EU gives full support to co-op movement’s community values
Co-ops in Ireland have over 100,000 individual members and 12,000 Irish employees, with combined global sales of €12bn. Conor Mulvihill works in the organisation’s Brussels office.
He says: “With the recession, people are certainly looking at alternative business structures. Co-ops have proven to be profitable and better equipped to cope. Rabobank in the Netherlands is a great example.
“Their co-op structure helped prevent the bank from going under a few years back. Here in Ireland, the cooperative structured credit unions have fared better than the mainstream banks in the current economic situation. Our own co-operative dairy sector is now lauded in the national business pages as the new stars of the Irish economy.
“Co-ops are seen now as a real, viable alternative business structure. The straightforward unregulated capitalist model was damaged in the recession, likewise the old socialist model failed in the late 80s. So people are crying out for a third way, a middle ground between the two extremes.”
We asked Conor Mulvihill for his views on the history and the future of Irish co-ops.
>>“While co-ops have the potential to be a fantastic engine in our economic recovery, it is important to remember the co-op model is not a panacea for all ills. The model has to be the correct business fit for the group involved. For example, in dairy in the UK, farmers there are currently in a state of crisis over the price of milk, and they do not have the same sort of dairy co-op setup as we have here in Ireland. While our dairy farms have had a tough time recently, the fact that they were structured within a strong co-op model helped them ride out the crisis far better than their UK counterparts.
“On the other hand, an area the co-op movement has failed to penetrate in Ireland is fruit, veg and much of the grain sector. We do have a successful mushroom producer group here in Ireland, but we are lacking co-ops or producer groups otherwise. Ironically, we actually import a lot of these food products from places where co-ops are strong, such as the Netherlands or the Mediterranean.
“In the livestock area we have had great co-operative successes in the mart and breeding sectors, but sadly the co-op meat processing sector has withered away and has been replaced by private interests. This has left livestock farmers in Ireland in the position of ‘price takers’ at the factories, as they no longer have ownership of meat processing in this country and thereby now have less power in the livestock production chain.”
>>“ICOS needs to do more to bring producers together. For example, the strawberry producers of the southeast work together, but are not members of ICOS. We must make ourselves relevant to them and groups like the Connemara Lamb or the Ring of Kerry. So can ICOS work with other organisations, like Teagasc, or like the Centre for Co-operative Studies in UCC, Enterprise Ireland, and others? Joined-up thinking is required, and I firmly believe that ICOS can lead this.”
>>“ICOS has more than 125 years experience of setting up co-ops. We give advice, we give political representation, policy development and support. We help with setup and registration, with the governance structure and co-op rule book. We can also train up directors and co-op employees in their roles, responsibilities and skills, help with funding, pensions, marketing and communication. It is a whole suite, really.”
>>“I would love to see groups like the Ring of Kerry and Connemara Lamb groups working together in some mutually beneficial areas. Could they team up with one marketing person for example, but still retain their individual identities? We have an expert committee on rural business development in ICOS, chaired by ex-Macra President and current IFAC chair Seamus O’Brien, along with representatives from across the co-operative sector in Ireland who will be working hard on these issues.”
>>“Every country has its own history and current circumstances, and you can’t impose a model from elsewhere seamlessly. However, there are some very interesting developments in the UK in recent times, with the Plunkett Foundation, where rural transport, shops, food enterprises community hubs, even community owned pubs and breweries have emerged. In most cases, these emerged when the town or village was about to lose the service.
“Loughmore Community Co-op shop in Tipperary is a great new example in Ireland. The village used to have two shops and five pubs, now Loughmore only has one pub, but they have a community-owned shop, specialising in selling local products from the immediate surrounds. We have helped with the establishment of this, but it is important that the community itself leads the initiative. In the UK, where there are more examples of this sort of co-op initiative, they’ve been able to secure UK lottery funding. Unfortunately, we can’t do that here in Ireland.
“The EU recognises that producer groups and co-ops in particular are effective and cost effective ways to get farmers to work together to get a better deal for themselves. In the proposed reform of the CAP, the addition of a new Article 36 in the rural development pillar is very important in this context. This could help develop co-ops in areas such as forestry, food, bioenergy and energy in general. It is in the maelstrom at the moment — there are 7,000-plus amendments to the CAP proposals up for consideration — but this article states that support will be provided for producer organisations, such as co-ops, and it may mean that funding is available to help set up and develop co-ops.
“We are also seeing that in Europe, the co-op can be a positive point of differentiation from a consumer perspective. Products that advertise and promote the fact that they are farmer-owned, have something of an advantage. Some consumers like the idea, it’s a chance for valorisation of the co-op brand, a way for farmer-owned and processed products to differentiate themselves.”
