“What’s interesting about the swift reframing of the crisis, from a problem of bad private investment to one of bad public spending, is that it has been perfectly mirrored in policy debates about ownership and governance. References to ‘John Lewis public services’ give some hint of how warped the Coalition’s stance on mutualism has become: they want more ‘John Lewises’ in the public sector, but make no discussion of ‘John Lewises’ (or for that matter, building societies, employee-owned firms, consumer co-operatives and so on) in the private sector. Only two years ago, the state was rescuing society from the greatest failure of financial markets in 80 years, whereas now it is taking advice from business leaders about how to reform itself. Two years.
Politically, it would not be unreasonable for Labour to depict the Coalition’s public sector mutualism as two-step privatisation, unless the government can give extremely strong assurances about the asset lock. The public may just remember that Tories have a record in this area, giving building societies the right to de-mutualise in the 1986 Building Society Act. Bradford & Bingley and Northern Rock both seized on this opportunity, and the rest is history.
It would be wrong for Labour to let the Conservatives dominate this agenda for public services, not least because of the important precedent of the Foundation Trusts. But equally, the Left cannot be dragged into a debate that is limited to public service reform. If mutualism blurs the distinction between public and private sector, there must be progress made in both directions.”