News and views

Social enterprises had plenty of ideas about the different ways they could significantly increase their positive social impact during the first evidence session of the Social, Cooperative and Community Economy All-Party Parliamentary Group (APPG)’s inaugural inquiry into the government’s commitment to grow diverse business models this week. Co-op and social enterprise leaders also listed straightforward and low or no cost barriers that the government could remove.  Peter Bundey, CEO of GLL, which operates 254 of the UK’s leisure centres, explained how supporting social enterprises would help with the government’s economic growth ambitions. “A 10% increase in our company would get 100,000 people more active and create 1000 more jobs,” he said. In terms of productivity, this could help a lot with the £138bn lost to sick days, he added. Whilst acknowledging “commendable aspiration” around social value and procurement, Bundey said progress was being held back by “conservative legal restrictions on public service procurement” and asked that the guidance and legislation that surrounds public sector commissioning is clarified.  “We need clarification so that councils can be more agile, more innovative and more prescriptive about wanting civil society organisations rather than turning to lowest cost,” said Bundey.  Peter Westall, Chief Value Officer of the Midcounties Co-op (which runs travel and childcare services as well as the familiar local Co-op shops) told the inquiry “We could do more, but the biggest challenge we face is cost pressures.”   The inquiry heard that a more unified, strategic approach to supporting the social enterprise sector was needed, with greater support, legislative reform, better access to finance, and a greater understanding of the value social enterprises bring to the economy and society.  Legislation  With revenues of £850m, 650,000 members and 6000 employees, Mid Counties Co-op made a profit of £12.4m last year but faces an increased National Insurance bill of £9.3m following changes for employers introduced in April.  Westall thought the government could help by changing ‘one size fits all’ legislation that means Midcounties Co-op face similar business rates and taxes on plastic packaging for their shops as supermarkets that operate giant stores in retail parks. His view was echoed by Social Enterprise UK (SEUK) CEO Peter Holbrook, who asked the government to consider how tax could be used to incentivise good behaviour for businesses, particularly around business rates and corporation tax.   Grace Harrison, Organisational Development Lead at Kitty’s Launderette (pictured above), a coop and community hub in Liverpool, asked that community right to buy legislation be tightened up so social enterprises could find properties to operate from.   Harrison also introduced an idea she’d encountered in Italy, where legislation requires both public and private employers with more than 15 employees to hire a certain percentage of disabled people. Employers can also fulfil the quota by entering into agreements with social value organisations. “This has massively transformed the access to work opportunities for disadvantaged groups,” said Harrison.  Access to finance  Finding investment to grow remains an issue for social enterprises irrespective of size. Midcounties Co-op is one of the biggest UK childcare providers offering nearly 4000 places and Westall explained they’d like to expand this service but “as a co-op we are unable, as other business types are, to go to the city and raise funds. How do we get additional finance backing to enable us to do the things that we want to do?”. The government has established an advisory group to look at ways of mobilising social impact capital.   Jonathan Atkinson of Carbon Co-op also called for a bigger spectrum of finance options to be made available and described having limited options for using an overdraft from banks unable to assess their business risk as a social enterprise.  More grant-making startup funds were requested by Harrison, who cited a reduction in non-repayable early-stage funding sources.    Support  More awareness and practical support across the board was also requested – for local authority commissioners looking to contract social enterprises and for business support for social enterprises. Westall also suggested that more co-op development agencies were needed, but this was challenged by Baroness Glenys Thornton who thought something broader was needed who said “this isn't just about developing cooperatives, this is about developing social enterprises and social businesses writ large.”  Holbrook thought government officials should establish “a single vision for how cooperatives, mutuals, and social businesses can collectively recover our economy.” He suggested this might take the form of a Social Business Unit so that every government department could benefit from a level of expertise and knowledge about these diverse business models.  This was the first of four evidence sessions for the Inquiry. All the evidence presented will now be collated and incorporated into a report that will be delivered to government and other stakeholders later this year.  

