Social Enteprise Needs to Think Big

In July’s heat, over an organic smoothie, an entrepreneur friend opined that social enterprise is the big idea for the 21st century.:

Here was his pitch: We are on the point of a breakthough: Key opinion-formers are joining the dots between the environment, globalisation and poverty; the idea of growth as the goal of politics is being seriously questioned; fair trade jeans are now on sale in M & S and the supermarkets are piled high with fairly traded, locally sourced goods. Bill Gates and Warren Buffett are giving away their fortunes.

In this new world the social economy is the only economy.

As my friend talked, I pondered what this might mean for jobbing entrepreneurs like you and I . Truth told, it would mean very little for our businesses. Our world is local and immediate: cash-flow; tender deadlines; silly petitions for air-conditioning…

During the third sector’s Summer of Love with Miliband and Blair, I was in the trenches trying to save one of our award-winning businesses from going bust because the public sector won’t commission fairly from us.

To save that business, my hopes are pinned on another breakthough.

I mean the breakthough for UK social enterprise if large swathes of government services become contestable.

Here, the lobbying efforts of Bland and Bubb appear to be working. But, don’t get too excited, we’re starting from the back of the grid.

The Treasury currently spends a less than 1% of its £550 billion budget through our sector, once Housing Associations are taken out. The good news is that even a small increase – another 2% or 3% - would change social enterprise forever.

This is where it could come good for Speaking Up. In a fair contest, I just know that we now would win hands-down against languid local authority services. Bring em on!

OK, maybe I’ve been drinking the same smoothies as Floyd Landis. But people often think I’m completely nuts when I proclaim the public sector as our biggest obstacle.

“We’re all on the same side, aren’t we?” I see people thinking. Well….wrong!

The public sector has thrived at our expense. It is now 43% of the UK economy up from 38% in 1997. 100,000 new public sector jobs have been created each year since 2000. Meanwhile, we’ve basically marked time.

Had public services got better, I could have lived with it. But for many of the disabled people who Speaking Up work with, life has gotten worse since 1997.

I hear similar stories wherever I go. Public largesse and social decline. Therefore we have a reason to be very angry with the public sector and, to a lesser degree, with Labour for failing to outsource to us till now..

Do we have the answers? Err, yes, actually - I think we have a good many of them. We understand efficiency. We know how to motivate people. We grasp how connect to our customers and deliver on a mission.

However, there’s one huge thing we need to improve if we’re to be the provider of choice over the big private sector. We need to learn to do scale.

Social enterprise in the public sector has to be more than the occasional nurses co-operative.

We have to conceive and achieve bigger, just like Capita and Novartis have done.

We need to move from mere gap-filling mode to market-dominance in certain sectors, such as back-to-work schemes. If all our energy goes into pilot schemes and niche-projects the large PLCs will get the big contracts, not us.

To achieve scale we need the necessary capital. And to do this we need new alliances like the deal CAN have recently done with Permira.

Without new combinations like this, the social-capital market in this country just isn’t sufficiently mature to enable us to compete. Moving into the mainstream means being as impressive as the global plc’s in terms of the investment package and overall quality of the offer.

The July heat is now a fond memory (along with that air-con petition). My friend is still trying to convince me about his breakthrough but I am too cynical to believe that we are in the midst of something epoch-changing.

Give me a decent local authority contract though, and I might start to change my mind!