As democratic, member-owned organisations, co-operatives have a critical role to play in generating and retaining wealth in local communities.
Local employee ownership leads to business decisions being made in the interests of the local community in which they are based. Profits are reinvested into the business, are used to create local jobs or are returned to the members, instead of going into shareholder pockets.
Local anchor institutions can support cooperatives by investing into a co-operative development agency, which is tasked with providing seed funding, loans, investment and advice to new co-operative enterprises. Anchor institution procurement teams can support them through goods and services contracts to retain wealth locally.
Case study – Preston Co-operative Development Network
In collaboration with Preston City Council and Co-operatives UK, the University of Central Lancaster (UCLan) has established the Preston Co-operative Development Network (PCDN) to encourage the population of local supply chains with co-ops. UCLan, the PCDN and Preston City Council provide support for local enterprises to convert to worker-owned co-operatives. UCLan is now managing a fund, financed by Open Society Foundation, to promote the establishment and expansion of local worker-owned co-operatives. This project aims to create at least 10 new co-ops in a two-year period, including a Co-operative Education Centre to provide training for local residents who want to start new cooperatives.
The University also provides free membership for local companies to the Centre for SME Development, where they are able to receive advice and guidance about the opportunities available for co-operative development in Preston.