Jericho Foundation host Cameron visit

Well, well, those canny folks at the Jericho Foundation have made tremendous PR capital out of hosting a visit today from David Cameron. Birmingham has terrific coverage of the Tory leader’s visit and the custom-made Jericho T-short he was presented with.

New report from Social Investment Task Force

The Social Investment Task Force, which has advised the government on social investment issues over the past decade, has just issued a new report. Third Sector Online has fuller coverage.

A less restrictive tax relief regime is required in order to further develop social investment in the UK, the report says, and it also calls for the introduction of a UK Community Reinvestment Act, such as exists in the US. In the US this requires banks to reinvest in the deprived neighbourhoods in which they do business. Of course, this assumes that banks are doing business in deprived communities — an issue that the New Economics Foundation has campaigned extensively on. One of the key issues — both in the US and UK — has been ‘bank flight’ from the poorest communities.

As regards CDFIs — community development finance institutions which lend in order to to generate social and financial returns — the report notes that as of March 2009 investment in these relatively new community-based financial institutions is running at only just over a quarter of the £200m total the Task Force recommended should be the aim. CDFIs attract Community Interest Tax Relief and theoretically therefore ought to be an attractive investment proposition for both individual and institutional investors. Other recent research covered here has offered a ringing endorsement of the CDFI model. In fact, I understand from colleagues in the CDFI sector that there are huge regional differentials in demand for CDFI loans from amongst conventional businesses and social enterprises.

If any of our CDFI colleagues have further thoughts on this it would be good to hear them. For instance, are social enterprises inherently and uniformly ‘loan averse’? Or is it the case that at the moment some (health and social care enterprises, for example) are able to access ‘free’ money, such as investment from the Dept of Health Social Enterprise Investment Fund, and therefore don’t require debt finance? And if this is the case, is it a good or bad thing? What’s good for the enterprise I can see may not necessarily be good for the CDFI….

Labour manifesto pledges ‘social enterprise hubs in every community’

Labour’s manifesto may not offer any new policies on the third sector, as Third Sector Online notes today, but it does pledge:

  • More support for third sector organisations bidding for public service contracts
  • Commitment to developing the long-trailed Social Investment Bank
  • An extension of the ‘right to request’ legislation currently operating in the health sector (under which workers can request that a service or department business case be properly assessed for conversion to social enterprise delivery)
  • A new commitment to ‘mutualism’, with initiatives such as ‘community shares’ used to enable the conversion of local assets — shops, pubs, football clubs and children’s centres — being converted to community-owned co-ops

Perhaps most interestingly — because there is no explanation about what this might in practise — the manifesto also says that New Labour will support the formation of ‘social enterprise Hubs’ in every community as a means of ensuring that more social enterprises ‘get off the ground’.

Scotland rethinks position on separate Social Enterprise Mark

Further to this post, Third Sector Online has an interesting item today which indicates that following negative feedback from the Scottish Social Enterprise Coalition, SENSCOT, the network for social entrepreneurs in Scotland, is rethinking its position on the Social Enterprise Mark.

Previously SENSCOT had decided not to support extension of the new ‘identifier’ Mark to Scotland, claiming that there had been political interference and that the qualifying criteria for the Mark were too lax. It wanted to develop plans for a separate Scottish version of the Mark. But the Scottish Social Enterprise Coalition has said such a tactic could be reputationally dangerous, leading to the sector in Scotland being seen as “insular and parochial, instead of enterprising and outward-looking”. Read the full story here.

When definitions obscure rather than reveal…

Further to this post, the London Rebuilding Society blog has an interesting entry by Bruce Wood, its head of enterprise services, in which he explains why all-inclusive definitions of social enterprise obscure rather than reveal what the sector has to offer. Well worth a read.

“No sh*t, Sherlock”

I was talking to someone recently about the prevalence of what they called “No sh*t, Sherlock” reports — costly reports that reach blindingly self-evident conclusions. Two new reports on ‘infrastructure support’ for the third sector seem to fall squarely into this category.

Third Sector Online has just carried a story about a new National Audit Office report, Building the Capacity of the Third Sector, and a Capacitybuilders report, Sustainable Models of Support. The NAO report, which evaluates the effectiveness of the Capacitybuilders/ChangeUP programme, concludes that insufficient thought was given to how infrastructure bodies in receipt of Capacitybuilders’ “investment” — such as Councils for Voluntary Service — would become genuinely self-sustaining in the longer term. Capacitybuilders’ own survey — based on detailed examination of nine infrastructure organisations also seems to conclude that this may be an unrealistic goal.

