Cooperatives Face Hard Times Without New Support

Many workers' cooperatives are struggling to stay afloat and need increased public support, said experts gathered at the 2011 International Forum on the Social and Solidarity Economy in...

By Portia Crowe

MONTREAL, Canada, Oct 20 (IPS) – Many workers' cooperatives are struggling to stay afloat and need increased public support, said experts gathered at the 2011 International Forum on the Social and Solidarity Economy in Montreal.

'By their own means they are surviving, without the support of the government,' Federico Luis Pöhls Fuentevilla, executive director of the Consejo Mexicano de Empresas de la Economía Solidaria, said in an interview with IPS.

'It is active resistance,' he added.

As opposed to the traditional private sector model, the U.N. defines cooperatives as 'business enterprises owned and controlled by the very members that they serve'.

The International Cooperative Alliance, which represents nearly a billion people in 96 countries, says cooperatives are currently focused in the areas of agriculture, fisheries, consumer and financial services, housing, and production, but the group hopes this will expand to many other sectors, such as schools, utilities and transport, to name a few.

Pöhls Fuentevilla's council comprises a variety of Mexican cooperatives and enterprises, and works to increase participation in public policymaking by creating initiatives and engaging with the federal government.

One such initiative is aimed at creating a federal law enhancing protection of the social economic sector.

'Our experience is that the officially recognised ways to organise collective enterprises are not enough,' Pöhls Fuentevilla told IPS. 'So we need to open the space for the creation of new legal measures.'

According to Pöhls Fuentevilla, the proposed legal framework would recognise the political tension between the 'social' and capitalist models of development, and the council is working to integrate both models and incorporate all 'social enterprises' into the law.

'We want it to be like an umbrella law, because our experience is that we need a little recognition of the social and solidarity economy,' Pöhls Fuentevilla told IPS.

He also hopes the council's active citizen participation will prove advantageous in articulating objectives, putting forward propositions, and demonstrating the importance of multi-sector participation.

'To guarantee results, it is necessary to have everyone's participation,' he said.

Such efforts toward gaining public recognition, if replicated elsewhere, could abet cooperative movements around the world, many which have shut down in recent years, according to the SEIRA Foundation's Miquel Miró. He noted Tuesday that in Catalonia, Spain, cooperativism has dropped fourfold in the past 10 years.

In Canada and other developed nations, social collective associates face a different concern: while cooperative prevalence has not yet begun to wane, it is predicted to do so in the coming decade, as the baby-boomer generation of owners and managers retires.

'It will be a catastrophe, a real tsunami. Regionally, local economies will be completely destroyed, as small businesses will be closed,' Alain Bridault, an executive committee member of the International Organisation of Industrial, Artisanal and Service Producers' Cooperatives, told IPS.

Bridault predicts a peak in mass retirement between 2018 and 2020, and expects hundreds of cooperatives to be sold on a monthly basis at that time. A shortage of buyers will also lead to private businesses taking over cooperatives, he explained.

In Quebec alone, Bridault estimates that 25,000 companies will not find new owners, leaving up to one million cooperative workers jobless.

'It will be an economic catastrophe — that's why I'm convinced we will be able to convince the government,' Bridault told IPS.

He is calling on the Canadian government to create a network of expert consultants to assist unemployed collective workers. He acknowledged the magnitude of the investment necessary for a relatively short period of time, but said a proper framework, coupled with appropriate fiscal policies, would be needed come 2018.

'It will affect all parts of the community,' he said.

Bridault also works with a private organisation, Relais COOP, that develops tools with special consultants to facilitate the transition from departing owners to future cooperative leaders.

Intergovernmental influence

Many hope that the United Nations' decision to dub 2012 the International Year of Cooperatives (IYC) will facilitate global efforts to bring these issues to the table.

'It's really a chance for the cooperative movement to profit from this opportunity, to put cooperativism on the scene, and to attract attention,' said the SEIRA Foundation's Miró.

Pöhls Fuentevilla agreed.

'We are going to celebrate (the global launch), because it is an opportunity to make people learn about cooperatives,' he said.

Bridault also acknowledges the symbolic year's ability to attract government attention to cooperatives, noting, 'Even if we have a government that does not align directly with our ideas, they will be looking at the issue.'

But, he cautioned, 'It is a starting point, not an end point.'

The International Year for Cooperatives initiative, headed by the U.N. Department for Economic and Social Affairs and the Committee for the Promotion and Advancement of Cooperatives, was designed to highlight the contribution of cooperatives to socio-economic development, poverty reduction, employment generation and social integration.

The IYC's Global Launch will take place Oct. 31 at the United Nations, and will feature side events and a round-table discussion on cooperatives' contributions to sustainable development.

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