Spotlight on ACCORD

A number of items in this issue of ACCORD News focus on the role of co-operatives in the community. ACCORD is interested in better understanding how co-ops can help strengthen and build sustainable communities in Australia.

We examine the role of co-operatives in traditional industries such as the taxi industry in country NSW. We highlight some innovative initiatives in employment creation, from the re-training of professional fisherson the central coast, to the development of new community initiatives in southern Tasmania. The COW Co-operative is another example of the pro-active role co-ops can play in helping to create pathways to employment for many previously excluded from the workforce - a theme strongly echoed through the International Day of Co-ops. We also reflect on recent research in the UK, which throws a new light on the composition of third sector community organisations.

Contents in this issue

Public Policy

1. Trade Practices - obstacle course for taxi co-operatives?

Co-operatives are formed by groups of taxi operators,principally to provide communications in the taxi industry. The co-ops are primarily responsible for operating the taxi network and booking service. They also offer a wide range of services to their members including maintenance of vehicles, training and administrative services.

The taxi industry in NSW is a heavily regulated environment. The NSW Passenger Transport Act; the Passenger Transport (Taxi-cab Services)Regulation 2001 and standards related to the accreditation of operators; the authorisation of drivers; and accreditation of networks create an umbrella of legislation which regulates all facets of taxi operations.

For example, the industry is required to have a set of rules for its radio network. These rules are approved by the NSW Department of Transport through the network accreditation process. The rules are designed to ensure that operators respond to bookings and effectively manage service delivery. However, the co-ops have also established their own operational rules,based on years of industry experience that guarantee the delivery of good customer services.

Research by ACCORD suggests that there maybe areas of conflict between the regulators of the rules, the taxi co-ops and the requirements of the Australian Competition and Consumer Commission (ACCC). In particular, the ACCC takes the view that exercising of the rules, approved by the Department of Transport and empowered under the legislation, is restrictive of trade. To read more, please click here.

In preparing this article, ACCORD has obtained information fromthe NSW Country Taxi Operators Association, taxi co-operatives in NSW and ACCC.We would welcome any comments from our readers in regard to thisarticle.

2. Friendly Society continues demutualisation trend

Australia's largest friendly society IOOF will demutualise. As the IOOF website notes:

In excess of 25,000, or 35%, of IOOF Ltd Members voted on the Demutualisation Scheme of Arrangement at the meeting held on Friday, 14 June 2002, with 95.88% voting in favour and only 4.12% voting against. This overwhelming support for the proposal is a strong endorsement of the Board of Directors' recommendation to demutualise.

We are now awaiting the approval of the Supreme Court of Victoria, and on receipt, the Company should be in a position to formally demutualise on 30 June 2002.

IOOF's moves follow the recent decision of a large agricultural co-operative, Darling Downs Bacon Co-operative to transfer to a for-profit organisation. These decisions follow a trend, which has seen Australia leading the way in the demutualisation of its co-operative and mutual sectors.

If you are interested in exploring the reasons for this trend in Australia, please contact Garry Cronan for further information: gcronan@uts.edu.au

The Red Bank Café Geeveston, a small rural village, approximately 50 km. south of Hobart in Tasmania's once famous apple growing region is about to become the hub of a new co-operative business venture - The Red Bank Café. The Red Bank Café will incorporate a Bistro style café, deli and culture shed. The concept is to develop and challenge the artistic, intellectual and generational mix within the community, encourage new food-growers, integrate existing producers and develop local specialities. For more information email Peter Brenner.

Dairy giants whip up a $2bn deal Bonlac Foods and New Zealand's Fonterra Co-operative Group have agreed to merge their operations in Australia and NZ, creating a powerful new Australasian consumer dairy products company. The consolidation brings together the Bonland Dairies and Peters & Brownes businesses in Australia with the Mainland Products and Tip top businesses in New Zealand. It will create a merged company known as Australasian Food Holdings (Australia) Pty Ltd (AFHL). The merged group will employ about 4000 people. It will market leading brands like Mainland, Tip Top Ice Cream, Meadowfresh, Ferndale, Huttons, Bodalla, Western Star and Cadbury Ice Cream in Australia, New Zealand and Oceania. To read more, please click here.

Development of Co-operatives

3. Training for more effective corporate governance

The Mercury Centre Co-operative is a corporate governance systems consultancy focussing on the community sector and regional Australia. The Centre evolved from the Australian operations of the Asia Pacific Co-operative Training Centre. The Professional Director training workshop, run by Mercury, is often used as a starting point for boards to examine their corporate governance systems, with the comprehensive accompanying manual serving as a resource for directors as they develop their own models of governance. Special emphasis is placed on the values of the organisation and the need for strategic planning.

