Clause 2 - Community benefit societies

Part of Industrial and Provident Societies Bill – in a Public Bill Committee at 10:45 am on 13th February 2002.

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Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party 10:45 am, 13th February 2002

I shall try not to stray as widely this time as I did before, Mr. McWilliam.

I endorse the remarks of the hon. Member for Christchurch, who quotes the excellent Library brief. He is absolutely right to say that it is common practice for sponsoring organisations to recommend to their member societies the use of particular rules in order to offer the type of protection that we are trying to put on the statute book. He will agree that protection is better if it is laid down in statute, rather than if it is provided under model rules. I draw his attention to the example of the Royal British Legion clubs, which were specifically attracted to clause 2. Although the Royal British Legion has the type of rules that the hon. Gentleman is talking about, it would prefer both new and existing societies to have the benefits of the statutory protection that the clause affords and that his amendment would take away.

The hon. Member for Epsom and Ewell (Chris Grayling) made some remarks about the breadth of the clause, which I shall try to address in the clause 2

stand part debate. I accept that there are concerns about the breadth, but the specific worries that he raised are not justified because subsection (1)(c) allows enormous flexibility for community benefit societies that wish to dispose of assets.

I shall use again the example of a Royal British Legion club. If the club wanted to sell its main building, it could do that under the provisions of the clause. If the club wanted to sell part of its land, it could do that under subsection (1)(c). It could not distribute the cash that it received from the sale of the building to its members because the money must be protected for the benefit of the community.