Senate Recommends Level Playing Field for Co-ops
Wednesday, 23rd March 2016 at 9:22 am
The peak body for co-operatives and mutuals has welcomed the Senate inquiry report, which recommended that the sector receive more support and recognition from the Australian Government.
The Senate handed down a series of recommendations to address the barriers to innovation, growth and free competition for Australia’s member-owned business sector.
It also said that the sector should be given greater representation at government policy discussions and be actively promoted as an option for service delivery, particularly community-based initiatives.
CEO of the Business Council for Co-operatives and Mutuals, Melina Morrison, said that the report was an “important first step for recognising the way that co-operatives and mutuals increase competition and diversity in markets and contribute to a stable and resilient economy”.
“The report’s recommendations will help take the shackles off the sector and allow it to step up and fulfill its potential in both the economy and Australian communities.
“Co-operatives and mutuals have grown through the recent economic downturn, with one hand tied behind their back.”
The Senate committee recommended that the Corporations Act be amended to explicitly define mutual enterprise.
This would allow greater flexibility in the way that the enterprises raise capital and secure investment opportunities, which Morrison said was “particularly significant”.
“Giving mutuals a way to raise equity without demutualising is an opportunity to achieve parity for the sector with other types of businesses and potentially unlock billions of dollars of investment.”
The report also called for the eligibility criteria for government grants and funding be amended to ensure that mutuals and co-ops are not excluded on the basis of their business structure.
On regulatory issues, the Senate report recommended the harmonisation of disparate state regulations governing co-operatives across the country, which the BCCM has been advocating for since its inception.
The report also said that the Australian Government should work with the states and territories to “encourage the establishment of new co-operative and mutual enterprises”.
Chairman of BCCM and CEO of CBH Group, Andrew Crane, said the report recognised the contribution of co-operatives and mutuals to the economy as well as the value they provide to their members.
“Co-operatives are good for both people and the economy and this report provides the necessary reforms to enable the sector to grow and compete in increasingly globalised markets,” Crane said.
“The bipartisan support for the report is welcomed by the co-op and mutuals sector, and the BCCM will engage with all political parties for the implementation of the recommendations in full.”
Morrison also called on the Australian Government to implement the reforms.
“The sector needs action now in order to continue delivering economic returns to members, the economy and society,” Morrison said.