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11.33 am

Mr. David Drew (Stroud): I am delighted to be called to speak and to follow my hon. Friend the Member for Liverpool, Riverside (Mrs. Ellman). My hon. Friend gave a very clear exposition of the benefits of co-operation, mutuality and community benefit, which all of us, in a way, were elected to this place to represent. However, some of us see it more formally, and here I declare my interest, as a proud Member of the Co-operative party. It is pleasing to know that we are the biggest representative group in the history of the Co-operative party. I see many colleagues smiling, so I think I am among friends.

I do not want to reiterate the arguments that have already been made. The case for the Bill is strong, although no doubt we will tease out the details in Committee. I was pleased to receive a letter from my hon. Friend the Economic Secretary saying that in principle the Government support the Bill. They have some problems with clause 2, but I hope that those can be dealt with in Committee. I hope that the Bill will be given godspeed and go on to the statute book.

I want to discuss the need to encourage co-operatives in the rural economy, particularly in agricultural production. In my intervention on my hon. Friend the Member for Harrow, West (Mr. Thomas), I highlighted the fact that this is a particularly opportune moment at which to discuss the matter. The Curry commission, which will report next week or the week after, will deal with the problems of the agricultural economy post-foot and mouth. My right hon. Friend the Prime Minister asked the commission to look very carefully at how to revitalise, if not completely restore confidence in, the agricultural sector.

I have no reason to believe that the leaks we have heard are right or wrong, although I suspect that they are more right than wrong. It seems that the commission will recommend looking carefully at encouraging co-operation in this important sector. Critics will point out that one of the main co-operatives that previously existed, Milk Marque, was not helped by the Government. However, we need to study the history so that we do not always look at the bad side of the co-operative sector. If we can learn from that experience, we can take forward what needs to happen. I make no apology for concentrating on that aspect.

The Bill brings together two important features which we ignore at our peril. First, there is a crying need for co-operation among farmers so that they can take on other elements upstream in the food chain—the processors and retailers. I do not use the phrase "take on" in a confrontational way; I am merely referring to the way in which business, by co-operating at an appropriate level, can be more effective through synergy, and to the fact that people can do more collectively than individually. In response to my intervention, my hon. Friend the Member for Harrow, West gave the example of the pig sector, which already has many large co-operatives.

Secondly, we must realise that we are competing not only within this country but within Europe and other large agricultural economies, such as those in Australasia, where co-operatives are an important fact of life. If we do not take that into account we miss an opportunity, and risk finding out in the future that they are much more effective than we are. I am not usually a great pro-European—I see that my hon. Friend the Member for

25 Jan 2002 : Column 1129

Luton, North (Mr. Hopkins) has just come into the Chamber—but we can learn things from the European Union and from mainland Europe, such as how co-operation has allowed other countries to keep the agricultural sector more intact and how we can develop that in the appropriate way. The Bill gives us the opportunity to do that.

I work with many farmers in my constituency, and it is sometimes hard to recognise the benefits of co-operation. However, where such a system is in operation, farmers are its greatest defenders. Machinery co-operatives allow farmers to buy and share machinery. They also share veterinary costs and their most likely venture is to share marketing costs. Once all those things are established, farmers become great defenders of them. It is sometimes hard work to instil that interest, but once it is there it grows and it could enhance the agriculture sector, which is in desperate need of an uplift.

Co-operation in the rural economy is not limited to farming. Many of us are proud to have farmers markets operating in our constituencies. I have an important one—one of the initial ones—in Stroud. It certainly set the trend. It is pleasing that, even though the organisation is not registered as an industrial and provident society, it works as a co-operative and mutual organisation. There are many other examples. Cirencester was set up after Stroud, and works successfully. All the evidence that has been put to me shows that people want to develop it further. The Bill allows us not only to ensure that such organisations continue but to encourage many other organisations.

Co-operative organisations are active in the arts and in work with people who have particular difficulties such as disabilities. I use as an example the Arts Factory, set up 1990 in Ferndale in the Rhondda Valley. People are co-operating in the arts and using that to develop their skills and market their produce effectively. Another organisation called ADAPT in the Tynedale area of Northumberland works with people with disabilities, enabling them to work on a co-operative basis—employment that otherwise would not be available to them. The co-operative support to provide transport, advisers and so on is a good example of co-operation at its most effective. Other hon. Members, especially my hon. Friend and fellow co-operator the Member for Corby (Phil Hope), have mentioned credit unions, which are a vital part of our social fabric.

The Bill shows what we need to do to regenerate rural areas. My hon. Friend the Member for Harrow, West mentioned the Village Retail Services Association—ViRSA—which is a voluntary shop movement. That is not unimportant. One of the ways in which we can bring facilities that have closed back into use is through the voluntary shop movement. Such shops are often combined with a post office. At Port Appin near Oban a community co-operative has re-established a shop.

The shop is the centre of the village. Once villages lose their shop, they can begin to decline. I shall not get into the argument that has recently raged in certain regional newspapers about what is a vibrant village. I support the notion that the Countryside Agency should look at such things, but if my postbag and my local press are anything to go by, I am not sure whether the way in which it has

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approached the matter and labelled some communities has been helpful. We have upset an awful lot of villages by referring to them as less than vibrant.

If the Bill can help bring shops back into use and get communities behind them, and if the co-operative way is the best way of doing that, it is a jolly good thing that the Bill has come at this time. I am sure that my hon. Friend the Economic Secretary, who is back on the Front Bench, will understand that the Government have a key role to play not just by standing aside and watching the legislation go through but by actively encouraging it and ensuring that we get the best and strongest Bill possible. I hope that I will be able to help that process so that the Bill can lift the co-operative and mutual sector.

11.44 am

Mr. Adrian Bailey (West Bromwich, West): First, I had better make it clear that I am a co-operator of long standing. Like others in the House today, I must declare that I am a member of the Labour and Co-operative group of Members of Parliament. Before I entered the House, I was an employee of the co-operative movement for 18 years, during which I had an opportunity to meet representatives of many of the traditional co-operative societies, the mutual organisations and the huge range of new and emerging co-operatives.

In the debate so far, it has been interesting to note that each new speaker has mentioned a new sort of co-operative. I have worked within the movement all this time, and still I hear about new forms of co-operative endeavour of which I was hitherto unaware. That is a reflection of the way in which society now looks on that form of endeavour as a means of fulfilling social objectives which it would not have considered appropriate a few years ago.

I congratulate my hon. Friend the Member for Harrow, West (Mr. Thomas) on introducing the Bill. I know that it has been long demanded by the traditional co-operative and mutual movement, but it is also recognised by the new emerging forms of co-operative and mutual organisation as relevant to their aspirations. Above all, the Bill recognises that different types of businesses require different structures. It does not pretend that the same thing is relevant for all sorts of economic organisations.

It is clear that certain sorts of traditional shareholding companies are inappropriate for community-based businesses. They are good for certain types of entrepreneurs; they have been successful historically in creating wealth. However, companies legislation constrains them to put their shareholders' interest first. The Bill would strengthen organisations that put service before shareholders.

The hon. Member Twickenham (Dr. Cable) mentioned some of the difficulties that the co-operative and mutual movement has faced in the past few years. I concede that it has faced difficulties, but one must also recognise that many co-operatives and mutual organisations that have survived until now have their origins in the previous century. It would be interesting to compare the longevity of co-operative and mutual organisations with that of private shareholding companies.

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