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The Political Economy of ‘Radical’ Policy: An Analysis of the Scottish Daily News Worker Co-operative

Published online by Cambridge University Press:  27 January 2009

Keith Bradley  and
Alan Gelb
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Extract

Within six months of taking office in February 1974 Labour had funded three worker co-operatives: Meriden, Kirkby Manufacturing and the Scottish Daily News (SDN). All three ventures were the subject of considerable economic and political controversy. The Conservatives attacked them as ‘wasteful projects’ which would only encourage ‘creeping militancy’; the Daily Telegraph referred to them as a ‘diet of sub-Trotskyism’. Michael Heseltine, Conservative spokesman for Industry, attacked Labour's support for the three co-operatives, suggesting that they encouraged ‘others to follow these illegal precedents, commit national resources to wasteful projects, and create a growing sense of injustice among the overwhelming majority of hardworking, law-abiding citizens who totally fail to understand why creeping militancy should attract government support at their expense’. There was criticism too from less obviously partisan sources: the Sixth Report of the Committee on Public Expenditure, for example, concluded that worker co-operatives were non-viable and thus a waste of public money.

Type
Articles
Information
British Journal of Political Science , Volume 9 , Issue 1 , January 1979 , pp. 1 - 20
Copyright
Copyright © Cambridge University Press 1979

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References

1 The Times, 23 12 1974.Google Scholar

2 Daily Telegraph, 26 07 1974.Google Scholar See also the Financial Times, 8 11 1974.Google Scholar

3 Sixth Report from the Committee on Public Accounts (London: HMSO, October 1976, HC 584).Google Scholar

4 For a discussion of this problem see Eric Batstone and Davies, P. L., Industrial Democracy: European Experience, Two Reports Prepared for t he Industrial Democracy Committee (London: HMSO, 1976).Google Scholar

5 See prospectus, ‘Scottish News Enterprises’ (7 March 1975), p. 24Google Scholar, and the comments of the Scottish Daily News Feasibility Study (Glasgow: University of Strathclyde, 1974).Google Scholar

6 Letter from Benn, to Mackie, Allister, 24 07 1974.Google Scholar

7 Industry Act, 1972, Criteria for Assistance to Industry, Section 1.9. Quoted in Sixth Report, p. 538, our emphasis.Google Scholar

8 Prominent among pluralist works (in our sense) are: Bell, Daniel, The End of Ideology (New York: Free Press, 1961)Google Scholar; Crosland, C. A. R., The Future of Socialism (London: Jonathan Cape, 1956)Google Scholar; and Dahrendorf, Ralf, Class and Class Conflict in Industrial Society (London: Routledge and Kegan Paul, 1961).Google Scholar

9 Gretton, John, ‘To Sit or Not to Sit?’ New Society, XX (15 06 1972), 564–6Google Scholar, cites over thirty cases of worker occupations in South Lancashire alone. These involved, in total, between 25,000 and 30,000 workers. All began within a period during the spring of 1972.

10 The ample documentation setting out official Labour policy on industrial democracy includes: Industrial Democracy: A Statement by the National Executive Committee to the Annual Conference of the Labour Party (London: Labour Party, 1968)Google Scholar; Industrial Democracy (London: Labour Party Research Department, Information Paper No. 27, 02 1972)Google Scholar; Industrial Democracy: A Statement of Policy by the Trades Union Congress (London: TUC, 1974)Google Scholar; Let Us Work Together: Labour's Way out of the Crisis (Labour Party Manifesto, October 1974)Google Scholar; The Community and the Company (Labour Party Green Paper, 1974); The Inland Revenue Press Release (2 02 1978)Google Scholar, which favours profit sharing, is correctly seen as Liberal party policy. Worker participation has been advanced within an explicitly managerial framework by Flanders, Alan, The Fawley Productivity Agreement (London: Faber, 1964)Google Scholar and Collective Bargaining: Prescription for Change (London: Faber, 1964)Google Scholar; and Daniel, William W. and McIntosh, N., The Right to Manage (London: Political and Economic Planning, 1972).Google Scholar

11 Accounts of the three co-operatives all see them as arising from struggle against threatened closure: see McKay, Ron and Barr, Brian, The Scottish Daily News (London: Canongate, 1976)Google Scholar, Mackie, Allister, ‘The Scottish Daily News’ and Ken Fleet, ‘Triumph Meriden’in Coates, Ken, ed., The New Workers’ Cooperatives (London: Spokesman, 1976).Google Scholar In this respect the cooperatives differ from earlier movements towards industrial democracy, notably those in 1910–21 (Guild Socialism and Whitleyism) and in the 1940s.

12 This was most notable at Meriden where workers blockaded equipment and premises valued at £7 million. This capital was believed, by management, to be necessary to revitalize other plants at Small Heath and Wolverhampton.