Capacitybuilders found that none of the providers surveyed “could describe the future of their organisations or the services they provided as 100 per cent secured beyond a horizon of two or three years”. Well, no sh*t, Sherlock. How could any other conclusion realistically make sense? That is the current reality of life in the third sector — and has been for years.

When it comes to providing real, practical, hands-on support and development — services, incidentally, which are typically free at the point of delivery — it is difficult to see how anyone with the slightest experience of the third sector could assume that this would ever offer a viable income-generating business model. One might argue that it isn’t meant to. The point of such services is to assist some of the poorest community-based organisations.

Of course, one might say that none of this would be the case if voluntary and community organisations paid for the support and development they need. And, whether openly spoken or not, it is clear that an ability to pay has been the underpinning principle guiding much of the government’s thinking about not just infrastructure support but also specialist business support such as that provided for social enterprise.

But the simple reality is that most don’t and most can’t. Those that can afford to pay have probably already voted with their feet and source the services they require from the provider/s of choice. That’s fine for those that can afford it. But for those that can’t — for the smaller or less professionalised or more volunteer-dependent organisations, those that report after report says are the ‘lifeblood of civic society’, the ‘glue that helps hold neighbourhoods together’, and all the other platitudes that the all the main political parties have been trotting out for a while now — one struggles to see how they can be helped to fulfil that role as effectively as possible unless someone is prepared to spend money on their support.

The most annoying thing about this situation is less the outright idiocy of policy-makers and more their hypocrisy — on the one hand, droning on about civil society and the need for active citizenship and voluntary involvement; on the other, the clear belief that ultimately only a market relationship matters, a sustainable business model….

Why is it that those who know least about markets  always think that market solutions are the answer to everything?

New research offers ‘ringing endorsement’ of CDFIs

New research by GHK Consulting for the Dept of Business, Innovation & Skills and the Office of the Third Sector offers a ‘ringing endorsement’ of the CDFI sector, says Bernie Morgan, CEO of the sector’s trade association. New Start covers the story here.

Community development finance institutions — a sector that in its present form is barely twelve or thirteen years old in the UK, it should be remembered — more than triple every pound they invest in local areas, according to the report. Nonetheless, like much of the social enterprise sector, the report also concludes that they remain hampered by a “lack of comprehensive data and agreed reporting frameworks”.

Our own ART is a prominent case study in the report (on p.181, which gives you a clue that it isn’t a short report….).

In late-2009 the sector’s active loan portfolio comprised around 6,500 loans — and totalled just over half of the £600m loan capital available to the sector.

Many ‘amazing’ social enterprises too small to succeed in major procurements, says NHS director of systems management

Further to this and an earlier post, Bob Ricketts, director of system management and new enterprise at DH, has stepped in to try and clear up the “misunderstanding” caused by Andy Burnham’s “NHS is the preferred provider” remarks. The story is here.

Ricketts says that social enterprises are one option in “open competition”. But interestingly he also goes on to say that “partnership”s — whether social enterprise and NHS, or NHS and commercial providers — are likely to “manage risk” better. He also says that many of the “amazing” social enterprises he has seen are too small and would need help to scale-up if they were to have a “real chance in succeeding major procurements”. And “I don’t have a solution to that,” he concludes.

Catching up… One of first social enterprises to receive investment from DH fund goes bust

I managed to miss this story first time round… Secure Healthcare, a social enterprise providing healthcare for prisoners went bust in September of last year.

Secure had a contract worth more than £5m a year with Wandsworth prison in London but went bust with debts of over £1m, forcing NHS managers to step in to protect the jobs of 70 frontline employees and ensure that the jail’s 1,600 prisoners continued to receive medical services.

According to sources quoted in the piece in the Guardian, Secure faced a ‘perfect storm’: a fixed-price contract that couldn’t be renegotiated despite spiralling costs; DH investment that was primarily restricted to capital expenditure; Futurebuilders investment ring-fenced for the development of new business; and banks’ reluctance during the credit crunch to negotiate a rescue package.

It may be old news but there are  important lessons here for social enterprises generally and especially those in public service delivery.

Social Enterprise Mentors — new networking initiative

Mark Ellerby has started a new Social Enterprise Mentors networking initiative. It revolves around the idea that social enterprises can gain a lot — and be each other’s mentors — by informal networking, information exchange and sharing experiences. The second networking event — described as a “like really good coffee break at a conference but without all the boring conference stuff” — takes place at the Urban Coffee Company (Church St, Birmingham) from 10.00–11.30am on Thursday 18th March.

