Labour/Co-op MP Jim McMahon has called on the government to schedule a debate on farm co-ops as a route to a stronger food system.
The MP for Oldham West, Chadderton and Royston told the Commons: “There are around 430 farmer-owned co-operatives in the UK,” he told MPs, “and around 150,000 farmer members, with a turnover of £10bn a year.
“They deliver high quality food produced the highest welfare and environmental standards. With food security being national security and the government being committed to doubling the size of the co-operative sector, will the leader of the House grant time for a debate on expanding the agricultural co-operative sector, so that it can play a role in strengthening the UK’s food production?”
Sir Alan Campbell, leader of the House, replied: “I pay tribute to the co-operative movement for the work it does in this regard. It is a very important part of the story of food production.
“Should my hon. friend seek a debate on these matters, I am sure there are many Members across the House who would want to join in to discuss what is a very important subject.”
There has long been concern over the size of the UK’s agri co-op sector, which is smaller than comparable countries. Last December, Co-operatives UK issued a report on the ways to grow the sector, arguing: “Strengthening co-operation can boost farm incomes, increase productivity, accelerate innovation and improve national food security.”
It added: “Farmers who belong to co-operatives secure better prices, pay lower input costs and save significant time through shared services. Arla members receive around 51% of the retail price of milk compared to 43% for non-co-operative suppliers, while AF members routinely achieve savings of 5% to 30% across major inputs such as electricity, fertiliser, crop protection and veterinary medicines.
“Meanwhile, producer organisations in horticulture have driven extraordinary improvements in yields, product quality and environmental performance by enabling collective investment in technology, robotics and advanced growing systems that would be unaffordable for individual growers. These benefits translate into greater resilience, reduced risk and stronger local economies.”
Related: Co-op Group and Co-operatives Wales join call for Good Food Bill
But there are barriers to co-operation in agriculture, and Co-operatives UK outlined “urgent policy needs”, including better national data on the sector, modernised capital rules, targeted financial support, clearer regulatory frameworks and an expansion of collaborative advisory services.
The report also recommends that government use public procurement to expand markets for co-operative produce – an idea explored at January’s conference of the Scottish Agricultural Organisation Society (SAOS) – and address “issues in Fair Dealing regulations that fail to recognise the role of co-operatives in supply chain fairness”.
But the co-op sector suffered a setback in December, when the EU Fruit and Veg Aid Scheme ceased to apply in the UK, post Brexit. The scheme supported producer organisations in the fresh produce sector, including many co-ops.
The devolved goverments in Northern Ireland and Scotland will extend their producer funding, while the scheme continues in the EU – but Emma Reynolds, secretary of state for environment, food and rural affairs (Defra) said there would be no like-for-like replacement for the scheme in England.
The scheme allowed producer organusations to apply for match funding for projects based around sustainability, efficiency or innovation but producer organisations must now rely on competitive grants open to all agriculture businesses, or other funding pots, such as the Sustainable Farming Incentive.
Tim Bailey, CEO of SAOS, said: “It is very disappointing that Defra has discontinued its support of producer organisations in England. This is a failed opportunity to support agricultural co-operation with targeted and focused match funding for groups of producers working together to deliver multiple financial, environmental and social benefits.
“One excellent example of how this can work is the Fruit and Vegetables Aid Scheme which, through co-investment with industry, has supported growth, innovation, efficiency, and positive environmental practices for the fruit and vegetable sector.
“SAOS welcomed the Scottish government’s commitment, in 2024, to continue supporting the funding of the Fruit and Vegetable Aid Scheme to registered producer organisations which are established as co-operative entities. SAOS is very supportive of ScotGov’s ongoing commitment to the scheme, which has been reflected in the Rural Support Plan published on 24 March 2026.
“We believe there is a case to extend the producer organisation model to other sectors where there is limited price discovery, and where it could support and develop a more strategic approach to the cost effective and sustainable production of more Scottish and British agricultural products.
“We will continue to advocate new thinking in this regard with both the Scottish and UK governments.”
