The Co-operative movement started during the second half of the industrial revolution. With the loss of the common use of land, workers had nothing to sell but their labour, and it was a buyers' market. Those who failed to find work in the factories were forced either to rely on meagre parish relief, or to starve. By the early 1800s, food prices were artificially high and wages were being reduced, while much of the population suffered extreme poverty and deprivation.
The idea of co-operation was not new - the Shore Porters Society claims to have been one of the world's first worker co-operatives - established in Aberdeen in 1498 (still trading, but not as a co-operative). However, the first consumer co-operative may have been founded in March 1761, in Fenwick, East Ayrshire, when local weavers formed the Fenwick Weavers' Society. They started to purchase collectively for the benefit of members and this has led many to consider the Society the first co-operative.
During the early part of the 19th century, the social reformer Robert Owen (b.1771, d.1858) made some of the first experiments in co-operation. A Welshman who had made his fortune in cotton, Owen was convinced that working-class people, given the right environment, could form co-operative communities. He put this into practice in New Lanark, Scotland, where his own business was based. For his employees, he built an Institute for the Formation of Character, which contained schoolrooms, public halls, community centres, and a nursery school - all extremely radical ideas for the time. Owen believed that these villages of co-operation would solve the problems of poverty, by allowing people to opt out of capitalist society and into a New Moral World.
Owen went on to establish other model communities in America and Glasgow, in keeping with his socialistic vision. Although these experimental mini-societies eventually foundered, he communicated some of the profound underlying values of co-operation to those who would later make them work, and Owen is thus seen as the spiritual father of the co-operative movement.
1827: Dr William King (b.1786, d.1865) founded a monthly periodical, The Co-operator. It was published for the next three years, and during that time set out a complete social and economic philosophy of co-operation. He urged the formation of small, local co-operatives to tackle the effects of the raw capitalism cutting across the country :
"These evils may be cured and the remedy is in our own hands. The remedy is CO-OPERATION."
Setting out the theory, he wrote that co-operation is not the immediate and general adoption of a new order of things, foreign to the ideas and habits of a race of beings the very law of whose existence is HABIT; but the slow and gradual formation of small societies of the more intelligent workmen, laying aside their antipathies and animosities, and uniting their labour for a common good attainable by union alone. Although after 1830, when The Co-operator ceased publishing, King was not involved with the practical formation of co-ops, his pamphlets served as guides for the future success of others.
By 1830, there were several hundred co-operatives. Some were initially successful, but most co-operatives founded in the early 19th century had failed by 1840. The failure of these first attempts at co-operation was due to a number of factors – trustees were often not subject to regular election and became autocrats (however well intentioned) with no common ownership or democratic control; management was often imprudent with idealism not supported by practical provision, and in other cases there was practical endeavour but with no provision for future development.
The Rochdale Pioneers
1844: A number of strikes by weavers in Rochdale over the preceding 40 years had failed to have the lasting effect of improving wages and living conditions. After the collapse of the 1844 strike, the weavers wondered if there was a better way of improving their situation. They decided to form the Rochdale Equitable Pioneers Society, which started off with 28 subscribers - the original Rochdale Pioneers. They decided to begin with a shop; King had written that this should be so because:
"We must go into a shop every day to buy food and necessaries -- why then should we not go into our own shop?"
Although the Rochdale Society was not the first co-operative, it was the first really successful one, from which others took their lead.
In setting up the society, the Pioneers established a number of fundamental principles which went on to be the foundation of the co-operative movement. The original 'Rochdale Principles' were officially adopted by the International Co-operative Alliance in 1937. Updated versions were adopted in 1966 and 1995. The original principles were:
- Open membership.
- Democratic control (one person, one vote).
- Distribution of surplus in proportion to trade.
- Payment of limited interest on capital.
- Political and religious neutrality.
- Cash trading (no credit extended).
- Promotion of education.
By the end of the year the Rochdale Pioneers' Co-op store had opened for business in one small room of an old warehouse in Toad Lane, Rochdale. On sale were butter, sugar, flour, oatmeal and candles. After a slow start, the store succeeded in expanding its stock, and the Society gradually increased in membership. Trade increased to such an extent that by 1856 other branches had opened.
By 1867 the original Toad Lane shop occupied the entire warehouse; it subsequently expanded to other buildings nearby. By the 1860s the Society had accumulated 300,000 pounds in capital.
1861: Formation of The Rochdale Pioneers Land and Building Company, with the aim of constructing a superior class of dwelling for the working man. 25 houses were built for Rochdale society members. Within six years, the company built an entire co-operative estate comprising 84 houses. By the end of the century the Rochdale Society was renting out more than 300 homes at an affordable price.
The Co-operative Wholesale Society
There developed a pressing need for a federal wholesale agency, the market being one in which small co-operative societies found themselves rebuffed by private wholesalers, sometimes even boycotted, with supplies cut short or of poor quality.
