Amid the fear, the health risks and the terrible prospect of many thousands of fatalities, the Government seems to be stumbling around, from herd immunity one week to isolation the next and from a Brown-style Budget one day to Corbyn-scale investment another. The FTSE has fallen by a third. Even Robert Peston – back on his familiar territory of systemic risk – doesn’t seem sure where we’re heading.
But it seems inevitable that this dreadful pandemic will have significant and far-reaching consequences for our society and our economy. As James Meadway, former adviser to the Shadow Chancellor, argues persuasively here, “this crisis will require more than money to resolve; it will require the reshaping and restructuring of our economy”. Meadway sets out some ideas for dealing with immediate crisis but he also argues that we need to “show the path to the future and think of new ways of living and working, of rebuilding our social spaces and public services.” Meanwhile, Neal Lawson of Compass also suggests that most of us have never experienced anything like this and that “this changes everything”.
But how will everything change? What might this fundamental restructuring look like?
Globally, the focus so far has been on top-down, state-led, national emergency measures. Right-wing governments are now adopting ideas which many on the left have been calling for. What once seemed like policies for an unrealistic, distant utopia now sound more like ideas for a terrifyingly realistic, imminent dystopia. A Universal Basic Income, which in normal times, seemed too expensive, too unconditional and too universal, now seems essential. The Danish state is paying 75% of workers’ wages, the Swedish state is guaranteeing 90% of the income of workers laid off. Elsewhere, industry is being shut down, steered by government or even nationalised. The Spanish Government has requisitioned its private healthcare sector.
This is the state stepping in to protect people in response to a crisis. Putting the country on a war footing. But is this the path to the future?
As Neal Lawson says we need “both top-down state emergency action and bottom-up capacity and resilience building.” People such as Meadway and Lawson – who are indeed good friends of social enterprise – have often championed the emergence of a new economy – more collaborative, more co-operative and more human. But specifics are often left unsaid. So at risk of being totally wrong, can we go further and start to describe the new structures and new paths that could and should emerge around us?
Will a renewed sense of mutualism and co-operation only exist as a feature of “life during wartime”, or can this become part of a “new normal”? Just as modern UK welfarism grew out of the wreckage of WW2, we may well discover ways of living that are forged out of crisis and resilience, but which then lead to something better, built from the ashes. What might emerge and then evolve in a new, more collaborative and resilient economy?
- Mutual aid – across the country, hundreds of new, mutual aid groups have already sprung up in just a few days. Covid Mutual Aid UK is a group of volunteers supporting local community groups to organise throughout the UK, connecting people to their nearest groups. These groups could solidify into more stable and sustainable collective buying clubs, food exchanges and consumer co-operatives – for food and fuel, for instance – keeping prices down for those struggling to get by.
- Healthcare Workers Childcare Co-ops – as schools and nurseries are closed but parents who are healthcare workers are needed more than ever, new co-operatives are springing up, bringing together those who need help looking after children with those who are able to, matching people in an area. They could start to reach beyond childcare, to social care, to shopping and into the labour market.
- Delivery services – cafés, restaurants and pubs are closing down and shifting to home deliveries. Local businesses could work together to develop fairer, more sustainable alternatives to the VC-backed, loss-making Uber Eats and Delveroo, unionised, paying fair wages and taxes, recycling profits in communities.
- Free stuff – some big businesses , from Sky to Headspace to the New York Times, have turned their models upside down in response to the crisis. Online subscription services are temporarily offering free content or free trials. Maybe these could evolve into crowdfunded, donation-based, pay-what-you-like or pay-what-you-can models, which we know from Wikipedia and elsewhere.
- Wi-Fi for all – nevermind Broadband Communism, dozens of companies are already offering free wi-fi to enable access for those without the internet. Community wi-fi initiatives can offer local, sustainable alternatives, and simple acts of sharing amongst ourselves can help overcome digital divides.
- ‘Pre-tailing’ – Crowdfunder has launched a free campaign for business to raise cash on their website, through a Pay it Forward campaign, which enables customers to book – and pay – now for meals, rooms or tickets, to be delivered in the future, helping businesses with their cashflow. This model of ‘pre-tailing’ may start to replace other forms of up-front investment, changing the shape of the finance industry.
- Business with a purpose – as Louis Vuitton and Brewdog move from fashion and beer to hand sanitizer, more businesses are starting to see connections between social need and commercial opportunity. Is this the crest or just the start of a wave? The crisis may end up sorting the genuinely virtuous from the virtue signallers.
- Anchor institutions – universities, schools, colleges and hospitals are closing or shifting towards only essential provision, sometimes acting with agility on their own without government orders to take greater responsibility for our collective welfare beyond their narrow, planned, statutory duties. As they re-open over time, could this have a lasting impact, engraining a more flexible, more responsive culture, more led by the needs of the communities they serve?
- Fan-run sports clubs – hundreds of football clubs now face ruin. But with time, as football kicks off again, bankrupt clubs will build from the ground up. Fans will run the club, the bar, choose the kit, appoint the Board and bring their kids and their partners along on matchday. Football reformed on a more sustainable and community-focused basis, more than a club.