13 This was certainly the case at Bendix Fisher and Upper Clyde Shipbuilders; see Clarke, Thomas, Sit-In at Bendix Fisher (Nottingham: Institute for Workers' Control, Pamphlet No. 42, 1974)Google Scholar and Thompson, Willie and Hart, Finlay, The UCS Work-In (London: Lawrence and Wishart, 1972).Google Scholar

14 Private communication between government minister and the authors, June 1977. For Benn's views on industrial democracy and on the co-operatives, see e.g. Bodington, Joan, ed., Speeches of Tony Benn (London: Spokesman, 1974)Google Scholar; Benn, Tony, ‘The Industrial Context’Google Scholar in Coates, , The New Workers Cooperatives, pp. 71–87Google Scholar; Benn, Tony, ‘Tony Benn Speaks at the IWC Rally’, Workers Control Bulletin, XXIII (1975), 6–10.Google Scholar

15 Private communication between government minister and the authors, June 1977. See also Benn, , ‘Tony Benn Speaks at the IWC Rally’, p. 7.Google Scholar

16 Private communication between government minister and the authors, June 1977.

17 See The Times, 5 03 1974Google Scholar, and Labour Party Manifesto, 02 1974, pp. 2–4.Google Scholar

18 See The Times, 4 03 1974Google Scholar: ‘The Fund was likely to ask the British Government tocommit itself to a ‘convincing policy’ to reduce the risk of wage-led inflation, particularly if most of the miners ‘demands are conceded’.

19 Conservative Party Manifesto, 02 1974, p. 41.Google Scholar

20 See Lipsey, Richard G., ‘Wage-Price Controls: How to Do a Lot of Harm by Trying to Do a Little Good’ in Walker, Michael, ed., Which Way Ahead? (Vancouver: Fraser Institute, 1977).Google Scholar

21 This paragraph rests heavily on the account of a cabinet minister to the authors, September 1977.

22 Between 1970 and February 1974 the SNP had gained six seats, four from the Conservatives and two from Labour.

23 Private communication from Benn, to the authors, 08 1977.Google Scholar

24 Private communication from government minister to the authors, June 1977.

25 As is the case in some countries, notably Sweden: see Whiting, Alan, ed., The Economics of Industrial Subsidies (London: HMSO, 1976), p. 50.Google Scholar Survey evidence revealed that the SDN workforce displayed marked reluctance to work outside the newspaper industry.

26 The impact of different leisure valuations on cost-benefit criteria is illustrated in Sen, Amartya K., ‘Control Areas and Accounting Prices: An Approach to Economic Evaluation’, Economic Journal, LXXXII (1972), 486–501.CrossRefGoogle Scholar Our procedure, of analysing government options subject to constraints on changing overall policy, accords with the spirit of Sen's paper.

27 Letter from Mackie, A. to Benn, T., 11 12 1974.Google Scholar

28 Letter from Benn, T. to Mackie, A., 25 07 1974.Google Scholar

29 See the minutes of the SDN Executive Council, 1 September 1975. See also the memorandum to directors from R.Durnin, financial controller, 9 September 1975: ‘they [the Department of Industry] will under no circumstances take the legal onus off the Directors of the Company’.

30 Scottish Daily Express sales fell by a reported 150,000 following its move to Manchester, but only temporarily.

31 We are indebted to Chris Trinder for providing us with these figures.

32 See e.g. Herron, FrankLabour Market in Crisis (London: Macmillan, 1975).Google Scholar For an appreciation of the dire straits of the newspaper industry in particular, see Royal Commission on the Press, Interim Report (London: HMSO, Cmnd. 6433, 1976).Google Scholar

33 Consider, for example, the mass vote by which Maxwell was re-instated as Chairman: for Maxwell 295, against 12, abstentions 8. The greater weight given by SDN workers to pragmatic as opposed to ideological considerations is the subject of a further paper.

34 This conclusion assumes that the other projects did not have to employ the factors (labour, capital) employed by the SDN. However this seems a very reasonable assumption: no such alternative uses for SDN factors was ever proposed to our knowledge. There were, after all, many other British unemployed, particularly in Glasgow.

35 For cost-benefit studies using distribution-weighted criteria see Little, Ian M.D. and Scott, Maurice FG., Using Shadow Prices (London: Heinemann, 1976).Google Scholar

36 This assumption is suggested by the Scottish Daily News Feasibility Study (Glasgow: University of Strathclyde, 1974), Section 8.1.Google Scholar

37 McKay, and Barr, , Scottish Daily News, p. 9.Google Scholar

38 The negative revenue effect depends on the extent to which SDN capital losses could be offset against capital gains. As the majority of shareholders did not possess other shares, the scope for such offsetting would probably have been limited to the larger shareholders.

39 McKay, and Barr, , Scottish Daily News, pp. 32–3.Google Scholar

40 Such computations appear in The Times, Guardian and The Financial Times of 22 03 1976.Google Scholar