Published: 03 December 2012
Extracted chapter from Griffiths, David (Ed.) Co-operators - Co-operation and Co-operatives, Southeast Housing Co-operative Ltd, 2012, pp 14-17.
I have worked for the non-profit sector for 28 years - 24 years with MIND, which was originally the Richmond Fellowship of Victoria. I subsequently worked for 18 months for Common Equity Housing Co-operative Ltd, which today has 115 co-operatives and owns over 2000 properties.
I joined SouthEast in 2010 because I had worked with co-operatives at CEHL and I believed that I had something to offer. I was originally appointed in February 2010 as a consultant accountant. In May 2010 I was appointed as Chief Financial Officer. In February 2011 I was appointed General Manager, which incorporated the responsibilities of the Chief Financial Officer.
In co-operatives, with adequate training, you see the confidence and self-esteem of directors build-on their self-belief. Their member directors, who constitute a majority, drive co-operatives. However, training and succession planning for directors needs to be in place. I like working alongside people and seeing them grow in the community and personally. You don’t see this in the private sector where people are secondary and the drivers are skewed.
In contrast, in most non-profit organisations boards are made up of professionals. Although the board may include consumer representatives, they are driven by the independent professionals.
I see SouthEast at the cusp of a potential growth opportunity if the Government is willing to provide funds. SouthEast is at that point where it needs the next step, so it benefits from economies of scale and critical mass.
This opportunity comes with the Victorian Government reviewing social housing. On 30 April 2012, the Victorian Minister for Housing, Wendy Lovell announced a public consultation on the future direction of social housing. The Minister released two papers, which bring together a range of ideas to promote public discussion:
Public consultation closed on 31 July 2012. This is an opportunity, then, for rental housing co-operatives to argue for their importance and potential. It is a challenge, however, as the significance of rental housing co-operatives is not widely understood or accepted. Yet, in metropolitan and rural areas across Victoria, rental housing co-operatives provide affordable housing to over 6,000 people, including 2,240 children, in 2,500 homes.
Rental housing co-operatives have an important role to play as part of the mix of housing options that can help to renew the social housing system in Victoria. Rental housing co-operatives have demonstrated that investment in secure and affordable housing, managed by co-operatives, and owned and controlled by their members are financially sustainable, delivering social and economic benefits for tenant members and for government. This housing helps to prevent the need for crisis accommodation and supports personal pathways out of poverty and dependency for low-income people. The report Rental housing co-operatives records high levels of tenant satisfaction with these flexible, adaptable and varied enterprises, which have capacity for innovation and growth.
The Government’s discussion paper has indicated a preference for the growth of community housing instead of public housing. There are 41 registered housing agencies in Victoria. While most are not co-operatives, the co-operatives offer unique features because they are member owned and controlled.
Viable and Sustainable
Co-operative housing is viable. SouthEast generates a surplus each year. In 2010 SouthEast secured a bank loan for the purchase of 10 properties. By June 2012 these loans had been fully paid without penalty.
The psychological (and social) benefits of the sense of ownership are interconnected with actual ownership and relate strongly to the cultural and social power of the idea of home-ownership as embodied by the ‘Australian Dream’.
There is a need to increase the diversity of housing. Cooperative Housing offers models of housing tenure which responds to other life aspirations (social, personal and ecological) and the changing (inter-)generational dynamics of the globalising and re-localising world; based on member tenant ownership and/or control.
The tenants of a co-operative are also the member owners. In co-operative housing this creates a unique sense of security.
Cooperative control is embedded in the purpose, philosophy and structure of housing co-operatives. Co-operatives ownership, therefore, strengthens a sense of place because the tenants are member-owners.
Community development is unique to co-operatives that involve the essential basis for member control - education and training of members, democratic functioning, effective meetings and good communications. Community development in a co-operative aims to empower the members of a co-operative to influence the goals and decisions of the co-operative.
The challenge for housing co-operatives is to crash through the Victorian Government’s consultation on social housing-to demonstrate that the co-operative model is already viable and sustainable, the unique features of the co-operative model and how it is important to maintain and develop this uniqueness.
SouthEast needs to be seen as a viable option and get a potential share of any growth in community housing. Although SouthEast is not a big player and not seen as a big player, we are important. Throughout the world, housing co-operatives are large and successful - 210,000 housing co-operatives with more than 18 million properties and 27 million members.
Co-operatives recognise the right of Government to regulate, but regulation needs to recognise the diversity of housing providers and their differing characteristics. Government decisions on the future of social housing need to recognise that the tenants of housing co-operatives are also members and that co-operative membership has to be voluntary, and co-operatives must retain the capacity to choose tenants who will become co-operators. If housing co-operatives were forced to accept tenants who have no interest in, and capacity for becoming co-operators, then, the integrity and cohesion of the co-operative is threatened. It will create tension between voluntary and involuntary members of the co-operative, and this will impact on operational capacity and long-term sustainability.
Growth, however, should not be at the expense of member ownership and control. As a co-operative, we need to keep members informed, provide services they deserve and have a membership that is willing to pick up the responsibility of membership as well as the benefits.
SouthEast has participated extensively in the International Year of Co-operatives 2012. We have done this because we believe that a commitment to co-operative philosophy also means a commitment to co-operative practice - by what we do and not by what we say. During IYC 2012 SEHC has:
• Co-sponsored with bankmecu the CEHL National Co-operatives Housing Conference on 8 March 2012.
• Co-sponsored the Co-operative Housing Project with other housing co-operatives.
• Commissioned The Other Way Home documentary and the advertorial Co-operation Works.
• Invited the Chief Executive and Principal of the UK Co-operative College, Mervyn Wilson to address a general meeting of members on 27 February 2012 and arranged for him to be the keynote speaker at the National Housing Co-operatives Conference.
• Attended the Australian launch of IYC 2012 on 22 November 2011 at Parliament House, Canberra, ACT.
• Attended the launch of the Australia Post stamp sheet and envelopes on 15 February 2012 in the Melbourne Town Hall.
• Arranged for a series of short films on Co-operation in Practice that feature the Chief Executive and Principal of the UK Co-operative College, Mervyn Wilson, and which look at Principles, Members, Governance, Education, Directors and Social Enterprise.
• Purchased and provided copies of the Royal Australian Mint IYC 2012 $1 Collectable Coin to directors, members and staff.
• Published this booklet Co-operators.
IYC 2012 has provided an opportunity for co-operatives and SouthEast to demonstrate the validity of the co-operative housing model. We have also reinforced our co-operative identity within the co-operative and promoted the public visibility of SouthEast.
We are not talking about a notional and untested co-operative business idea. There’s no reason why it can’t work in Australia. It’s sustainable, democratic and allows people to maximise their potential. It’s about empowering people. Unless you have stable and secure housing, I don’t see how you can deal with the rest of your life.
Ian McLaren is General Manager of the SouthEast Housing Co-operative Ltd. He joined the co-operative in 2010. Prior to joining SouthEast he worked for the non-profit sector in senior management positions for 28 years in housing and mental health. He is an accountant by profession. Prior to migrating to Australia in 1977 he worked for large multinational organisations.