The Chief Executive Officer of Mercury, Peter Gates, is also a long serving director of one of Australia's largest financial co-operatives, Australian National Credit Union which has over 160,000 members. Information about the centre is available at: www.mercury.org.au.

The first of July will see a new co-operative commence trading.

The COW Co-operative Limited seeks to create work and employment for people with mental illness. COW originated from Consumer Organised Work with 'consumer' being the commonly used term for a person consuming mental health services.

One in five Australians will experience a mental illness at some time during their life. Despite the misconceptions and prejudices that society generally has about sufferers of such illnesses, these people can be gainfully employed and make a valuable contribution to society. COW provides training and access to employment opportunities for people with mental illnesses. For more details, please contact Peter Gates.

Six South-east Queensland Community Housing Co-operatives will set up a service co-operative to improve their viability and establish a mechanism through which the co-operatives can minimise costs, improve their viability and increase co-operative housing stock. Following a report from O'Connell Hood & Partners, who were contracted to research and co-ordinate the project, the co-operatives have voted unanimously to incorporate the Alliance of Co-operative Housing Organisations (ACHO) as a company-limited-by-guarantee.

Key aspects of the co-operatives' operations will be co-ordinated and a common accounting system shared. A Co-operative Training Plan and Co-operative Induction Strategy is being developed, to ensure all new co-operative members receive quality training and information. For more details,contact Margi O'Connell Hood at e-mail ocohood@sun.big.net.au.

Margi O'Connell Hood, Manager of the Queensland Community Housing Coalition (QCHC), is associated with the Maleny group of co-operatives. She was invited to attend a colloquium on the Contribution of the Co-operative Sector to Housing Development hosted by the United Nations, in Ankara, Turkey on 27 and 28 June 2002. The objective of the colloquium is to stimulate development of the co-operative approach in the housing sector by facilitating exchange of information and experience of this approach in the housing sector.

Co-operative Profile

6. Working Nation initiatives on the Central Coast

Like many small country towns, Chain Valley Bay on the Central Coast of NSW was in decline due to its isolation and the loss of the professional fishing industry, a major source of revenue and employment in the area. Five years ago, as a way of helping to re-invigorate their community,local identities, Jack Cambourn, a former Trade Unionist and Bob Mortlock, a retired tugboat deckhand, set-up the Working Nation Co-operativeLtd. "We chose a co-operative structure because we wanted a democratic organisation based on ethical principles, where all members could have their say" said Mr Cambourn.

The Co-operative runs a community based training and employment centre. The Centre, located at the Wyee/Doyalson RSL Club, provides training for unemployed people in selective skills to meet the needs of the local labour market. People of all ages undertake courses in information technology, building, construction, landscaping and home maintenance. Since it opened in 1997, Working Nation has trained more than 2,200 people and assisted many in finding jobs. The most popular course is computer literacy, where 50% of the trainees have been women. One of the Co-operative's most successful initiative is the Mature Age Training Extension Scheme (MATES), which evolved because of the need to give older people skills in computer literacy.

To read more please click here.

International Developments

7. Co-operatives care about people and communities

As the International Co-operative Alliance notes:"Co-operatives are enterprises that operate under the values of solidarity and social responsibility. They care about their members and their communities. As market leaders or simply responding to the needs of a small local community,co-operatives demonstrate, on a daily basis, their concern for people, whether it be by addressing environmental issues, or strengthening the capacities of their communities to better cater to economic, social or cultural needs."

The ICA has formalised this concern for community by making it the 7th International Co-operative Principle - "Concern for Community". It is also the theme of the 80th International Co-operative Day and the 8th UN International Day of Co-operatives, celebrated this year on 6 July. If you would like to learn more see http://www.ica.coop/ica/ica/coopday/enmessage2002.html.

8. ILO adopts Co-operative Resolution

The recently concluded ILO Congress in Geneva adopted a recommendation concerning the promotion of co-operatives, to replace ILO Recommendation 127.

The new instrument, which includes the International Co-operative Alliance (ICA) definition, asks members to adopt measures to promote co-operatives in all countries, to create employment, develop their business potential, increase savings and investment and improve social well-being. Members are asked to consider the promotion of co-operatives as one of the objectives of national and social development, and to reflect on measures aimed at creating an environment that fosters the growth of economically viable and democratically managed co-operatives.

Although not formally binding, this resolution, nevertheless,will help governments in Australia focus on the potential role co-operatives can play in social and economic development. To read more about this historic decision, please see http://www.coop.org/welcome.htm.

Queensland

The Co-operative Community Council has organised a Cooperative Education Conference for the weekend beginning6 July 2002. The program includes presentations and workshops on co-operators' stories; principle of mutuality; and agenda for co-operative development. For details, please e-mail Christine.

