small print of the Conservative proposal, this is exactly what their proposal will involved. It's like watching an airbrush. What begins with fine talk of power to the workers ends with talk of bringing in experts (more consultants?), joint ventures (more private corporations) and a complete deletion of local government (the arrangements are all to be with central government, guided by the Cabinet Office).

Changing ownership from private profit-seeking owners to co-operatives of workers and users with a mutual interest in the enterprise is an excellent way of making the market sector socially responsible. In fact, I'm all for a co-operative economy for everything we produce and buy through market exchange. But if we are to have a productive debate about democratising the public sector, we must start from the recognition that public goods are different. We must be able to make their delivery accountable in ways other than the market and in ways that recognise their value to all.

Co-ops can be part of this process, especially for the expansion of services into new areas (see William Davies and Clifford Singer).

The Conservatives' problem is that they don't have a firm and agreed commitment to the centrality and distinct nature of public goods and the importance of the democratic character of their provision. They therefore don't have a convincing strategy for reforming the state as a provider of public goods other than through making it like the market. Hence we end up with little more than airbrushed privatisation.

About the authors

Hilary Wainwright

Hilary Wainwright is a leading researcher and writer on the emergence of new forms of democratic accountability within parties, movements and the state. She is the driving force and editor behind Red Pepper, a popular British new left magazine, and has documented countless examples of resurgent democratic movements from Brazil to Britain and the lessons they provide for progressive politics.

As well as TNI fellow, she is also Senior Research Associate at the International Centre for Participation Studies at the Department for Peace Studies, University of Bradford, UK and Senior Research Associate at International Centre for Participation Studies', Bradford University. She has also been a visiting Professor and Scholar at the University of California, Los Angeles; Havens Center, University of Wisconsin, Madison and Todai University, Tokyo. Her books include Reclaim the State: Experiments in Popular Democracy (Verso/TNI, 2003) and Arguments for a New Left: Answering the Free Market Right (Blackwell, 1993).

Wainwright founded the Popular Planning Unit of the Greater London Council during the Thatcher years, and was convenor of the new economics working group of the Helsinki Citizens’ Assembly from 1989 to 1994.\

Follow Hilary on twitter: @HilaryPepper


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