← Older revision Revision as of 08:27, 16 May 2019
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"We should link up social-public partnership and [[Commons-Public Partnerships]]. The important point to highlight is that social or commons must precede the state. Our elected representatives need to become again public servants and arrogant masters need to be rapidly recalled."
 
"We should link up social-public partnership and [[Commons-Public Partnerships]]. The important point to highlight is that social or commons must precede the state. Our elected representatives need to become again public servants and arrogant masters need to be rapidly recalled."
 
(email, February 2014)
 
(email, February 2014)
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=Description=
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From a draft article by Keir Milburn and Bertie Russell:
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"Public-Common Partnerships are less a fixed institutional form, but rather a series of principles and processes that need to be designed and implemented on a largely case-by-case basis. They are not limited in their application to any particular resource or asset, although there are certain areas which will be either more pressing (such as municipal energy production) or more easily implemented (such as the Seven Sisters market) than others. In practice, there are likely to be some “stock recipes” that emerge as we become more experienced in the development of PCPs, but successful implementation will invariably require a blend of technical expertise, lived experience, and place-based knowledge. Rather than a monocultural institutional form applied indiscriminately and without connection to the needs and desires of different contexts, PCPs should emerge as an overlapping patchwork of institutions that respond to the peculiarities of the asset and the scale at which the PCP will operate (whether it be city-region wide energy production in Greater Manchester or the commercial activity of a North London market), and those individuals and communities that will act together as commoners. The very design of PCPs must therefore be a democratic one which, from the outset, considers the most effective, responsive and equitable institutional processes to facilitate us acting in common."
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(https://docs.google.com/document/d/1fOVOtMXDi57GDZP4jH4HByti-S0f69sxLqkYDfaVbCo/edit)
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=Characteristics=
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From a draft article by Keir Milburn and Bertie Russell :
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"Notwithstanding their heterogeneity, there are a handful of common ingredients that define PCPs as institutional mechanisms orientated towards the capitalization of collective self-governance:
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==Joint Enterprise==
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Conventional understandings of democratic control see the state (whether that be local, regional or national) as owning the infrastructure (such as a municipal energy company), controlling who sits on the board of directors, and benefiting from any financial surplus produced by the enterprise. In this instance, the ‘place’ of democratic activity remains located firmly in the institutions of the state, primarily through representative politics at the local/national level, in some cases coupled with processes such as the limited co-production of services or small-scope participatory budgets.
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PCPs are models of joint ownership and governance, in which the two principal parties are a state agent (such as a municipal council) and a Common Association (such as a mixed cooperative or community interest company). In the first instance, the Common Association sits on the board of directors of the Joint Enterprise alongside representatives of the local authorities and other organisations relevant to the operations of the PCP (which could variously include trade unions, the environment agency, consumer groups, independent experts and so on). Whilst there are numerous examples that demonstrate mixed approaches to the directorate of public utilities - such as the governing council of Eau de Paris (the Parisian water company that was brought back into public control in 2010), SEMAPA (the Cochabamban water company that was democratized following the Bolivian ‘water wars’ in 2000) or the Sacramento Municipal Utility District (the sixth largest community-owned energy company in the US) - there are relatively few cases in which a Common Association is a key feature.
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The structure of the Joint Enterprise produces three democratic fora:
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* The state apparatus, where the democratic act is primarily representative electoral politics;
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* The governance of the Joint Enterprise (comprised of representatives of the local authority, the Common Association, and parties appropriate to the Joint Enterprise);
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* The Common Association itself, with its own membership and independent mechanisms of participation and decision-making.
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The democratic structure and membership of the Common Association is highly contingent on the nature of the Joint Enterprise. For example, in the German town of Wolfhagen (one of the few examples of where a Common Association sits on the board of directors), a joint enterprise energy company was established between the local authority and 264 citizens that had constituted a new cooperative - BEG Wolfhagen. Whilst membership of the cooperative was initially open to any citizen of Wolfhagen that purchased a membership share, membership of the cooperative is now open to anyone who purchases their energy from the company (and thus, in the first instance, is a consumer cooperative). Whilst in some cases such a membership structure would be relatively straightforward to replicate (such as for a water utility), a community land trust, social care service or market would demand careful consideration of the most appropriate scale, legal form and membership criteria.
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==Distributed Democratic Control of Surplus Value==