- Re-occupying spaces – people in California are reclaiming empty homes and the UK Government is considering plans for opening up empty hotel rooms to the homeless and already adjusting planning laws. If empty shops can be repurposed, our high streets and town centres will look very different after the crisis, bringing life back to the heart of our communities in time.
- Community culture – with the film and cinema industry in crisis, will we ever return to the days when it cost $300m to make Pirates of the Caribbean? We may see more communities voting for the films, shows and plays they want to see on the village green, in the community hall or in the car park.
- Community-owned assets – as pubs, theatres and galleries, clubs and museums close for the crisis, our social infrastructure collapses. When will they reopen? Will they? Local communities can slap an Asset of Community Value status on any precious local building, giving them space and time to take ownership of the places they value and prevent them from being sold off to private landlords. Existing community co-ops and trusts could form local umbrella societies to help guide threatened assets into community ownership and provide the patient capital for community bail-outs.
- Less new stuff – as the FTSE falls, incomes freeze and pension funds creak, we will need to do more with less. We will need to rediscover greater value in waste and recycling, with the rise of wood recycling, IT recycling, charity shops and furniture recycling, scrapstores, toy libraries, repair cafés and tool libraries in every community.
We have some of this already, of course. We call it the social economy.
Social enterprises, co-operatives, trading charities, community businesses, leisure trusts and mutual are in every town and city in the country. They are worth £60 billion to the UK economy and employ two million people, or 3% of GDP. This is 5% of employment and three times the size of the agriculture industry.
But these models are not everywhere, yet. Some are very fragile. Too often, they are ignored by policymakers. Some – those businesses already wired into the existing economy – are about to collapse right now, while others may prove to be especially resilient. In the last financial crisis, the Nationwide Building Society, for example, stepped up to play a bigger role in boring mortgage lending as it was less exposed to the exuberance of high finance. The Co-operative stores fill a crucial gap between our corner shops and the massive supermarkets. Community-owned energy schemes are quietly whirring way across the country.
Yet much of this social economy may be about to fall apart, as our wider economic model collapses. How do we protect what we have and build on it? If we can see a hopeful future, how do we hasten it? While we expect some kind of government action aimed at civil society this week, this is a wider, long-term endeavour, for all of us.
The £600m potential of Big Society Capital – and anyone they finance – should start to offer capital injections to almost any social enterprise that can use the money and is willing to take it on. These could be accounted for as contingent liabilities only for repayment to kick in if, for example, the FTSE returns to January 2020 levels, providing the much-talked-about-but-rarely-seen, long-term patient capital. With other asset classes in freefall and with the Government offering billions in credit guarantees for all UK businesses anyway, the BSC-backed social investment model was built for another era. This may even be the best way to actually protect these investors’ resources in the long-term and frankly, the only way to avoid BSC being remembered as an expensive irrelevance. Not acting now would be unforgivable.
Ahead of the investors, grant-makers are already stepping up. They are offering greater flexibility, more patience and less bureaucracy. But they may have to go further. We could be just weeks or even days away from trusts and foundations looking at charities and community groups, ditching their established funding processes and saying simply, “if you can act now, you have good intentions and good governance, then that’s good enough for us.”
From Government, the social economy just needs access to everything already on offer to other businesses, large and small. Fair treatment and not forgotten. It may already be too late for the Chancellor to learn from Elizabeth Warren’s proposed business bail-out conditions of a minimum wage for workers, a ban on share buybacks, and no dividends or executive bonuses. But there may be more bail-outs to come.
Housing Associations, councils, universities and other anchor institutions can also step up. Relatively sheltered from the crisis, they must bend their remits, borrow at almost no cost, deploy all the resources they can muster, and help – not hinder – the kind of community-led initiatives emerging above.
Intermediaries and networks like Social Enterprise UK and our friends at Co-operatives UK, or local counterparts such as the Plymouth Social Enterprise Network or Bath Co-operative Alliance must provide spaces to share, practical support, resources, guides and peer support. We can share templates for start-ups, models and rules for communities and co-operation. We can help replicate what is working in one area. Above all, we must be responsive and help our members, whatever they need.
As individuals, while we may feel under greater pressure then even to panic buy, we can still do our bit to buy social. We can let unethical business die and help save the ones we love and which our communities hold dear.
We also need to be honest when we need to redirect our sights. The Donkey Sanctuary and Cats Protection League are probably not the priority right now. The Campaign for the Stonehenge Road Tunnel or re-opening the old Lido can probably wait a while. Some social enterprises, charities and co-operatives may have to admit defeat. Or just that their raison d’être is not quite au courant. Some will close. Some will need to sleep, while others rise up.
For a long time, it was easier to imagine the end of the world than the end of capitalism. Now, suddenly, the reverse seems possible. But while none of us can pretend we really know what’s going to happen, we can influence the future. There is an inspirational social enterprise cliché for every occasion. Mandela said that it always seems impossible until it is done. But we still need to do it.
Let us know your positive stories about how you’re supporting your communities through this crisis or if you’re in a position to support other social enterprises at this time – email firstname.lastname@example.org