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I shall keep my comments rather shorter than planned because I see how many Member still hope to speak, and I join those who have congratulated
I must declare an interest because I am a member of Midcounties Co-operative, although the House may not be entirely surprised to learn that, unlike
As businesses that are owned and run by members, the decision-making process in co-operatives is important, and I am instinctively sympathetic to many principles that the hon. Member for Cardiff North seeks to advance in the Bill. The global challenge of climate change, and changes to our environment at global and local level, are some of the most pressing challenges of our time, and they must be addressed at all levels. As has been said, there is a clear need for action at Government level to support investment in environmentally sustainable and green schemes. Five years ago, the London Stock Exchange became the first stock exchange in the world to launch a green bond segment, which it followed last autumn with its green economy mark and sustainable bond market. That was to find channels, generally at larger company level, to support investment in businesses that are pursuing many of the environmentally sustainable goals that the hon. Lady sets out in proposed new section 29A.
There is a role for community vehicles, and co-operatives and community benefit societies are in a strong place to fulfil much of that, generally as lower-scale vehicles that conduct practical work at community level. It is therefore right to look at where legislative and regulatory restrictions prevent such work. Some ideas are raised in the Bill that I very much hope, if the Bill is not successful today, the Government will take away to see how they can be brought back in a form that can be progressed. There are some shortcomings in the Bill that would cause concern and that have, as was referred to earlier, attracted concern from much of the co-operative movement, while generally strongly supporting the need for legislative support.
Without repeating what the Minister said, much of it comes back to the wish both to advance a vehicle for green investment through co-operatives and to introduce some of the fundamental reforms of co-operatives, in measures on tax loopholes and the obstacles to conversion into companies. Clearly, those two issues are related, but they are quite distinct. In trying to tackle them both in the way set out in the Bill, there is a danger of not quite doing either well—of either being too restrictive or too extensive.
As a Midcounties Co-operative member, I am instinctively somebody who thinks that the best way of making decisions over a mutual organisation is for the members to have the power to take those decisions. I am not convinced of the pressing need to have legislative measures to prevent the conversion, but if there is evidence of high risk or severe harm it seems that it probably applies to co-operatives more generally, rather than simply those that could be taking advantage of these green share provisions. That needs to be addressed more broadly for co-operatives and community benefit societies, rather than as part of a measure that predominantly concerns financial vehicles.
Similarly, I share many of the views that have been set out on whether restricting the Bill to purely green shares—to environmentally sustainable investments, rather than other socially beneficial ones that co-operatives in particular, and other community benefit societies may wish to facilitate—is potentially too restrictive. There is a danger from a consumer protection point of view that by confining it narrowly it almost acts as an accreditation scheme for the investment, in a way that neither the Government nor the Treasury is really in a position to be accrediting any such scheme more generally.
Hon. Members on both sides of the House will have plenty of experience of the anger of many of our constituents who may have been Lloyd’s names, and who felt that the Government—or, rather, successive Governments—failed to intervene adequately. If we are legislating in such a narrow way to allow for a specific type of investment that we approve of, adding apparent Government backing to them carries real risk of financial losses, where the liabilities could be enormous.
Many years ago, while I was working for a sustainable energy membership organisation, I was involved in helping to conduct a very large piece of work on behalf of the then Government on green investment, particularly on household-generated energy, looking at incentives, attitude to energy and what might make the difference in consumer behaviour. While even then, more than a decade ago, there was clearly a lot of appetite among consumers to support the green agenda, it did come down to an expectation of a financial return in actually quite a short timeframe. I think that the majority of people who may be interested in investing through vehicles such as those the hon. Member for Cardiff North is looking to facilitate will have a similar expectation of a decent return on a relatively short-to-medium timescale. We would have to ensure that such vehicles were financially sound as well as pursuing a clear environmentally and socially beneficial agenda.
I will leave it there, because other hon. Members will wish to speak. I know my hon. Friend the Economic Secretary to the Treasury will have been listening to the support for co-operatives and vehicles to allow for such environmentally supportive investment, and I hope the Treasury will look at how we can take the agenda forward together.