Wales Co-operative Centre

Canolfan Cydweithredol Cymru

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Continued financial capability support in Wales is vital

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The Wales Co-operative Centre runs a number of projects that promote financial inclusion and that provide advice on money management. These projects are a key part of the Centre’s role in developing and implementing solutions to strengthen communities and promote inclusion in Wales. Jo Lovell, who manages one of these financial inclusion projects, blogs about todays BBC News report on tenants affected by a housing benefit cut in England.

BBC News has today reported that “More than half of tenants affected by a housing benefit cut in England were in arrears five months after the changes were introduced.

“Some 59% of tenants – more than 300,000 – were in arrears, analysis for the Department for Work and Pensions (DWP) found. But a DWP spokesman said “around 50% of Housing Association tenants were in arrears before the changes.”

The government said its reforms were tackling “welfare dependency”.

The changes to housing benefit in England, Scotland and Wales – dubbed the “bedroom tax” by critics, but described by Ministers as the removal of a “spare room subsidy” – were introduced in April last year.

If tenants are deemed to have one spare room, the amount of rent eligible for housing benefit will be cut by 14%. Those with two or more spare bedrooms have had reductions of 25%.

One in five people in arrears had paid nothing towards this. Researchers found widespread concern that those who had paid, had borrowed or made cuts to other essentials.

People were already struggling to manage their finances, but the introduction of the bedroom tax has only exacerbated this situation. Back in November 2014, Community Housing Cymru reported that “78% of their members had seen a spike in rent arrears since the introduction of the bedroom tax.” Now 15 months on from its introduction, we are really starting to see the true long term impact on both tenants and housing providers.

Our experience here at the Wales Co-operative Centre, tells us that tenants will find ways to make up additional payments in the short term, but they can’t sustain them over the longer term. To keep a roof over their heads, tenants will either have to make cuts in spending, and for some this will be the choice of heating or eating, whilst others will be forced to make the ill informed choice of borrowing money (usually at a high interest rate), which will ultimately push them into further financial difficulties and an increased risk of becoming homeless.

It seems to me that there are several different issues here:

  1. The lack of affordable housing for tenants to downsize
  2. Tenants financial capability
  3. Training for frontline workers

Through the various projects managed at the Wales Co-operative Centre, we are supporting all of the above issues.

Through our Tackling Homelessness through Financial Inclusion (THFI) project, we are working closely with tenants and housing providers to improve peoples financial capability and access to advice and support they require, but this can be very challenging as it requires a change in behaviours, and we know all to well this doesn’t happen overnight. Our Financial Inclusion Champions project is helping to address the training needs of frontline workers in Wales, whilst our Co-operative Housing project, is keen to work with people interested in establishing a pioneering co-operative housing scheme. That could address the lack of appropriately sized affordable housing.

This report certainly highlights the need for more resources to be made available to support tenants who are struggling to make ends meet, training for frontline workers and for more community led affordable homes to be build.


Written by Ieuan Nash

July 15, 2014 at 4:09 pm

“The Awkward Squad never retire”. How do worker co-ops and employee owned businesses deal with retirement?

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In episode 2 of the hit BBC drama Baker Boys a key character, Gwynfor, has taken the hard decision to retire early. In Gwynfor’s case he knows that there is not likely to be any immediate return on his investment in the Valley Bara Co-operative as the Bakery is struggling – but what happens in a real worker co-operative or employer owned business when an owner / employee chooses to retire?

Retirement – What does this mean for shareholding / board membership / future involvement?

When a member of a worker co-operative retires, they would usually sell the shares they hold in the business. Many worker co-operatives clearly state in their rules that only current employees can hold shares in the business, so when a member retires it would signal the need to sell their shares, and usually the time frame within which the shares should be sold. They would normally offer the shares in the first instance to the other employees in the business. If no one wants to buy the shares, the business can buy them back. The business’ accountant would agree on the value of the shares at the time of the sale. If the retiring employee has very specialist knowledge which is critical to the business, the business may wish to appoint him/her to the Board of Directors as a non-executive board member so they can still make a contribution to the business’ future.  

Click here for more information about Employee Ownership and the services offered by the Wales Co-operative Centre.

The Wales Co-operative Centre was set up thirty years ago and ever since we’ve been helping businesses grow, people to find work and communities to tackle the issues that matter to them.  Our advisors work co-operatively across Wales, providing expert, flexible and reliable support to develop sustainable businesses and strong, inclusive communities.

Missed this episode? Watch it on iplayer here

Written by David Madge

December 1, 2011 at 9:58 pm

Posted in co-operatives

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Wales Co-operative Centre Chief Executive calls for business owners to consider employee ownership options

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With the new series of Baker Boy’s hitting our screens, Wales Co-operative Centre Chief Executive, Derek Walker, calls for business owners to consider employee ownership as a realistic option for business succession.

