Geraint Talfan Davies connects two far-reaching recent conferences
The espousal of ‘the new mutualism’ by Andrew Davies, the Welsh Finance Minister and Edwina Hart’s campaign manager, should make interesting reading for Newport University’s Institute of Advanced Broadcasting – which is currently exploring new business models in the world of digital media – as well as the DCMS in London. Why so?
Andrew Davies set out his view at an IWA conference on the new mutualism at Cardiff University (30.10.09). This explored both the history of mutualism in the UK, and the opportunities for extending it at a time when more aggressive capitalist models are looking distinctly unpopular in the wake of the global financial crisis.
His views are no doubt shaped in part by the financial pressures he and his Welsh Government colleagues are now facing. If public expenditure is to take the hit that is now widely expected, they will have little option but to find ways of bringing private capital into play. The mutual model may be a way of doing so that is politically more palatable to the left of centre coalitions that are likely to govern Wales for the foreseeable future.
At the IWA conference, Peter Griffiths, Chief Executive of the Principality Building Society, and Duncan Forbes of the Bron Afon Housing Association in Torfaen, both extolled the mutual nature of their own organisations. The Principality has weathered the financial storm rather better than those building societies that de-mutualised in recent decades.
Chris Jones, Finance Director of Glas Cymru, owners of the not-for-profit Welsh Water which is a mutual in ethos if not strictly in form, pointed to the substantial bond finance on which the Glas Cymru was launched in 2001, a notion that has now spawned the concept of a ‘Welsh housing bond’ now being worked on by Welsh government officials. Policy makers are also examining its relevance for rail development in south east Wales.
What has this got to do with the Institute of Advanced Broadcasting? A few days after the IWA’s conference on mutualism, the IAB held a conference on ‘micro-broadcasting’ (4.11.09) which drew a big audience from the IT/broadband sector, rather than the traditional broadcasters. The IAB is in harness with the Wesley Clover Corporation and Move Networks to conduct an experiment in Blaenau Gwent to see how a more advanced technology can reduce the number of broadband refuseniks in the area, currently more than half the population.
By installing the Inuk technology, that delivers high definition pictures to computers, in the homes of 5 per cent of the population, they not only hope to explore the behaviour of the public and the potential for small community media, but also to develop new business models.
Asked by the organisers to give a view on the future I ventured to suggest that if mutual models have a natural role, it is surely in the field of communications – micro-broadcasting, community radio, local television, even the independently financed news consortia by which a news service for ITV in Wales are likely to be delivered in future. Ownership structures that lie somewhere between the market and the state, not dominated by either, are surely a better way to deliver a long term public service than the unsustainable slash and burn management that often results from the pressure to sustain a particular share price. We need to explore how to incentivise these models.
The possible tendering of a news service for ITV Wales would be an ideal place to innovate – something that prospective bidders, Ofcom and the DCMS might take into account. How can you draw in private capital, yet shield the service from the endless cost-cutting pressures that have been a feature of recent years.
We do seem to be experiencing a paradoxical disjunction: systems of regulation, whether in energy or telecoms or broadcasting, that are increasingly market driven, at the very point when market models of ownership, as deliverers of long term public ends, are most in question: whether its Northern Rock, HBOS, Trinity Mirror, ITV, or Qinetic.
In recent times broadcasters and arts organisations have been enjoined to seek new business models – usually a euphemism for reducing public funding. Very often it is a vain search for the holy grail. In digital media it has been a quest for monetisation of an activity. Until now ownership has received much less attention.
As we were reminded at the IWA conference, new business models may be a re-working of older models. Since the beginnings of the industrial revolution, Wales has made a rich contribution to concepts of free association and the public good: Robert Owen of Newtown, one of the founders of the cooperative movement; the record of Welsh miners and their communities in establishing mutual organisations for social, educational and cultural purposes; the Tower Colliery cooperative and, dare I say, the fact that Wales has the only not-for-profit water company in England and Wales.
In England, too, you have the 19th Century tradition of municipal enterprise, delivering public goods, along side robust capitalism. It is no surprise, either, that the Scott Trust – the trust that owns the Guardian and the Observer – had its roots in Manchester. Today the partnership offerings made by the BBC to other broadcasters mirror the helpful asset transfers that are increasingly sought by community groups from local authorities – the donation of a disused building or plot of land.
As the IAB and its partners seek new business models they may need to look to our history, to distinguish clearly between private and public purposes and to choose their models accordingly.