4 Comments

• Matthew Huntbach 17th Jan '12 - 11:35am

  As ever with Nick Clegg, one ends up after reading the speech thinking “OK fair enough, but where’s the real deep insight?”. Employee ownership has been a long-standing Liberal concern, featuring strongly in the Liberal Party’s attempts to build a third way when it faced being ground into extinction between Labour and the Conservatives. What’s in Nick’s speech is textbook stuff – but no more. It looks like an essay from a diligent schoolboy who’s mugged up well, said what he feels neds to be said, but it just lacks that extra sparkle, that extra something which goes beyond the textbook. “Good 2i” as we would say at university.

  The real insight I’d like to see is more engagement with the world as it is now, because like a lot of “textbook” stuff this looks like it’s based on old assumptions and the way the world was when the textbook was written and just maybe now it’s gone through umpteen editions it needs a more thorough update. I would like to see much more demonstration of critical ability, a willingness to acknowledge the arguments against. I would like to see real word insights that come from self experience and wisdom (lack of this is perhaps what makes Nick’s stuff seem so “schoolboy”, because schoolboys of their nature don’t have this real world experience). Also, try to make it a little less cliché ridden, a little less like an attempt to use what a schoolboy would think of as “clever” language.

  One of the biggest problems with employee ownership when it really is that, is that the employee goes down completely with the business. This is why I would myself be VERY wary about having my job and my investment all in that one basket. Another is the extent to which shared ownership can really work. We have the very recent example of the collapse of the Building Society movement to tell us that often people don’t really value much their shared ownership of big institutions – people were willing to give it up in this case for a small payment, most of the building societies that used to exist no longer exist, and with those few that still have this status, my certain knowledge is that most of their members don’t feel their shared ownership status means much and so don’t see it as very much different from an account with a share-holder owned institution. The reality is that most people have better things to do with their time outside their work than to engage in all that is required to be a part-owner of anything, all that reading, all those meetings (even if they would now be on-line). It’s hard enough to get people to vote in local elections, so how are wer really going to get them to be active in shareholders’ meetings?

  In practice, employee share-ownership schemes DO exist, my wife for example has a small number of Sainsbury’s shares which date back from a time years ago when she worked for Sainsbury’s and they had such a scheme. They don’t seem to mean much, the real amount in employees’ hands is tiny. I didn’t see anything from Clegg which suggested how something on a much larger scale could be initiated. So, rather than a big new idea, it looks like it might be just a near futile gesture, a way in which it could be pretended something was being done about the “evils of capitalism” which is actually just a token, rather like those payments to charities the big companies make because it makes them look or feel good.

• Tony Dawson 18th Jan '12 - 8:55am

  Was the choice of ‘still’ frame for the start of that video deliberately chosen as being more ‘Il Duce’ than ‘Il Divo’? 🙂

• Ian Sanderson (RM3) 18th Jan '12 - 11:11am

  Like Matthew, my wife has some Sanofi-Aventis shares dating from the time that she worked for Rhone-Poulenc and the French state was denationalising them. At that time employees, like her, did take an interest in the management of the company and the progress of the shares.
  I think we need to distinguish between two sorts of co-op: employee co-ops like John Lewis, and customer co-ops like the Co-op and traditional Building Societies. It’s the first sort that Nick is advocating, as improving the running of the business.
  Matthew’s point about employees having to much interest in the company is well made. In the US, it is legal for companies to invest the pension fund in their own company, which is forbidden here. A friend of mine has lost his US pension when his employer went down. British pension law restricts that abuse (though Robert Maxwell rode rough-shod over it, and Freddie Laker persuaded his employees to do it). It should be possible to incorporate suitable safeguards into a share ownership scheme.
  British law and government hasn’t really nurtured employee co-ops and customer co-ops/ mutuals enough in recent years. A really healthy economy will have a wide range of ownership models – public and private companies, sole traders, partnerships, publicly owned, employee co-ops and customer co-ops/ mutuals. Then if one of those models develops abuses, the others can move in on its market share. An ownership monoculture by PLCs, which is what we tend to at the moment, is not healthy in the long term. So we need suitable ground rules and laws to safeguard all those models and those who deal with them.

• Hinksy 22nd Feb '12 - 8:15pm

  Really think Nick needs to think this through a little more if he believes John Lewis is his model. There are no shareholders at John Lewis. See this blog.
  http://profitandtoss.blogspot.com/2012/02/nick-clegg-in-muddle-over-john-lewis.html