Check SEM’s website for video and pictures from the first event — and lots of enthusiasm and positive comments from people who were there.

In meeting at the Urban Coffee Co. SEM is also supporting a new, independent city centre coffee house, started by two refugees from the IT industry.

New research claims the UK population of social enterprises could be as high as 232,000

Now this is interesting — and has some relevance to the question of social enterprise definitions, as we’ve debated before here, quite recently.

A recent report by Delta and IFF Research — a story covered here, and by Social Enterprise magazine, and by the FT — claims that the number of social enterprises in the UK could vastly exceed the official estimate of 62,000.

Delta/IFF claim that their research reveals that there could be as many as 232,000 businesses in the UK “which are motivated by social or environmental goals”.

I suspect that this will throw a healthy splash of fuel on the fire of the definitions debate — or maybe everyone thinks the same as one blog commenter the report quotes, Rod Schwartz who said, “Let’s spend our time growing the sector and leave it to future generations to decide what to call what we did.”

The full report can be downloaded here (look for the link — it’s half-way down on the right-hand side of the page and not immediately visible).

Social enterprise delivery of health should never be about the dismantling of universal provision

Further to this earlier post, Third Sector Online yesterday published a story in which the Government’s spokeswoman on health in the House of Lords, Baroness Thornton, stated that despite its policy that the NHS should be the preferred provider of health services, this did not mean that there was any “expectation or intention either to freeze out private or third sector providers, or to diminish their contribution to NHS services”.

Baroness Thornton was previously the chair of the Social Enterprise Coalition. Stephen Bubb, chief executive of ACEVO says he feels sorry for Thornton, claiming that she has had to “defend the indefensible”. “If the NHS is the preferred provider, then the third sector is not,” says Bubb, “and no amount of waffle and rhetoric about how great we are will cover up the fact that the Government has broken its promise to treat us on equal terms.”

I’m not entirely sure that I see Bubb’s problem with this. His vociferous criticism seems to revolve around the idea that a greater role for social enterprise and the NHS remaining the preferred provider are mutually exclusive. But is that the case?

A circular letter from the NHS chief executive David Nicholson dated 13th October 2009 and written in the wake of Andy Burnham’s speech which prompted this row seeks to clarify the position. In it Nicholson says:

“Our over-riding principle is to provide high quality care for patients delivered by providers who offer the best care. We remain committed to the participation of independent and third sector providers where this is the right model for patients – for example, where we need new services/service models, or substantial increases in capacity, or to offer increased choice to patients or to stimulate innovation.”

The letter goes on to say:

“The ‘NHS as the preferred provider’ is about getting the best care for patients and looking after the NHS staff who care for them. Our aim is to ensure that NHS staff are treated fairly and engaged in decisions, so that they know what is happening and when, what changes are being sought and why, and have a full opportunity to contribute to improving and re-designing the services that they provide. Service improvement and re-design should not be something which is imposed on NHS staff but something which they own and lead.”

Now call me old-fashioned, but I don’t find very much to disagree with there. I have never believed that social enterprise and third sector delivery of health should be — even inadvertently — about the dismantling of the NHS and its fundamental principles of universal provision. That to me would not only be counter-productive, it would be betrayal of what social enterprise is about as well as a betrayal of the NHS.

‘Co-operative PCTs — the future of the NHS?’

There is interesting coverage of new social enterprise provider Central Surrey Health in The Daily Telegraph of all places.

According to the DT there are a further twenty such social enterprises waiting to come forward under ‘right to request’.

‘Focused passion’

What do the following have in common: YouTube; Blogger; GMail? That’s right — they’re all owned by Google and they’re all free. How did an online search engine — that gives virtually all of its services away for free — grow, in just 400 weeks, into a $20 billion turnover global corporation?

I’m reading Ken Auletta’s fascinating book Googled: The End of the World as We Know It. Auletta writes on media industry matters for the New Yorker and is one of the US’s most popular business writers. He also has a clean, fluent, efficient prose style that makes his work a pleasure to read. There’s a very interesting review of the book here by the Guardian’s John Lanchester.

Auletta makes the point that the internet is probably nowhere near as revolutionary and life-changing a phenomenon as the discovery of electricity or the invention of the telephone. What is genuinely remarkable about change in the digital age, however, is its velocity, he says. And nowhere is this velocity more evident than in the Google story.

