The air in Westminster is thick with the smell of burning orthodoxy. News coming out of the States: a dozen small-to-mid sized businesses, ranging from a New York bakery chain to a Michigan tool manufacturer, have been sold not to private equity vultures or corporate raiders but to their own employees. This is not an act of philanthropy. It is a cold, hard calculation by retiring owners who found no buyer willing to pay what they thought their life's work was worth.
Enter the co-operative model. The UK's Employee Ownership Association is already buzzing. Its advocates are pointing to a British success story: the John Lewis Partnership. The argument is simple. Transfer ownership to staff, and you lock in productivity, loyalty, and a tax-efficient exit for the seller.
But here's the game. This is catnip for Labour. Sir Keir Starmer's team has been quietly workshopping a 'right to buy' scheme for struggling firms, partly inspired by the successful employee buyouts in the US and the co-operative movement in Spain's Mondragon. A shadow cabinet source tells me the leadership sees this as a wedge issue. "It's not nationalisation," the source said carefully. "It's empowerment. It's about giving workers a stake without the state taking control."
Treasury sources, however, are more wary. They remember the 1970s worker co-op experiments, the tail end of which ended in collapse and recrimination. One official muttered to me: "Nice idea in theory. But who finances the buyout? The banks won't touch it without a government guarantee. And that guarantee is a liability."
Inside the Department for Business, there is a quiet fascination. The US trend may be small, but it signals something bigger. The atomisation of work, the gig economy, the loneliness of the small business owner facing a corporate takeover – all of this is creating a political opening. The co-operative model is no longer a fringe dream of bearded economists. It is a pragmatic lifeboat for a generation of business owners who can't find a successor.
For the Tories, this is a trap. They dare not attack employee ownership directly. It sounds too much like they hate workers. But they fear the co-op model as a backdoor to higher taxes and collective bargaining. The right-wing press will label it 'Maoist in a cardigan'. But the polling is clear: younger voters, especially, view co-ownership as a fairer way to run a company.
Expect fireworks at the next PMQs. Labour will table a private member's bill. The Treasury will leak a memo warning of 'unforeseen fiscal risks'. The lobby will be awash with briefings, each one designed to protect a faction's flank.
One thing is certain. The whispers I am hearing from both sides of the House suggest this is not a flash in the pan. The US sale wave is being watched like hawks. If it works, it could become the new normal. And if it becomes normal, the game changes. For everyone.