1863: The Co-operative Wholesale Society (CWS) was set up to be responsible for the production and wholesale of the goods that the steadily growing number of co-operative societies needed to sell in their stores. The CWS could set up its own factories to process the food and other goods required by its customers, and control its own imports. It imported tea from India, for example, and soon had its own plantations. Before long it also owned the ships that brought its tea to Britain.
1867: The Co-operative Insurance Company was formed and in 1904, with the CWS already running a convalescent home to which retail societies could send sick members, the now Co-operative Insurance Society (CIS) started to offer death benefits. Co-op societies could now ensure that all their members were well looked after, literally from the cradle to the grave. By the 1980s, the CIS was one of the country's leading insurers, serving over four million customers.
1872: The Co-operative Bank was established, initially as the CWS Loan and Deposit Department, registered as a separate wholly owned subsidiary of CWS in 1971.
The Co-operative Union
1870: The massive success and growth of the co-op movement was a source of both pride and anxiety to its leaders. There was a worry that co-operation might be in danger of losing its original vision - that the desire to change the world could be forgotten in the midst of material success. It was agreed that the need existed for a national organisation to bind the movement together and emphasise its wider role in society; that an annual national Co-operative Congress be held; and that a central federal body be set up to which all societies could belong : the Co-operative Union.
The Union quickly established itself as the backbone of the movement; working at local, regional and national level to nurse ailing co-operative societies, it helped stamp out bad management and promote the setting up of new co-ops. It organised the yearly Co-operative Congress, and also defended the movement's interests at a national level.
The Women's Co-operative Guild
1883: Alice Acland founded the Women's Co-operative Guild. In her initial appeal to women co-op members, she wrote :
"What are men always urged to do when there is a meeting held at any place to encourage or to start co-operative institutions? Come! Help! Vote! Criticise! Act! What are women urged to do? Come and buy... That is the limit of the special work pointed out to us women!"
The Guild set out to remedy this by educating and raising the confidence of women members in their own autonomous local guilds attached to each co-op society, and later by sponsoring women as candidates for places on co-op boards of directors, sectional boards, and even as CWS directors.
Mary Llewelyn Davies was elected secretary of the Guild in 1889. In her 32 years in the post, she turned it into an effective campaigning organisation whose influence extended far beyond the co-operative movement and into the nation at large. During her time, the Guild undertook research into subjects such as female local councillors, women factory inspectors, women and labour legislation, women's suffrage, minimum wages and women's trade unions.
By 1910 the Guild had 32,000 members. As the Guild became increasingly politically active, it expanded its work beyond the British Isles. Maternity benefits were included in the 1911 National Insurance Act because of the Guild's pressure, and it also succeeded in getting the divorce laws changed so they were fairer to women. In April 1914 the Guild was involved in an International Women's Congress at The Hague, which passed a resolution totally opposing war.
The International Co-operative Alliance
1895: The International Co-operative Alliance (ICA) was established and held the first international congress in London. The ICA maintains the internationally recognised definition of a co-operative in the ‘Statement on the Co-operative Identity’. The ICA now has its headquarters in Geneva and represents 248 co-operative federations and organisations in 92 countries (2010).
The Workers Educational Association
1903: Albert Mansbridge, a CWS employee, set up the Workers Educational Association
(WEA), with its first two branches in Reading and Rochdale. The idea was for the WEA to give working-class people the chance to study, not just through a series of lectures, but also through intensive tutorial work. One of the first WEA tutors was
R.H. Tawney, one of the finest economic historians and philosophers of socialism of the century.
The WEA is currently the UK's largest voluntary sector provider of adult learning. The movement has recently been brought to prominence by Lee Hall's hit play, 'The Pitman Painters' (2007), which tells the story of Ashington miners on a WEA course who took the art world by storm in the 1930s and became internationally renowned artists.
First World War
1914: Within weeks of the outbreak of the First World War, the CWS was turning out 10,000 suits a day for the army; had stockpiled 70,000 blankets, and was working flat-out to supply the government's food needs at prices as close as possible to cost. Co-op halls got requisitioned for troops, CWS drivers went to France to drive for the army, and factories were turned over to war production. As the war continued the sacrifices became greater. The CWS agreed to pay the difference between all their employees' army pay and their co-op wages.
Such loyalty to the country, however, was not reciprocated by the government. Private traders profiteered by hoarding food and then releasing it at higher prices, so the co-op movement asked the government for a national system of rationing to control prices and give fair shares to all. The government initially refused. When rationing was eventually introduced for sugar, the Co-operative Union was refused representation on the government commission set up to control it - even though the co-op was the largest wholesaler and retailer of sugar in the land! As the historian Sidney Elliot later observed :
"Every action of the government seemed to indicate a latent hostility to co-operators, and an assumption that the only system for the distribution of commodities was that of the private merchant, wholesale dealer and shopkeeper!
The overwhelming feeling of co-operators coming out of the war was one of bitterness and anger at the way they had been treated."