 The eagerly awaited new series of Baker Boy’s has returned to BBC Wales. The drama that focuses on a fictional worker co-operative in the Valleys offers a warts ‘n’ all insight into the benefits and hardships that a worker buy out or worker co-operative offers. All is not looking good for Valley’s Bara, the bakery taken over by its employees in the first series. The business is struggling, their key investor has disappeared, there is dissention in the ranks, cash flow issues, customer relationships, and the ongoing search for new business. But it was never going to be an easy ride.

This is often the reality of a new business. Whether the business is created by a single investor, a partnership or is owned by its employees like Valleys Bara there will always be business challenges to live up to. The hard work, sweat and sometimes, tears are the building blocks of security and future success and this is the reason that both business owners and employee groups should consider employee ownership options and opportunities for the future of their companies.

In Valley Bara’s case, the owners closed the factory and the employees bought it out as an emergency measure. This is achievable in some circumstances but considering employee ownership as a planned exit strategy may be a more considered approach for many business owners and a more attractive choice than redundancy for their employees.

Federation of Small Business research shows that the average business owner in Wales stays with his or her business significantly longer than in the UK as a whole. Over 1 in 5 business owners have been involved with their businesses for 21 years or more. Business owners expecting a trade sale to materialise out of nowhere to fulfil their retirement plans may be in for a nasty surprise in the current climate.

Employee ownership is not an altruistic option though. It can ensure a fair price for the company and can offer several options for phased withdrawal. Employee Ownership has been proven to increase employee commitment to the organisation, ensure more security for both the businesses and the employees. It guarantees the business is in the safe hands of people who know the business and care about it.

At the Wales Co-operative Centre we are often asked how worker co-operatives and employee owned businesses can work. After all, they are democratic, they are focussed on the interests of a major stakeholder group, the employees, who have a vested interest in the day to day running of the company and they are inclusive. How are decisions ever made? The fact is that employee owned businesses still need an effective management structure to run the business on a day to day basis. The owner employees make strategic decisions at specific times such as AGM’s and quarterly meetings depending on the set up of the company. But operational, marketing and financial decisions still need to be made by the relevant officers with responsibility for that area. Worker co-operatives or employee owned businesses are businesses just like any other. The only difference is that the benefits of a successful business are shared by a wider circle of people within the business.

The employees of Primepac Solutions in Ebbw Vale created their business in October 2005 after their parent company pulled out of South Wales. The 19 members of the worker co-operative had to be involved in every aspect of the business – they even scrubbed the floors of their new premises to get it ready for production. They now employ 22 permanent staff and up to 20 temporary staff at their site in Ebbw Vale in a business with a turnover of £1.8 million. In Aberystwyth, the owners of biotechnology instrumentation company Aber Instruments decided to look at employee ownership as a phased exit strategy. Now, 10 years into the process the original owners are minor stakeholders and the employees own a large share of the business with the remaining shares in trust for future ownership and to allow future employees the chance to have a stake in the business.

Of course, employee ownership isn’t just limited to micro businesses and SME’s. The Co-operative Retail Group and John Lewis have outlets all across the UK, turning over nearly £20billion of business between them.

Think about it. If everyone had a share in the business, wouldn’t everyone want it to achieve more? More turnover, more sales – more profit?

Of course, back at Valleys Bara, Owen and the rest of the employees have to deal with the day-to-day issues and the effects they have on their relationships and their families. Hopefully, over the three episodes we will see the employees at Valleys Bara make their enterprise work.

The Wales Co-operative Centre has set up a project with Welsh Government and European Union backing to support business owners and employee groups develop employee ownership approaches. Our advisors work with both parties to ensure that the process is fair for both the owner and the employees. We offer support to employees on their journey from the initial formation of a buyer group to management support throughout the first months of the new business. Click here for more information on how the Wales Co-operative Centre can help with employee buyouts, exit planning and worker co-operatives.

To give the story impact the scriptwriters pit the Valleys Bara employees against some big business challenges. Fiction needs drama to make it interesting. However, in real life, the Wales Co-operative Centre can be there to support employee buyout teams and worker co-operatives to minimise the drama that they face on a day to day basis. We can help to take the crises out of the drama.

Derek Walker is Chief Executive of the Wales Co-operative Centre.

The Wales Co-operative Centre is a development agency which champions co-operatives and co-operative working, believing co-operation can be a powerful driver in business success, innovation and social change.

This article first appeared in the Western Mail on Thursday 24th November.

Written by David Madge

December 1, 2011 at 10:28 am

Guess who’s back? Tough decisions for the Baker Boy’s

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So the wanderer returns. Rob is back and this time he really does mean business.

This first episode is set just six weeks after the end of the last series and it demonstrates that the early days of any business – whether they are a start-up SME or an employee owned enterprise – can be tough. It is essential for every business to have a strong business plan that can ensure their survival in the event of the loss of a major customer (as it looks like Valleys Bara has lost Capaldi’s tonight).

The episode begins to address some of the major issues that worker owned businesses need to consider: shares, ownership, management structure, succession and the effect the decision to buy out a firm could have on family and friends.

