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Social enterprise summit

SOCIAL ENTERPRISE SUMMIT 12TH MAY 2009

  

 "The summit was a positive and productive meeting between Government ministers and social enterprise leaders, and a welcome opportunity to work together to join up different government departments' agendas on social enterprise."

Jonathan Bland, Chief Executive of the Social Enterprise Coalition

  

This paper is a brief note of the discussion on social enterprise in the economy with five Ministers (Lord Mandelson, Liam Byrne, Hazel Blears, James Purnell and Kevin Brennan) and includes the announcements made by government as a result of the Summit. It does not fully capture the richness of the debate but represents where we got to.

  

The discussion

The Social Enterprise Summit was based on four key themes. Social enterprise leaders put to the Ministers several ideas to enable social enterprise to maximize its impact on the recession.

1. Fighting the recession

  • An asset acquisition fund of £100 million, to build on the Community Builders Fund. The ownership of assets by social enterprises was identified as a success factor in creating social enterprises that generate sustainable wealth and employment often in the most deprived communities.
  • The Future Jobs Fund. Recognition of social enterprise as a delivery agent of the Fund was welcomed. But the design and implementation of the Fund has to help social enterprises to bid for these jobs.
  • Tax relief: for example paralleling gift aid, and collective structures to get same tax incentives as individuals
  • Restrictive covenants on public assets to be relaxed to allow enterprises to trade and develop from them
  • A ‘Hit Squad' of experienced social entrepreneurs to support communities to take on assets

  

2. Social enterprise in a rebalanced economy

  • Use of government purchasing power to promote the creation of new social enterprises as vehicles to deliver public services. Smarter and more strategic commissioning will avoid creating insurmountable barriers to entry.
  • More balanced financial services with community reinvestment obligations placed on mainstream lenders to ensure that their services meet the needs of all communities.
  • A stakeholder takeover scheme to rescue businesses: MACORA law translated to UK situation.
  • Peer-to-peer skills of the movement to be included within the Business Link single offer.
  • PFI Special Purpose Vehicles to be turned into social enterprises where they are struggling (and government has propped them up), allowing investors to get a return but assets locked for community.

 

3. Attracting new blood

  • Proactive and specialised forms of business support to support new social entrepreneurs - providing them with support so they can realise their ambitions.
  • RDAs to fully embed social enterprise into their economic strategies
  • Generation Y - promote SE internships as part of degrees
     

4. Scaling up

  • An underdeveloped and fragmented social investment market is a key barrier to the growth of the sector.
  • A Social Investment Wholesaler is needed to capitalise the social investment market
  • Reforming the rules governing tax and investment in CDFIs will increase their capacity to serve their communities more effectively.
  • Embedded endorsement across government and down to RDAs is needed.

 

Announcements made by government

OTS

  • A new Ministerial Working Group, chaired by Liam Byrne, Minister for the Cabinet Office, will ensure a level playing field for social enterprises and charities to compete for specific public service delivery contracts, furthering the Government's commitment to create 25,000 new jobs in social enterprises and charities.
  • A cross government ‘social enterprise growth and development forum' is being set up. This forum will take the actions from the summit forward. The Coalition will be part of this forum and the first meeting is scheduled for early June.
  • A new Guide to Social Return of Investment will equip public service leaders with the tools to understand the social value that social enterprises can bring to local society, when they deliver services.
  • The new Futurebuilders Investment Plan setting out how £45.6 million of public money this year will help social enterprises deliver public services, through a new fast-track investment process.

 

BERR

  • CDFIs will be able to access up to £20m of bank loans due to changes to the Enterprise Finance Guarantee (EFG).

 

DWP

  • Support will be given to those wishing to become self employed. Working with Business Link, government will provide training and support to help people set up their business. In addition, for those customers who move from benefit into self-employment a new self-employment credit of £50 a week will be made available for up to 16 weeks.

 

OTS, in consultation with BERR, DWP and DCLG, will produce a short report (maximum 3 pages) which will cover the key issues discussed at the summit; the main challenges identified; and the any actions/outcomes for the government and the sector.  The report will be made available on the OTS website on Friday.

 

SEC: next steps

Following yesterday's summit, the Social Enterprise Coalition will be writing a paper to government covering all of the recommendations made by the movement. 

We hope that we continue to see positive results coming out of the summit, and will be keeping members and the wider movement involved in and informed of any further developments.