October 2022 digital edition
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COST OF LIVING CRISIS<br />
Liz Truss announces support measures on energy costs – but could<br />
co-operative values offer more effective solutions?<br />
As the government begins to assemble<br />
support packages for households and<br />
businesses struggling to cope with soaring<br />
energy bills, the co-op movement has<br />
been among those calling for equitable<br />
and effective solutions.<br />
It comes at a critical time for the sector,<br />
with Co-operatives UK, the apex body<br />
for the UK’s 7,000 independent co-ops,<br />
reporting that 25% of its members are<br />
concerned for their survival over the<br />
next 12 months, with 5% approaching<br />
such a crisis point that they could cease<br />
operating within the next three months.<br />
Support measures<br />
With the Conservative leadership question<br />
resolved after a lengthy election process<br />
and Liz Truss moving into Downing Street,<br />
the government announced a freeze<br />
on domestic energy bills and a £40bn<br />
funding package for businesses.<br />
With the business sector urgently<br />
calling for more help, business secretary<br />
Jacob Rees-Mogg announced the Energy<br />
Bill Relief Scheme, which will provide a<br />
discount on wholesale gas and electricity<br />
prices for all non-domestic customers.<br />
This will include all UK businesses, the<br />
voluntary sector – such as charities – and<br />
the public sector, including schools and<br />
hospitals. This support will be equivalent<br />
to measures put in place for households.<br />
Co-operatives UK is writing to Truss<br />
to ensure that the co-op sector is “fully<br />
included and effectively supported in any<br />
action for businesses, along with all other<br />
social enterprise, community businesses<br />
and charities affected by the energy<br />
price shock”. James Wright, policy and<br />
development lead, added that members<br />
are particularly calling for action to limit<br />
prices for non-domestic energy customers.<br />
Wright said: “Our latest data adds<br />
to evidence that to do otherwise risks<br />
a ‘doom-loop’ of destitution, corporate<br />
insolvency, high unemployment and<br />
wasted potential.”<br />
Co-operatives UK surveyed its members<br />
and found that:<br />
• Half of responding co-operatives, which<br />
together employ more than 85,000<br />
people, are severely impacted<br />
p Liz Truss during the leadership campaign (Image: John Snelling/Getty)<br />
• 25% are concerned about their survival<br />
in the next 12 months<br />
• 5% are concerned about their survival<br />
in the next three months<br />
• 28% of co-operatives find their ability<br />
to create value for members/customers/<br />
communities in a financially sustainable<br />
way is severely undermined.<br />
The “ability and potential of these<br />
businesses to create and sustain decent<br />
livelihoods, expand opportunity and<br />
benefit communities across the UK, is<br />
jeopardised,” warns Wright in an online<br />
statement for Co-operatives UK.<br />
“Co-operatives are an essential part of<br />
the social economy our communities rely<br />
on in hard times,” he added. “Of the cooperatives<br />
who tell us they are severely<br />
affected, 60% are currently active in<br />
the mutual aid response to the social<br />
emergency and are looking to ramp up<br />
such activities over the winter, subject to<br />
their own financial sustainability.<br />
“What’s more, co-operatives offer<br />
excellent prospects for growing a stronger,<br />
fairer, greener UK economy. We cannot<br />
afford to lose these co-operatives now. The<br />
new prime minister must take immediate<br />
and effective action to prevent permanent<br />
damage to businesses, including co-ops.”<br />
Rees-Mogg’s announcement of<br />
support for businesses helps to address<br />
these concerns. Tony Armstrong, CEO<br />
of community business support body<br />
Locality, said: “This scheme will help<br />
many local community organisations<br />
facing the double whammy of soaring<br />
energy bills and rapidly rising demand for<br />
their services.<br />
“These are the organisations providing<br />
the essential spaces and support<br />
communities will need to get through this<br />
hardest of winters – everything from debt<br />
advice and health services to a hot meal.<br />
“We look forward to working with<br />
the government to ensure this scheme<br />
continues as the winter progresses. But<br />
this crisis reaches far beyond energy bills<br />
– we need to see targeted grant support<br />
if community organisations are going to<br />
keep playing their essential role on the<br />
front line of this crisis.”<br />
Call for new economy<br />
The Co-op Party has been calling for<br />
government action – and measures that<br />
go beyond financial support to a more<br />
fundamental economic reform.<br />
General secretary Joe Fortune said: “We<br />
are clear about the changes Liz Truss must<br />
make in both the short and long term.<br />
“Our movement and Party are alive<br />
with ideas which will give our country a<br />
better future. Over the coming months and<br />
years, we must campaign for those ideas<br />
and the movement we represent with even<br />
more zeal and energy.”<br />
8 | OCTOBER <strong>2022</strong>