Francis Maude, minister for the Cabinet Office, yesterday told the all party parliamentary group looking into employee ownership of public services that such such models were "the way of the future".

The group launched its report Sharing Ownership: the role of employee ownership in public service delivery, which found that employee-led ownership led to increased engagement and productivity from workers.

Chair of the group, Jesse Norman MP, said: “Mutual and co-owned models offer a hugely exciting long-term opportunity to transform the way in which many of our public services are provided, for the benefit of employees, users and the taxpayer alike.”

Maude welcomed the report and said that the government would “follow up a lot of the suggestions”.

He was impressed with some of the examples of mutual and employee ownership programmes such as the Pathfinder Programme and said: “This is, for me, the way of the future.”

Concerns

Although the shadow minister for civil society, Roberta Blackman-Woods welcomed the report and said that the Labour Party broadly supported increased employee ownership, she did have some concerns.

Blackman-Woods highlighted concerns from charities and social enterprises that the plans were “really about finances and something of a stepping stone to full-scale privatisation” of public services.

She added that safeguards were needed to protect employee rights and said the government must address this to avoid undermining the case for employee-ownership models.

More support needed

The report also highlighted the need for more government involvement to support employee ownership of public services.

It said: “The public service mutuals programme is not yet very well understood within government.”