Auletta has a very interesting article here on the Fortune website in which he explains ‘ten things that Google has taught us’.

I was interested to see that ‘focused passion’ is one of the critical factors he identifies. But “without vision,” he says, “even the most focused passion is a battery without a device.” ‘Don’t be evil’ [Google’s famous corporate slogan], Auletta says,  “is a vague incantation” — but the founders’ commitment  “to make ‘all the world’s information available and to first and foremost serve users’, is a vision,” he concludes.

Certainly the Google business model is applicable in only a relatively small number of quite narrow contexts — devising an algorithm that enables your company to become the gateway to the world’s information while having to create none of it is a business strategy open to only a few. But the broader lessons Auletta identifies — about change, about putting the customer/user first, and the paramount importance of ‘focused passion’ do have wider applicability.

One thing I can guarantee: read Auletta’s book and you will never open a Google home-page again without remembering that a real, live flesh and blood business, employer of 20,100 people around the world, lies behind that familiar, even comforting (it was intended to be), six-letter brand name on your PC screen.

Highly recommended.

Social enterprise, renewables & the feed-in tariff — great market opportunity or a waste of public money?

Recently a group of us were talking about major market opportunities for social enterprise. One of the group was incredibly enthusiastic about the government’s new ‘feed-in tariff‘ scheme. This pays householders, businesses and community groups to micro-generate power from renewable sources and sell it back — at a profit — to the National Grid. Friends of the Earth have been very vocal in welcoming the scheme, one of the provisions in the Energy Bill.

What we were talking about specifically was the opportunity which this creates for social enterprises to enter the market not just for the installation of solar panels and so forth, but also for their manufacture.

And then on Tuesday 2nd March I read George Monbiot’s piece in the Guardian, “Are we really going to let ourselves be duped into this solar panel rip-off?”

Monbiot absolutely hammers the feed-in tariff scheme. According to him it will be environmentally ineffective and a waste of public money. It does nothing, Monbiot claims, except accord with the aspirations of the middle classes — the solar panel the next must-have status symbol, ideal in that it signifies both “wealth and moral superiority”.

I do love a good polemic, but my God, these environmentalists are even more vituperative in their arguments than us social enterprise folks. I would really appreciate it if some our environmentally aware readers could explain the pros and cons of this idea in easy to follow terms. Good or bad? Effective or a con? A great opportunity for social enterprise or a scandalous waste of public money? Over to you.

Social enterprise: stand up and deliver, says Guardian

Today’s Guardian includes a four-page supplement called Good Business — a social enterprise special, “paid for by the Social Investment Business, all editorial content commissioned by the Guardian, to a brief agreed with the Social Investment Business” (as the Guardian so carefully puts it).

Unfortunately, the articles that make up the supplement don’t all seem to be available on the Guardian website, but some of them are. A longish piece in which key players in the sector answer the question, “social enterprise: what next?” is here, on the Guardian blog.

The front-page article by Patrick Butler appears not to be available, which is a shame, because it contains some interesting snippets. It draws heavily on the recently launched Social Enterprise Coalition manifesto, SEC’s main campaigning tool for the forthcoming election, but in the piece Butler uses an interesting formulation.

He describes social enterprises as “for profit organisations set up to benefit the community”.

I thought that was fascinating, because in such a carefully choreographed supplement — in which one can guess that pretty much every word has been examined by a team from the Social Investment Business — the description is clearly not accidental.

Is it a helpful one?

Scotland rejects Social Enterprise Mark as a soft touch

Further to this post, and this on the new national Social Enterprise Mark — which was relaunched recently at Voice10, it seems that opinion is now divided regarding how stringent the mark is in its qualifying criteria.

While John Bird has pledged to secure the Mark so that it can appear on the front cover of every copy of The Big Issue, the Social Enterprise Coalition’s Scottish counterpart, Senscot, has declined to adopt the Mark.

In an email bulletin to its members, Senscot has said: “During last year, Senscot was in discussions with our counterparts in England about the establishment of a Social Enterprise Mark – and its implications for Scotland… towards the end of the process, more persuasive forces (probably Whitehall) have determined that the eligibility criteria for SEM should be softened – to enable it to become a high volume/quick impact instrument…. this strategy is short-sighted and not the route we would choose in Scotland.  The upshot is that, as things stand, we no longer feel able to wholeheartedly support the SEM – and intend to decline the opportunity to be the Scottish partner.”

