How to set up a public service mutual

By Stephen Easton

October 23, 2015

A new website offers tips on setting up public service mutuals and hosts a series of federally funded case studies demonstrating some apparently successful members of the small but growing sector.

The Business Council of Co-operatives and Mutuals, which produced the step-by-step guide, has been lobbying for governments that want to privatise public services to consider member-owned organisations.

Last year the interest group suggested governments could allow public servants to collectively buy out their own work units by turning them into employee-owned public service mutuals, in a white paper launched by then social services minister Kevin Andrews.

The Get Mutual website, which went live this week, hosts a set of “pathfinder case studies” funded by the Department of Social Services. None, of course, have spun out of government, but all provide social services to the public.

For example, Common Equity Housing Limited is a Victorian enterprise co-operative — one formed of other organisations — that has 114 separate housing co-ops as its members. This co-op made of co-ops collectively owns more than 2,200 properties worth over $700 million and provides housing for over 5000 people.

Another case study explains Co-operative Home Care, which is jointly owned by eight community care workers who also employ others. Together they provide more than 500 hours of care a week.

Earlier this year the BCCM applauded the New South Wales government’s decision to sell its home care service to Australian Unity, which is a large member-owned non-profit. That deal will make the home care workers employees of Australian Unity, not shareholders, but the BCCM also supports employee ownership, which has its own advocacy group.

The BCCM white paper suggests employee ownership by ex-bureaucrats could be appropriate for “some of the large national government agencies identified in the National Commission of Audit” which included The Mint and Australian Hearing, and “teams of specialists and carers still operating in state and territory government agencies” like the NSW home care example.

Advocates of public sector mutuals often turn to the United Kingdom and Europe for examples of their success but what began as a largely positive push under the Brown government has begun to turn sour. That has given public sector unions — which generally oppose any kind of privatisation — ammunition to attack the idea in submissions to a Senate inquiry which is due to report early next year.

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