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Co-op members have expressed horror at bosses’ decision to sell off its agricultural wing and “to consider the future” of its pharmacy business as the group looks set for a £2 billion loss.
Leading co-operative movement activist and former Labour European MP Michael McGowan warned that the historic movement launched in Rochdale in Lancashire in 1844 was facing its worst-ever crisis.
Co-op’s losses follow catastrophic errors by senior executives, including the failed takeover of hundreds of branches of Lloyds bank by Co-op Bank. Those errors alone left the group facing a £1.5bn loss.
The business also owns 14 farms covering 50,000 acres, an agricultural operation dating from 1896 but now up for sale.
And the pharmacy section is one of Britain’s three biggest pharmacy chains, with 6,500 staff.
Mr McGowan, a member of the Leeds and Wakefield area committee of the Co-op, slammed the decision to sell the farming wing and described the Co-op’s position as “the worst crisis in the history of the co-operative movement.”
He said: “It highlights once more the failure of the directors of the Co-op Group to accept their responsibilities to hold to account and control professional managers.
“The decision to sell off the Co-op farms and the manner of the announcement suggests that both the directors and the executives should consider their positions.”
Staff hit by the sale only learned of the decision from the media, Mr McGowan said.
“The failure of governance has resulted in the Co-op Group facing an enormous debt which has to be addressed, has destroyed the Co-op Bank, and has damaged the reputation of the co-operative movement.”
He added that Co-op members and elected committees were not consulted, and called for dialogue with elected area committees “as a matter of urgency.”
In December 2013, the bank was bailed out by allowing private finance into the banking operation, meaning that it was no longer a co-operative.
Group members are running a nationwide campaign to stop the banking arm abandoning its “ethical” status.
