The Isle of Wight's Green Euro-MP is to submit a proposal to the Leader of the Isle of Wight Council for support for a worker co-operative at the Vestas wind turbine manufacturing plant to be established under the Sustainable Communities Act 2007.Dr Lucas's submission will be delivered today (Fri 31 July) at 4pm to Cllr David Pugh by Brian Lucas from Isle of Wight Green Party and a representative of the workers at the Vestas plant.
Under the Sustainable Communities Act 2007, councils and communities have the opportunity to put forward proposals on sustainable improvements to local economic, environmental and social wellbeing. Once established, individual councils' proposals are sent to the Government. The deadline for current submissions is 31st July 2009.
Dr Lucas will call on the IoW Council to ask for Government support under the terms of the 2007 Act to ensure that:
- The workers of the wind turbine company Vestas are permitted to form a Worker Co-operative, and are supported in doing so by the government.
- Financial support (at the very least unemployment benefit) is paid to the workers of Vestas until such time as the proposed Worker Co-operative is financially viable.
"Failure to keep the Vestas plant open will represent a spectacular failure by the government to match its rhetoric on green jobs with real policy action. It should be seizing the opportunity to create a renewable energy revolution that can see us through a transition towards a more environmentally and economically stable economy. Allowing the IoW plant to close now would be a massive embarrassment for ministers - and devastating for the IoW's workers."
There are around 500 worker co-operatives in the UK. They are primarily founded as new start enterprises rather than salvaged from ones that are under threat. However, there is a strong history of worker co-operatives being established by worker buyouts of viable businesses that are due to close - think of Tower Colliery, for example, a mine bought by the miners when it was due to be closed.
Is a worker co-operative the answer for the Vesta plant?
Posts
This is very encouraging development. The UK government could learn a lot from the arrangements in Argentina and Venezuela where the workers in companies that close can apply to the court to take control of idle equipment left by a former employer and carry on trading. In Argentina, for example, workers can form a cooperative and the cooperative can be granted control of plant equipment for two years. During the two year period, either the cooperative or the (local) government expediates an agreement with the former owners to sell, or lease, their assets so that trading can continue. Local governments can even buy the equipment and lease or rent to the cooperative to secure jobs.
ReplyDeleteNobody should be under any illusion that trading in these circumstances is easy, but it is immeasurably better than closing companies. Importantly, it provides a legal route out of insolvency procedings. As a parliamentary report by the Common Cause Foundation found in 2006, private companies often close profitable companies, or seek to place saleable assets in a new company, and employee liabilities in another. They then close the company with the employees (leaving the state to pick up all the costs), and sell the other assets (acquiring the profits).
The Argentinian and Venezuelan solutions provide a model for transfers into cooperative ownership, and are underpinned by the goal of protecting as many jobs as possible (as well as taking productive assets into community ownership and control).
Good luck to the workforce and local politicians in this case. I hope they not only find a solution for the IoW, but can establish a precedent that others can follow.
Best wishes
Rory Ridley-Duff
Sheffield Business School