Childcare is the perfect sector for a co-operative enterprise, as Mary Evans finds in a team effort where the rewards go to members rather than outsiders
Staff retention is always cited as a major problem facing managers of early years settings, but for one group of providers it is not an issue. Childcare co-operatives, by their very nature, are caring businesses. They care for their workforce, value them and retain them, says Margaret Lucas, co-ordinator of the recently launched National Co-operative Childcare Network. There is no single co-op format, but the basic premise is that they are owned by the members.
'Co-ops run as businesses and make a surplus,' says Co-operatives UK's national strategy director, Helen Seymour. 'It is what they do with the surplus that makes the difference: they make sure the workers have good wages and conditions and they re-invest in the services they provide. The money does not go to external shareholders.'
In a traditionally poorly paid sector, childcare co-ops can pay over the odds. For example, play assistants at the Paradise Childcare Co-op, Darlington, which runs a toddlers group, pre-school and after-school club, earn slightly over the minimum wage, says Jill Parkes, the play leader. 'We find we keep everyone. There is no great turnover in staff.'
Unlike privately owned settings, says Margaret Lucas, when the co-op's founders wish to retire or leave the enterprise is not put in peril, because the structure is sustainable. She speaks from the experience of co-founding two nursery co-ops, called Brats, in Northamptonshire, 15 years ago, which are still thriving although the three co-founders have moved on.
Mutual support
There are around 50 childcare co-operatives operating in the country. Among the oldest is Childsplay in Newcastle (see case study), which celebrated its 21st birthday in September, while one of the best known is the Sheffield Children's Centre.
Earlier this year the Oxford, Swindon and Gloucester Co-operative Society became the first co-operative society in the UK to own and run childcare services when it took over a threatened setting in Oxford. It is now building three more Neighbourhood Nurseries which will operate under the society's Imagine Childcare brand.
Each of the settings will be run by a steering group of staff, parents, carers, local childcare agencies, community partners and senior society staff, operating to policies and procedures set centrally, says childcare business manager Carol Jenkins. 'The centre will provide human resources support and financial support.' The OSG is also looking to franchise its model to other co-operative societies and has worked on a proposal to set up and run children's centres as co-ops.
The childcare co-operative network provides a mutual support group, an information bank and links to the big childcare co-operative movements in Sweden, where worker childcare co-ops are common, as well as the US and Canada, where pre-school co-ops began in 1916. The movement is like a family, says Margaret Lucas, and existing co-ops will help newcomers.
Pulling together
Whatever the model adopted, childcare lends itself to a co-operative structure because the sector is well versed in team work and aspires to be community-minded and socially responsible, according to Ms Lucas.
'I say to people, whether they are in an after-school club, pre-school or full day care, you work as a team, you have a rapport with the parents, you are halfway there. A lot of playgroups and pre-schools are co-operatives but don't know it.'
She adds, 'Predominantly they are registered as charities, because of the pre-school movement, but in some cases pre-schools are experiencing problems in finding people for their management committees.'
Setting up co-ops has enabled some after-school clubs in Nottinghamshire to overcome this problem, says the county council's development officer, Steve Collins. 'In some places we could not find sufficient people to go on the management committee. Instead of spending a lot of time trying to get people together, we suggested they set up as a workers' co-operative owning and running the club themselves.'
Under this model, parents can form a support group without having to take on the legal obligations involved in being on a management committee.
'We have about ten of these co-operatives. As a council we have supported co-operatives in other sectors for some time. We have a team of out-of- school club development workers, so it was a case of publicising the co-operative structure to them.
'They are very small - maybe only three, four or five members. They are owned, operated and managed by the workers themselves. They are registered with us as an Industrial and Provident Society. We pay their registration costs, which gives them limited liability. We provide the necessary training.'
The executive group which runs a co-op has the legal responsibilities of running the business properly and taking care of financial matters. In practice, many smaller enterprises, like the Paradise Childcare co-op, use accountants. Jill Parkes says, 'We have accountants who do our PAYE every month and we have our books audited every year by another firm of accountants.'
Nottinghamshire County Council, says Steve Collins, is now investigating how it could support the co-op movement further and help set up a co-op to provide financial and legal services for other co-ops.
Defining co-operatives
Co-operatives are based on the values of self-help, responsibility, democracy, equality, equity and solidarity. They are controlled by their members, who actively participate in agreeing policies and decision-making. Representatives are elected and are accountable to the membership. All members have an equal vote - one member, one vote.
There are various forms of co-operative in the childcare sector:
- Workers' co-ops, which are owned and controlled by the workforce
- Consumer co-ops, run by parents and carers
- Community co-ops, which provide the service for and are controlled by members of a local community
- Multi-stakeholder co-ops, which involve several interest groups such as parents, workforce, the community or an institution.
A co-operative is either registered as a limited company with Companies House, or as an Industrial and Provident Society with the Financial Services Authority. Co-op support organisations like Co-operatives UK supply model sets of rules, known as the Memorandum and Articles of Association.
Case study: Everyone has a part
When Newcastle University's Childsplay Nursery was threatened with closure, the parents rallied to rescue it. Deputy manager Diane Gregory says,'They did not want to own it as a private concern. They wanted everyone to be part of it rather than being organised for one operator. They also wanted to open it to the wider community to make it viable. They felt a co-operative best reflected the philosophy they wanted it to have.'
Childsplay re-opened as a co-op and recently celebrated its 21st birthday. Gifts underlined the nursery's ethos - children were given teddy bears wearing Childsplay T-shirts, staff received a glass key engraved 1982-2003, and parents were presented with a decorated box containing seeds and the motto, 'Nurture these seeds as we nurture your children.'
Diane says, 'Parents become members of the co-op when they register their child. Staff become members after six months continuous employment. All members have voting rights. There is an executive committee of four parents and six staff, which meets once a month.'
Day to day running is delegated to manager Veronica Welsh and Diane. A parent acts as treasurer.
Diane says, 'Once a quarter the executive committee meets the whole membership when we give a break down of operations, the finances, how the business plan is going, how any development work is going and how we are addressing any difficulties.'
In the early days attendance was high at members' meetings, when parents were buoyed up by the co-op launch, but numbers have fallen. Recently the quorum was cut. 'The parents are all busy people. We have tried all sorts of ways to attract them to meetings. We think they must be happy with the way things are going. They are kept well informed and get minutes of the meetings.'
If staff have an idea for a new initiative, basic research is done and then it is presented to the membership and discussed and further research is done. 'When the nursery was set up, the parents wanted the best for their children, and that means having a high-quality staff team. Our pay and conditions of service are comparable with the local authority. We feel parents have an understanding of the commitment of the staff because they are so closely involved. They respect us as professionals,' says Diane.