The Co-operative Federation of Queensland will host the 2002 State Conference on 12 and 13 July 2002 at the Holiday Inn, Brisbane. Presentations will cover: Directors' Duties and Liability; Taxation and Management Issues; Co-operative Merit; Insurance;Exemptions available to Co-operatives; Co-operatives as a Tool for Reform &Regional Development; and Co-operative Change & Evolution for Success. For details, please e-mail Jim Howard.

Western Australia

Western Australian housing co-ops will host adinner/dance to celebrate living together on International Co-opDay. Members of housing co-operatives, people interested in community living and friends are invited to attend. The dance will be held on Saturday, 6th July 2002 at Progress Hall, Paget Street, Hilton from 7pm to midnight. Fordetails, please contact Olwyn (Pinakarri) - (08) 9331 3307 andCarre (First Fremantle) - (08) 9430 6135.

New Zealand

A seminar on Capital Structures and Resourcing for Co-operatives will be hosted by the New Zealand Co-operatives Association on Tuesday, 9 July 2002 in Te Papa, Wellington. Six co-operatives will discuss the capital instruments they use and the rationale for selecting those instruments. For details, please visit, the New Zealand Co-operatives Association's website.

9. The concept and classifications of agricultural co-operatives

This paper seeks to provide a comprehensive yet useful overview of the concepts of agricultural co-operatives with a special emphasis on taxonomy of agricultural co-operatives. It focuses on different classifications of the agricultural co-operatives identified in the literature. Fourteen classifications of agricultural co-operatives are outlined. The paper also considers some new forms of agricultural co-operation currently emerging in Australia and overseas.

The paper asserts that classifications of agricultural co-operatives could have important implications in situations where co-operatives become instruments of public policy.

10. Implications for the use of a co-operative structure for business activity in NSW

(By Tracie Arkley-Smith CA, Ross King Accountants Pty Limited)

The paper examines the implications for the use of aco-operative structure for business activity in NSW. The paper will be of interest to accountants, business advisors, lawyers and others who are considering using a co-operative structure for business purposes. The first section of the paper discusses the nature of a co-operative and its guiding principles. Section 2 outlines the principal taxation provisions affecting co-operatives. Section 3 considers the issues of competition and anti-competitive behaviour. Finally, sections 4 and 5 provide a comparison of a number of different business structures, including co-operatives, on the issues of ownership, formation, management, wealth distribution, flexibility and taxation.

11. New UK report suggests mostly affluent groups join third sector organisations

A study, conducted for the UK Countryside Agency, has found that mostly affluent groups join and participate in third sector organisations. 75% of households earning over £275 per week participate in one or more community groups compared with just 21 per cent of lower-income households.

This lack of participation by lower-income populations appears to be due to a widespread perception that such organisations are for people other than them. Just 16 per cent of lower-income compared with 82 per cent of higher-income households felt that they could join or participate. As one respondent put it, "The community centre and all the community groups are more for upper class people, not us."

The study involved 350 face-to-face structured interviews and 10 focus groups in five contrasting rural areas. First, the types of informal one-to-one aid received and provided, and second, the membership and usage of community-based 'third sector' organisations, were analysed. Focus groups in each locality explored attitudes to participation in such activity among old and young people.

The study makes a distinction between the 'third sector', which ranges from formal voluntary organisations (eg, faith groups) to community-based groups that fulfil an economic function (eg, credit unions), and the 'fourth sector' which includes more informal community activities such as baby-sitting circles, car-sharing schemes and one-to-one help given to kin, friends and neighbours.

The study was highlighted in the recent issue of New Sector, the magazine of workers' co-operatives and community-owned businesses in the UK, dedicated to establishing worldwide links with others involved in local economic development work. New Sector is published on behalf of the Co-operative Union (ICOM section), Community Business Scotland Network (CBS Network) the Wales Co-operative Centre and Social Economy Agency Northern Ireland. For more information, see http://www.newsector.co.uk.

12. Report on the role of UK Social Economy Development Organisations

A recent series of research papers commissioned by the Social Economy Agency for North Ireland (SEA) provides insights into the potential role of social economy organisations to address employment creation, community and regional development and social exclusion. The reports link together the concepts of co-operative and social economy development with the need for Community Development Financial Institutions (CDFI). The reports include a series of recommendations for the construction of a supportive public policy environment. For more information on this review, please click here .

The SEA was established in 1986 as a result of lobbying by co-operatives, trade unionists and community activists, to provide support to the co-operative movement in Northern Ireland. Its current mission is "The Creation of an equal and just society by promoting Social Economy Solutions,which renew and sustain local communities". To read more about SEA, please click here.