Dave and Lucy’s debt situation is a sadly accurate depiction of the sort of financial problems we can find ourselves slipping in to all too easily. Although the obvious advice here is never to use payday loans where the interest rates are astronomical there are other alternatives. In Wales, it is possible to access credit union services, no matter where we live or work. Credit unions work with their customers, who become members, to help them manage their money whatever level of income they have or whether they are having financial problems or not. People save and borrow at reasonable rates with the emphasis on flexibility and  affordability. For some people going to their credit union for a loan, in desperation, when they have money worries, leads to a whole series of advice and support that means that borrowing isn’t necessary. Specialists in advice such as the Citizens Advice Bureau work closely with credit unions so it can be a gateway to the solutions that Dave and Lucy need to find.

Click here for further information on the Wales Co-operative Centre’s work on Financial Inclusion

This episode is all about independence and standing up for yourself on your own. Nathan’s independence from his Dad. Sarah’s independence from Rob and Owen, Dave and Lucy’s financial independence. And, of course, Valley Bara’s independence as a business and as a focus for a community.

For more information on how the Wales Co-operative Centre can help with employee ownership and co-operative development in your communities, click here.

The Wales Co-operative Centre was set up thirty years ago and ever since we’ve been helping businesses grow, people to find work and communities to tackle the issues that matter to them.  Our advisors work co-operatively across Wales, providing expert, flexible and reliable support to develop sustainable businesses and strong, inclusive communities.

Missed this episode? Watch it on BBC iPlayer here

Written by David Madge

November 24, 2011 at 9:58 pm

The Baker Boys are back!

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The BBC Wales drama following a group of employees who buy out their bakery when their parent company tries to close it returns for a second series on Thursday 24th November.

The original series followed the trials and tribulations of the bakery staff as they formed a buy-out team and raised the finances to take over the company. The series examined the issues a real buy out team would face – distrust, initial reluctance, the fear of investing redundancy payments and the effects that the process can have on relationships with family and friends.

During the screening of the next series, we will be publishing a series of short blogs about key themes that are raised in the show.

To find out more, follow @WalesCoOp and the hashtags #bakerboys and #walescooperative and check our blog for regular updates.

For a quick reminder of the first series visit the BBC Website here and click here for a Western Mail interview with star Eve Myles

Written by David Madge

November 18, 2011 at 11:50 am

New BBC Wales drama to bring co-operatives to a wider audience

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Author: Mark Smith

Bakers Boys - image courtesy of BBC WalesIf you watch one TV programme this weekend, make it Baker Boys on BBC One Wales at 9pm on Sunday night.

The new three-part drama follows the story of a Valleys bakery’s workforce, faced with the stark prospect of its factory closing down due to the recession but triumphing over adversity by taking over the business as a co-operative.

I’ve already had a sneak preview of episode one and I can tell you that it strikes the perfect balance between the romantic ideal of a community ‘doing something for itself’ on a grand scale, with the reality of the arduous journey that such a group has to go on in order to achieve an employee buy-out and form a worker co-operative. It doesn’t pull any punches and doesn’t sacrifice excellent acting for the sake of conveying what could have been a complicated storyline.

The writers and actors need to be congratulated for getting it just right and bringing the issue of co-operatives to a new and much wider audience in Wales than ever before.

One of my colleagues has told me about the community-owned shop in The Archers on Radio 4, where the residents of Ambridge came together to save its local store. It’s a story that we’re familiar with at the Wales Co-operative Centre, mainly due to the exploits of the Llanmadoc Community Shop in Swansea; however, it seemed that storyline led to positive action in the ‘real’ world, with more community-owned businesses being set up.

This has made me wonder whether ‘Baker Boys’ will have a similar ripple effect in Wales, leading to many more co-operatives being set up here, across all different sectors and industries.

Who knows, maybe Pobol y Cwm could sustain the story, by setting up its own community co-operative. One thing is for sure, while we and other organisations in the co-operative sector work hard to promote alternative, ethical and sustainable business models, without having the media on board we’re only ever going to reach so many people.

I hope the Baker Boys is the start of something new, something big, that we can work with – maybe the time is right for high-profile social action media campaign, based around co-operatives, social enterprise and the ideals of the ‘Big Society’ agenda.

For more information on support and advice for new and existing co-operatives, visit the Wales Co-operative Centre.

Written by C Kenzie

January 21, 2011 at 9:15 am

Website of the week – BBC Connect

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The BBC has announced the launch of BBC First Click campaign to help people get online.

BBC Connect is the website that will show you how to get involved, how to get other people involved and how to organise a ‘First Click’ session at your premises.

It provides information on the basics of using the internet and provides a phone number that you can call to discover where your nearest training session is being held.

The Communities 2.0 project run by the Wales Co-operative Centre in the guise of the Click.Connect.Discover campaign is a partner to BBC First Click in Wales.

Click.Connect.Discover can help you make more use of digital technologies. For more information , visit

Written by C Kenzie

October 19, 2010 at 9:07 am

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