Transcript National Mainstreaming Partnership

UK government policy on social enterprise
and public procurement
Jonathan Bland
1
UK definition of social enterprise
A business with primarily
social objectives whose
surpluses are principally
reinvested for that
purpose in the business
or in the community,
rather than being driven
by the need to maximise
profit for shareholders
and owners
• http://www.flags.net/image
s/largeflags/UNKG1027.GIF
2
Social Enterprises in the UK
62,000 businesses, £24B, 800,000 employees
3
Characteristics
•
•
•
•
•
•
Clearly defined social
purpose
Trading in the market
Limited profit
distribution
Ownership structures
Transparency
Triple bottom line
4
UK has a broad approach
Many Legal forms:
– Companies
– Community interest
Company
– Community Benefit
Societies
– Co-operatives
– Charities (tax status)
5
A successful business model
Different routes to
social enterprise:
•
•
•
•
NGO’s doing business
Public sector
externalisations
New start value driven
businesses
Private business
conversions
6
UK Government Policy framework - a
decade of development
•
•
•
•
•
Productivity and
competiveness
Socially inclusive
wealth creation
Regeneration of local
neighbourhoods
New ways to deliver
public services
Inclusive society
A series of UK Government policies have been developed since 1999
7
UK Government policies and procurement
•
•
Main focus has been
around public service
reforms
Some local public
authorities have used
procurement for wider
objectives e.g.
employment
8
SE in public service markets
• Split between provider
and commissioner
•Developing markets
• Social enterprises as
new providers
• Changing role of NGOS
and new social
enterprises
9
Support measures for health and care SE’s
•Commissioning
frameworks
•Third sector policies,
Future builders
•Social Enterprise Unit
• £100m Social Enterprise
Investment Fund (SEIF)
• Right to Request (R2R)
programme
10
Social enterprises delivering social care
• Social enterprises operate across a wide ranges of types of
care: domiciliary, residential, special needs
• 50% of all funding to voluntary sector by local government is
for social services
• In social services Voluntary and Community Sector
organisations get 88% of income in contracts or fees
• 1 in 10 community interest companies deliver social care
• 2007/8 local authorities spent £20.7b on care (12b in market
of private and third sector providers)
• Growth in third sector care workforce from 202 000 in 1996 to
to 374 000 in 2008 (614 000 in private sector, 424 000 in
public bodies)
11
Department of Health “Right To Request”
programme in primary health care
• Staff, who transfer, keep
NHS pension
• Support: advice and
funding
• Uncontested contract for
up to 5 years
• Large organisations of
3000 staff to a group of 5
nurses
12
The Current Coalition Government
•Commitment to social
enterprise in public service
delivery
•Deficit – much less money
•Smaller role for the state
•Big Society Agenda
13
Current Government policies
•Greater role for co-ops, mutuals
charities and social enterprises
•Public sector workers given the right
to form employee led co-operatives to
bid to run services (Right to provide)
•Big Society Capital – money from
dormant bank accounts
•Communities “right to challenge” to
state run services (Localism Bill)
14
Community Benefit clauses
•Use in public procurements to achieve wider
objectives - not wide spread but staring to grow
•Most developed in Scotland, being actively
promoted by Scottish Government.
•Pilot has been carried: construction and social care
•Focus on integration into labour market of
disadvantaged groups
15
Public Services (Social Enterprise and Social
Value) Bill 2010-11 •places a duty on the Secretary of State to publish a 'national social enterprise
strategy' to encourage engagement in social enterprise.
• amends Section 4 of the Local Government Act 2000 so that local authorities
are required to include in their sustainable community strategy proposals for
promoting engagement with social enterprise in their area.
•They must also include a statement of the measures suggested to enable
social enterprise to participate in implementing these proposals requires local
authorities, when entering into public procurement contracts, to give greater
consideration to economic, social or environmental wellbeing during the preprocurement stage.
It is a private members bill with support from the government – it may get
watered down
16
Rhetoric and reality – challenges & issues
•European Laws on Procurement and state aid
•It really depends on how markets develop – requires market
management by public commissioners
•But ….. tendency to bundle contracts, focus on a few large
providers and on lowest price
•Perception of risk, transfer of risk
•Implications of payments by results
•Social enterprise capacity for growth
•Access to Finance
17
Thank You!
• +44 203 372 2878
• +358 400 - 430730
• [email protected]
• www.socialbusinessint.com
18