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A core feature of all PCPs is the democratic control of surplus value produced through the Joint Enterprise. This feature is essential to the capitalization of collective self-governance and the wider disarticulation of the state. In the first instance, a portion of any surplus is retained by the joint enterprise to be reinvested towards its operational goals (such as delivering a zero-carbon energy supply for the city, building repairs to a market, and so on), and is thus under the collective control of the board of directors (which variously will include worker representatives, technical experts, and so on, alongside local authorities and the Common Association). Crucially however, a significant portion of surplus value would be transferred directly to the Common Association which, through its own democratic structures, are responsible for its redistribution.
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Wolfhagen’s energy partnership provides some limited inspiration for this, where shareholders in the cooperative receive an annual dividend (which was around 4% in 2016), whilst the remaining funds flow into the cooperative’s energy saving fund. Overseen by the cooperatives Energy Advisory Board (comprised of 9 cooperative members along with one each from the local energy agency, the Stadtwerk, and the municipality), the fund is then redistributed to support strategies and initiatives for increasing energy efficiency among its members. In practice, this fund has been used towards quite modest consumer oriented goals, such as providing subsidies on the purchase of electric bikes and programmable radiator thermostats.
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In the case of PCPs, where joint capitalization has been part of the process of establishing a Joint Initiative (as discussed in the forthcoming point), any dividend should be capped at the total value of the initial stake provided by members of the Common Association (e.g. those who invested a £250 membership share would receive a maximum lifetime return of £250 plus interest on that share). More significantly - and essential to the definition of a Public-Common Partnership - are the restrictions and guidelines as to how the Common Association utilizes the surplus. Unlike the Wolfhagen case, the principle usage of any surplus managed by the Common Association is to capitalize other Public-Common Partnerships without expectation of financial return.
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Whether done independently or in collaboration with other PCPs, this acts (in the first instance) as a wealth transfer to support the development of other PCPs. For example, the Common Association of a Greater Manchester Energy Company could help finance an Haringey-based Commons Association (with its own membership, democratic structures, and so on) in their purchase of the Seven Sisters market, supporting the implementation of their current community plan, whilst bringing that asset under the governance of a separate Public-Common Partnership.
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It is this centrifugal finance dynamic that allows us to emphasise the importance of thinking of PCPs not in isolation, but as part of a self-expanding circuit. For every new PCP supported through such a process, the net capacity of the circuit increases, which in turn accelerates the capitalization of further (and potentially more capital-intensive) PCPs. Not only is wealth transferred from one initiative to another, the wealth is transformed from ‘surplus value’ produced through one PCP into common use value. The net effect of this is to create an ever-expanding movement of decommodification and collective democratization, which is why we identify the underlying purpose of this circuit of PCPs as the capitalization of collective self-governance.
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==Joint Capitalization==
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Whilst not a necessary condition (in some cases assets may already be owned by the state, and thus can be transferred into a Joint Enterprise), there is an opportunity for joint capitalisation of a PCP, with the state-agent providing direct contributions, loans & underwriting of non-state contributions, and the common association most-likely contributing through crowdfunding, bonds and membership-shares (along, crucially, with inward capitalization from other PCPs). For example, the 264 citizens that established BEG Wolfhagen pursued a cooperative share offer (valued at €500 each, with a maximum of 5 per member), which raised €1.47m of the €2.3m required to gain a 25% stake in the energy company. Given the shortfall between in value between cooperative capital and the valuation of the 25% stake, the city granted the cooperative the option to gradually capitalise its stake through a loan. This further period of capitalisation took around 12 months, with the cooperative fully covering its €2.3million share by the Spring of 2013. At the end of 2016, BEG Wolfhagen had 814 members - representing almost 7% of Wolfhagen’s population - with a cooperative wealth of more than €3.9 million. Now established, any new cooperative members are given a two-year period to pay for their initial share in €20 installments, helping to broaden access to the cooperative to lower income households.
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In practice, Public-Common Partnerships begin to address two of the determining risks confronted by the GMCA in establishing an energy company - political risk and cost. The opportunity of joint capitalization, especially when this comes inwards from other PCPs, has the potential to address financial barriers (such as the establishment of the energy company infrastructure, the collective purchasing of a market building, initial subsidisation of a platform taxi cooperative, the purchasing of land for a community land trust, and so on). Whether there has been joint capitalization or not, joint enterprises also go some way to address issues of political risk. Whereas state authorities are often averse to risk-taking for fear of losing political capital - and ultimately office - joint enterprises address this through reframing initiatives as collaborations and shared experiments to be worked on."
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(https://docs.google.com/document/d/1fOVOtMXDi57GDZP4jH4HByti-S0f69sxLqkYDfaVbCo/edit)
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