The flag of devolution in defiance of Westminster: self-determination for London would enable a co-operative economy

As we continue to consult on ideas for the Co-operative Party manifesto for the 2012 London elections, Carl Rowlands writes on the opportunity for co-operative economic development in London.

As long as I remember, there have always been at least two Londons. True, it’s a city composed of numerous towns and villages, yet huge economic divisions effectively dissect the social landscape.

On the one hand, ownership of large swathes of the West End is effectively concentrated in the hands of the Duke of Westminster, and property companies run on behalf of a few, startlingly wealthy individuals. These are areas often composed of multinational businesses and services. This version of London includes the City, and since the days of Michael Heseltine’s Docklands Development Corporation, much of the riverside. Of course, these businesses provide work for many, as well as providing taxes for the British state.

On the other hand, much of everyday London is the place where small businesses scrape by. It’s usually starved of investment capital, yet people demonstrate enormous resourcefulness and creativity. There are proud traditions of self-organisation. A cross of cultures has resulted in enormous depth. Often tacky and a bit dirty, unemployment may not be the highest in the country here, but worthwhile, secure jobs are almost impossible to obtain within these local economies, with the shrinkage of the capital’s manufacturing sector. Those half-decent jobs that exist are often in the public sector, or in the privatised parts of the public sector.

As the average price of a home in Mayfair rises 40% year on year, and spending cuts hit those most in need, it appears that the ‘rich London’ has effectively declared war on the rest. The taxes contributed by the City have over the years has to be weighed against the concentration of wealth in the hands of a select few, and the cost of a bailout placed upon everyone. Meanwhile, payment for work in hotels, restaurants and shops, is barely adequate to support an individual, let alone a family. As Owen Jones writes in his book ‘Chavs: The Demonization of the Working Class,’ the benefits system has become one which effectively underwrites poverty wages. Now, it seems that it will not even do that.

The resilience of Londoners is remarkable. In parts of London, three-quarters of schoolchildren do not have English as a first language. Successive Westminster governments have asked London to absorb many different policies, many of which have only exacerbated inequality. Whilst subscribing to neo-liberalism, outsourcing and privatisation, they have also eroded the possibilities for local self-determination and localised economic strategies. The Greater London Council, abolished in 1986, has never been replaced by a body with the powers it needs, to ensure that the other Londons, the multiple Londons of the majority, are properly represented to an over-powerful British state, which is also, as it happens, prone to corruption and influence from special interests.

Londoners have the possibility next year to return Ken Livingstone as London’s mayor. I really hope that the Co-operative Party in London draws up some very clear, workable suggestions that can be adopted as part of his Mayoral platform. We should aim to rebalance the economy in London. The small businesses that bravely shoulder the burden of economic turmoil, largely caused by the financial sector, need to know that demand for goods and services will be reasonably stable. In the long-term, only diverse and comprehensive economic strategies, and the power to raise revenue locally, will be enough to assist. There are those of us who believe that London can benefit from a radically different approach to economic development. Basing an economy on co-operation can be intrinsically better, more sustainable and will have better long-term outcomes. To encourage London’s co-operative economy, something more radical and substantial is needed.

To put co-operation on London’s agenda, from the current base, will require an unprecedented amount of collaboration between different agencies. Only the Mayor working with a sympathetic GLA can pull these agencies together, with representation from the national co-operative federations, trades unions, charities and NGOs. Currently, the co-op movement lacks a central co-ordinating base, with scattered development across the boroughs. It exists in a social enterprise ghetto, where too much responsibility is placed on too few people with too few resources.

An example exists, in Wales. In the 1980s, the trades unions and co-operative movement set aside theoretical conflicts, and the Welsh TUC funded the creation of a Wales Co-operatives Centre. It should come as no surprise that the co-operative movement in Wales – worker co-ops, credit unions and community shops – is becoming a fixture of Welsh community life, often against a backdrop of economic hardship. The Wales Co-operative Centre could perhaps provide invaluable advice, and maybe even staff, to any proposed London sibling.

Yet the creation of a London Co-operatives Centre may have even more transformative potential. It could provide a model, replicable in different cities, both in Europe and around the world. What if it were to begin to re-structure the economy? It could play a role in rebalancing the relationship between labour and capital by providing co-operative employment services. It could enable the creation of a regional bank for co-operatives. The list goes on. Ultimately, it could park a distinct economic alternative on the doorstep of the City of London. Does this mean we are asking for the moon? Maybe, it is because we have to.

The author is a member of the Co-operative Party and served on the board of the London Industrial Common Ownership Movement.