The Co-operative Party
1917: Following their experiences during the war, the co-operators' view on political neutrality, which stood firm through all the previous decades against attempts to propel the movement into politics, got reversed at the Annual Congress. They now decided to seek representation in parliament and local government in their own right. The movement had never looked stronger; national membership had risen to four million, and it was by far the world's largest business enterprise under the administration of the wage-earning class. Within a year, the Co-operative Party was formed.
1918: At the general election, Alfred Waterson became the first Co-op MP, for the seat of Kettering. He immediately joined the Labour Party and became a member of the Labour parliamentary group - pre-empting the expected debate on how a Co-op MP should operate once elected.
1922: Four independent Co-op MPs were elected in the general election. Despite past votes by the annual Congress against any direct alliance with the Labour Party, it was seen that in practice this was unworkable. So the two parties worked together to produce Labour and Co-operative MPs at every election.
1927: The Labour Party conference and Co-operative Congress each passed a joint working scheme that formalised their links.
Second World War
1939: During the Second World War, CWS officials served on many advisory bodies for food and non-foods and contact with the government started well before war was declared. Despite the strong anti-war feelings the movement held in the 1930s, there was no doubting its willingness to serve the nation in this war. Co-op factories were turned over to produce goods for the war - like sandbags, aircraft parts and uniforms.
1942: A member of the London Co-operative Society tried out an idea he saw in America : take away the counter of the Co-op shop and give customers a basket, letting them wander round the store picking their own goods. They pay at a smaller counter at the exit. This revolutionary idea lifted the limits on store-size. The supermarket had arrived! By 1950, 90% of all the self-service stores in the UK were operated by co-operatives.
Independent Co-operative Commission # 1
1956: Following the co-op movement’s first-ever experience of a halt in growth after the war – caused by the massive changes in retailing following the end of rationing – an Independent Co-operative Commission was set up. The Commission sat for almost three years and recommended a drastic program of modernisation to update both practice and image. These changes, however, were slow to be carried out, and over the years major retailers like Sainsbury and Marks and Spencer emerged as serious competitors to high street co-ops.
Growth of Co-operative Housing
1974: In October 1974 the Minister for Housing (of a minority Labour government) appointed a Working Party to consider ways of encouraging housing co-operatives. At the same time a key piece of legislation for the development of co-operative housing, the Housing Act, was passed. This made available capital grants for non-profit housing schemes such as housing co-operatives.
Government encouragement and a decline in the national house-building programme resulted in many housing co-operatives being formed in the UK during the late 1970s and early 1980s. They were also a direct response to a growth in consumer consciousness: People increasingly wanted more say in matters that affected their lives, including their housing – policy, design and development. This was demonstrated by the emergence of housing action groups, tenants associations, neighbourhood/community councils and similar organisations throughout the period.
ICOM (Industrial Common Ownership Movement)
1976: In response to the a mushrooming of workers’ co-operatives, the Industrial Common Ownership Act was passed and the National Co-operative Development Agency formed. The Act aided the setting up of local authority based co-op development agencies – business advice agencies for people wishing to set up their own co-ops.
1979: The Credit Unions Act, one of the Labour government's last pieces of legislation, was passed. The Act enabled certain societies in Great Britain to be registered under the Industrial and Provident Societies Act 1965 as credit unions. Credit unions could now be formed, with lending facilities which offered lower interest rates and so provided millions of people with much-needed relief from loan-sharks.
Independent Co-operative Commission # 2
By the 1990s CWS's share of the market had declined considerably and many came to doubt the viability of the co-operative model, which was increasingly threatened by demutualisation. In 2000 the government set up another independent Co-operative Commission, chaired by John Monks, which made major recommendations for the co-operative movement, including the organisation and marketing of the retail societies. It was in this climate that, in 2000, CWS merged with the UK's second largest society, the Co-operative Retail Services, to form The Co-operative Group.
Co-operative Housing in the 2000s
While many smaller housing co-ops in the UK have demutualised and merged with larger Housing Associations the sector remains resilient. Many housing co-ops are affiliated to the Confederation of Co-operative Housing (CCH), which was constituted in 1993. CCH membership is open to all housing co-operatives, tenant-controlled housing organisations and regional federations of housing co-ops.
In recognition of the fact that co-operative housing has been a sector largely forgotten by UK housing policy makers since the 1980s CCH launched a Commission on Co-operative and Mutual Housing in 2008. The purpose of the Commission was to research the co-operative and mutual housing sector and to draw conclusions about its relevance in the current environment to national housing strategy. Its findings were published in 2009 under the title ‘Bringing Democracy Home’.
Housing co-operatives have played a major role throughout the history of the co-operative movement and are active in many countries. The potential for ‘social capital’ through the formal and informal networks fostered by co-operatives and the possible benefits for the wider community is a topical subject of research.
Compiled by Richard Brayshay - 2011