So — is the Mark soft touch? An an easy-to-get, ‘high volume’ award more focused on a quick political return than it is public credibility and quality?

It would be great to hear what some holders of the Mark think.

on the new national Social Enterprise Mark — which was relaunched recently at Voice10, it seems that opinion is now divided regarding how stringent the mark is in its qualifying criteria.
While The Big Issue’s John Bird has pledged to secure the Mark so that it can appear on the front cover of every copy of The Big Issue, the Social Enterprise Coalition’s Scottish counterpart, Senscot, has declined to become a regional partner in the Mark.
In an email bulletin to its members, the Scottish network said: “During last year, Senscot was in discussions with our counterparts in England about the establishment of a Social Enterprise Mark (SEM) – and its implications for Scotland. We argued our corner, but towards the end of the process, more persuasive forces (probably Whitehall) have determined that the eligibility criteria for SEM should be softened – to enable it to become a high volume/quick impact instrument. Our soundings with Scottish colleagues confirm our own view – that this strategy is short-sighted and not the route we would choose in Scotland.  The upshot is that, as things stand, we no longer feel able to wholeheartedly support the SEM – and intend to decline the opportunity to be the Scottish partner.”
So — is the Mark soft touch? An an easy-to-get, ‘high volume’ award more focused on a quick political return than it is public credibnility and quality?
It would be great to hear what some holders of the Mark think.

SEC chief: “Neither fair trade nor organic alone = social enterprise”

Further to Mark Ellerby’s post on the Cadbury buy-out, I was interested to see today, in Peter Holbrook’s blog — he’s the new CEO at the Social Enterprise Coalition — these comments. Holbrook is referring to a recent piece in the Financial Times:

I love that the FT is writing about social enterprise, but I don’t love it when they call Green and Black’s a social enterprise.  They’re tasty and organic, but only one bar was ever fair trade and that was Maya Gold. Neither fair trade nor organic alone = social enterprise.

Holbrook goes on to make the point that for social enterprises the purpose of social change cannot be ‘discretionary’ — something that owners may choose to contribute to: “they should be fundamentally about social change”.

Speaking about the Social Enterprise Mark, which has just been relaunched as a national (rather than regional) Mark at Voice10, Holbrook says: “What I want the Mark to do is cut through the confusion and the misinformation”. It’s up to social enterprises, he concludes, to say what they are and what they believe.

Given the recent debates we have been engaged in — not least in the context of Call Britannia, in this post — I think a new leader at SEC who is setting out from day-one to establish some clarity regarding the aims, purpose and parameters of social enterprise is to be warmly welcomed.

Anatomy of Economic Inequality in the UK

The recent report of the National Equality Panel, An Anatomy of Economic Inequality in the UK (published by the Government Equality Office and produced by a team co-ordinated by The Centre for Analysis of Social Exclusion — CASE — at the London School of Economics) is now available to download free of charge from the CASE website here. You can download the whole thing (470pp), a summary (50pp), or an executive summary (6pp).

The sheer scale and complexity of the data makes it pretty hard to digest, but the analysis (here in the Guardian and elsewhere) is clear. Inequality begins with social origins — class; is compounded by education;  perpetuated by employment and income; and widens over the course of a lifetime.

Who knew?

It’s true that that’s a very tempting — almost irresistible — response, but make no mistake, in terms of public policy this will be a hugely influential report, not least in reinforcing the new legal duty on local authorities (introduced in the Equality Bill) to address socio-economic inequality.

And certainly some of the facts and figures do emerge powerfully. For instance, the researchers analysed the total wealth accrued by households over a lifetime. By the time they draw close to retirement (aged 55-64), the top 10% —  higher professionals —  have amassed wealth of £2.2m, including property and pension assets. The bottom 10% of households, however, led by routine manual workers, will amass less than £8,000.

New Colebridge Bus

The Colebridge Trust has just been informed by Capacitybuilders that it has been successful in securing funds to replace its mobile exhibition cum office cum consultation vehicle. The new Community Bus will replace the previous vehicle which was taken out of service last year after 23 years of service as a mobile library and community space.

The new bus should be on the road in April and is available to hire, complete with driver, by any charity, voluntary, community, social enterprise, public or private sector organisation. The bus is a highly effective way of taking your service or cause directly to the community.

Call Charles Rapson on 0121 770 8222 or email if you are interested in taking advantage of this.