Saturday, 20 November 2010

17. Staff Mutual Councils

As is common with many of these ideas about local democracy, the method here is to apply a model from outside of local government, in this case from the private sector, and see how it might look.   

The Staff Mutual Council could also be titled as the John Lewis Council, an idea that has been bounced around a lot but, as with many of these things, lacks a little clarity.

The idea is that local government, or at least the officer structure, can be organised in the same way as the John Lewis Partnership.  This means giving staff a direct stake in the running of council functions whether front line services or central support. Whilst recent debate has focused on the possibility of outsourcing specific services along these lines, this idea explores the possibility of arranging all of the council 'business' as a staff co-operative or mutual. 

Much of the John Lewis council debate has been about involving the public as stakeholders, a separate idea that Carl Haggerty has discussed here and the LGIU have commented on here.  As far as I am aware the John Lewis model is actually about the role of staff rather than the public and that is what this idea focuses on.

How would it work in practice?

Well, the current hierarchical officer structure would be replaced by a system in which every council employee becomes a shareholder in the organisation.    Shareholders would exercise their voting rights in branch councils which would in turn elect representatives to an authority wide staff council.  John Lewis describe their partnership council like this:

The Partnership Council embodies our democratic structure. Representing Partners as a whole, most of its members are elected by Partners. Its main role is to hold our management to account, to influence policy and to make key governance decisions. It has the power to discuss, to ask questions, and to make recommendations on any subject and elects five directors to the Partnership board. The Council has the ultimate power of dismissing the Chairman if he fails to fulfil his responsibilities.



So far so good.  There seems little reason why this could not be applied to officer structures in local government. Decision making by the staff councils would need to dovetail with the decision making of elected councillors of course.  Just as the John Lewis model excludes staff from directly deciding on core commercial issues, so the staff councils would be concerned with the implementation of policies decided by councillors, as corporate management teams are now.

The really interesting possibility is that the staff council could elect members of the Corporate Management Team. This would introduce a very different leadership dynamic for those on the officer side of council organisation.

In private partnerships the staff as shareholders can receive bonuses and this is an important incentive within in the decision making system.  In a public sector partnership it is difficult to see how a similar scheme could operate.  Financial rewards might encourage efficiency and could event help find savings if staff were able to attract a percentage as a bonus.  But how does this square with the aims of a public service provider? Perhaps bonuses could be in the form of promotions or increased influence thus encouraging a more meritocratic organisation?


However, as Neil McInroy of CLES points out, there is a rich tradition of mutualism based on achieving social good rather than private profit that can be drawn on.

‘Co-operatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, co-operative members believe in the ethical values of honesty, openness, social responsibility and caring for others’


These values, to my understanding, must be reflected in operational terms to indubitable standards of effectiveness. Standards of employment, cooperation and of service. Efficiency is not the main driver here. We must ensure the proposed flourishing of cooperatives in the deliver of public services, reflect these values and standards. For example, they cannot be a Trojan horse for inferior employment terms and conditions.


In fact, it could be argued that the staff of local councils often embody the values of public service more than the senior management do, especially where managers have been brought in from the private sector to run local authorities 'as a business'.  Giving staff a greater stake could have the effect, therefore, of strengthening, rather than weakening the public sector ethos.

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