Chancellor must use alternatives to the 'pre-crash economic toolkit' to bring genuine growth to the UK

The Government must create economic policies that support Britain's emerging social economy if it is to address the rising cost of living and growing inequality in the UK, according to The Social Economy Alliance. The campaigning group, made up of 22 respected co-operative and social enterprises, universities, think tanks, charities and housing associations, says that businesses that plough profit into people and society are the best defence against long term, phony growth in the economy.  

The Alliance welcomed the Chancellor’s comments on mutually-owned business models. But the group said that the Chancellor must use alternatives to the 'pre-crash economic toolkit' to bring genuine growth to the UK and avoid setting the economy on the road to further trouble. The Alliance warned that growth figures released in today's Autumn Statement represent a 'make or break moment', where the Government must resist the temptation to return to a debt-fuelled growth model that doesn't improve standards of living for all.  

During the financial crisis, co-operative and social enterprises have been resilient and have outstripped ordinary business for growth and innovation. Alternative banks have shown better returns. The Alliance said that the Government should now show its full support to the UK's emerging socially-driven economy.   

The Alliance is calling for bottom-up economic growth using alternative social economy policies that support, for example, community energy production, credit unions, crowd-funding and alternative banks, social enterprise housing groups and other social ownership models, and has commented on  a number of areas covered by the Chancellor’s statement: 

Housing – the sell off 

The public sector does need to free up land for more housing,  but one-off cash payments from the highest bidder must be avoided. The Alliance believes that the Public Services (Social Value) Act should be extended to cover management and disposal of assets to ensure that taxpayer-owned land benefits local communities long into the future.  

Public services – the A&E crisis 

Support for Accident and Emergency rooms is necessary, but the government can reduce the need for bailouts by investing in preventative health care strategies implemented within communities. 

Business rate freeze 

Freezing business rates is to be welcomed, but more support should be concentrated on SMEs, social enterprises and cooperatives, that are regenerating high streets and local areas and delivering long-term social and economic value. 

Andrew Croft, CEO CAN and member of the Alliance, said: 

“A thriving economy is our main weapon in the fight to improve living standards and conditions for people in Britain. But economic growth does not automatically equal a more prosperous society – smart economic policies that are based on the inextricable relationship between people, communities and the economy are essential.” 

“We’re calling for support for the advanced solutions emerging from the social economy – social enterprises, cooperatives and other socially-owned businesses are improving social as well as economic conditions, by putting power in the hands of the people. 

“Attempts to fix broken markets with outdated economic models will be extremely harmful. We need alternatives that work within markets to shift the very plates they’re built upon, to create economic and social advances that put people and communities first.  This is basic stuff – but our leaders are yet to fully grasp and champion the social economy solutions that already exist in the UK”.

Download the full Autumn Statement.