Mr Wicks, MP for Croydon North, thanked the Co-operative Party for their support in promoting the Bill and praised the role played by the mutual sector in the economy and the importance of their commitment to member democracy and long-term planning in the current economic climate.
He told the News: “This Bill completes a further modernisation of the law governing co-ops and credit unions. It comes at a critical time when people are looking for alternatives to conventional big business beholden to shareholders.
“Co-ops offer this alternative and credit unions are the decent alternative to both the high street bank, that offers little to low income groups, and the foul loan sharks, charging extortionate interest rates, that stalk single mothers in our most deprived communities.”
Mr Wicks’s Bill will:
• Apply the Company Directors’ Disqualification Act of 1986 to co-operative societies
• Give the Treasury powers to apply Company Law to investigate societies when necessary. The Financial Services Authority will play a full role
• Give the Treasury powers to make provisions for credit unions corresponding to those applying to building societies.
The Bill is the culmination of over a decade’s work by the Co-operative Party that has seen a succession of four Private Members’ Bills aimed at creating a more level playing field for co-operatives and credit unions when competing against other corporate forms.
This latest Bill completes the picture for primary legislation, consolidating all new legislation into a single bill and leaving no outstanding issues that cannot be dealt with by secondary legislation alone.
It includes provisions to remove restrictions on the actions of credit unions, including liberalising membership criteria and allowing electronic communication with their members. It also replaces the archaic legal definition of ‘industrial and provident society’ with ‘co-operative and community benefit society.’
The Bill will now be considered by a Public Bill Committee before returning to the House for its Third Reading later this year.
Added Mr Wicks: “Co-op societies have merged into a powerful new entity: the Co-op Group is taking over Somerfield to become a serious rival to the superstores; and the Co-op Bank is merging with the Britannia Building Society to form a super-mutual.
“Given the banking crisis and a new ethic that informs customer choice, I believe the sector offers a serious alternative to both private enterprise and nationalisation.”