Georgia Gould MP tells attendees at the Social Value Leaders’s Summit that she wants to give social value “more teeth, more strength, more clarity”.  Georgia Gould MP, the Cabinet Office minister responsible for public sector reform, has said the government intends to consult on further reforms to public procurement processes, as announced to Parliament in February.  Speaking at the Social Value Leaders’ Summit yesterday, Gould said she wanted to give social value ‘more teeth, more strength, more clarity’ and was keen to explore how to really capture the social value of social enterprises.   “If I’m back here in a year’s time, I want to see a real change in the way government and the public sector buys that is thinking about how we support, incubate and maximise spend with SMEs and social enterprises,” Gould said.   To build on progress thus far, the Government will consult on a range of measures to potentially take forward public procurement processes and drive economic growth, support small businesses, and better support innovation.   Declaring herself “a big believer in social enterprises” Gould was addressing a crowd of nearly 200 social entrepreneurs, commissioners and corporate social value leads gathered for the tenth Social Value Leaders’ Summit at the headquarters of professional services firm PwC in central London.   Gould shared that the potential for procurement as described in the government’s recent National Procurement Policy Statement had captured the imagination of her colleagues in the Cabinet Office. The statement sees public procurement as a key lever to achieving Government aims by sourcing goods and services that deliver value for money and social value.   The challenge that remained was to make sure that the people procuring goods and services really prized social value. “Too often procurement teams are isolated from policy objectives,” she said. “There is a culture change needed across the system and there’s a lot we’re doing to push this forward”.  Smaller contracts, more notice, efficient auditing  The minister was preceded by Gareth Rhys-Williams, Chair of National Highways, who lamented the various instruments available to measure social value and called for a joined-up approach to “avoid a chaos of measures and metrics”. This was important, he said, as a third of all tax money goes on public spending.   To try and create social value, Rhys-Williams explained that National Highways have worked on breaking project work up in order to offer contracts that are manageable for VCSEs to service. He also revealed that the organisation will set targets for VCSE expenditure for the first time from April next year.   The mismatch between what commissioners want and what VCSEs can provide was also touched upon by Karolina Medwecka-Piasecka, East Birmingham Programme Development Manager at Birmingham City Council, who called for better forward planning of significant projects so that VCSEs have time to plan and possibly collaborate. “If you know a big contract is coming it might take three years to build a consortium, so the notice of that contract needs to be very advanced,” she said.   The role of VCSE organisations in delivering a mission-led procurement system had earlier been debated by representatives from Kings College London, facilities management provider MITIE, social enterprise Groundwork and law firm Stone King.   Graham Duxbury, CEO of Groundwork pointed out that, although social value is now part of the procurement lexicon, it’s not always followed through into contract management, with the result that it was too easy for social value to slip down the agenda. Another view on this was offered by Sara Rial, Social Outcomes Lead at business consultancy Jacobs, who told the audience in the last session of the day that she had seen clients she was advising “make big commitments and deliver absolutely zero” in terms of social value.   Fellow panelist Chris Luck, CEO of employment charity Shaw Trust offered some context on the environment in which VCSEs were trying to win contracts, explaining that for most small VCSEs, there were only one or two people working on bids and that for many organisations, the cost of bidding is prohibitive.   Overall, the summit offered a wealth of thinking on the delivery of social value which a more developed procurement system has the power to unlock. We’re grateful to our partners Anthony Collins, Jacobs and PwC for supporting us to host an event which showcased a range of opinions and ideas to further advance a more impactful procurement environment. It feels like we’re at a real turning point for social value, and this is a key theme of our new position paper, which we’d like to share with you. It sets out that this moment is the start not the end of a journey towards mission-driven procurement and will help guide this work going forward.   Over the coming weeks we will also be working on a document bringing out the key learnings from the day.   View some pictures from the Social Value Leaders’ Summit 

The Chancellor is in an almost impossible position, faced with high government debt, low growth, unprecedented pressures on public services at home, and conflict and trade wars abroad. In response, Rachel Reeves’s spring statement announced cuts to the welfare budget, increases in defence, and reductions to overseas aid. For many, this will all feel pretty depressing. Yet real hope lies in every community across the country. As Neal Lawson of Compass puts it, “one critical area to boost is the alternative economy, of co-ops, social enterprises, employee-owned workplaces…  Not only can these organisations help kick start economic renewal, but they can do so in a way that is fairer and more democratic.” We welcome the Government recently committing £10m to community energy, and £20m to co-operative housing. But these relatively small drops won’t double the size of the co-operative and mutual sector, as Labour’s manifesto promises. You can’t grow diverse businesses by investing less with one hand than you are taking away with the other. National Insurance rises for public service providers - without either shareholders or customers to absorb the costs - are undermining viable, mission-led alternatives to the outrageous profiteering and negligence we see in the water industry, in children's care and beyond. Social enterprises, co-operatives and community business are delivering real prosperity that people can feel on their high streets, in their neighbourhoods, and in their pockets. This is where hope lies.

On the fifth anniversary of the first lockdown, academic research shows that social enterprises not only survived during the pandemic - they thrived. Professor Richard Hazenberg and Dr Claire Paterson-Young from the University of Northampton explain.  At the five-year anniversary of Boris Johnson’s lockdown announcement in March 2020, there remain many questions as to the impact of the pandemic on the country’s economy and society.  One area that we still know relatively little about is the impact that the pandemic had on social enterprises and their ability to serve their communities.   Social Enterprise UK research in 2021 found that social enterprises proved resilient, retaining staff and having lower closure rates than other forms of business. But our team at the University of Northampton’s Institute for Social Innovation and Impact (ISII) has now found that social enterprises performed even better than previously thought.  With our new research, we found that not only were social enterprises resilient, but they also grew their turnover and increased staff numbers. Despite the challenges of operating during a pandemic, they also increased the number of people they were helping.   We looked at the financial performance and social impact of 1,507 social enterprises both before and during the height of the pandemic, covering the years 2019-2022.  It used data from the Social Enterprise Support Fund (SESF), delivered by Big Issue Invest and partner organisations, through funding secured from the National Lottery Community Fund.   Misson makes for resilience   Our analysis revealed that in the three years between 2019 and 2022, social enterprises in the sample increased their turnover by 28% and their profits by 89%. As social enterprises, those profits were largely reinvested into their social missions, supporting the groups and communities hit hardest by the pandemic. Not only did the financial statements make for good reading, but staffing levels and the number of beneficiaries supported both rose by 11%.   Moreover, these figures did not come at the expense of trading income. Whilst there was an increase in grant funding, overall proportions of trading income barely changed (-0.7%), illustrating that increases in turnover was balanced between both income streams (grant funding accounted for just over one-third of turnover increases).   How did the sector achieve this during a time of such immense challenge? It should perhaps not come as a surprise, as previous studies during earlier crises (such as the 2008 financial crash), have shown that the nonprofit sector tends to be resilient.   As part of our research, we held interviews with 17 social entrepreneurs and 16 stakeholders from the wider social enterprise ecosystem. These revealed that, for social enterprises, their inherent hybrid focus on both financial and social missions aided their reactions to the pandemic.   Indeed, it was their social focus, commitment to their communities, and ethical approach, which alongside their ability to problem solve and reshape their offers, allowed them to continue to deliver support. Community support offered by social enterprises was significant in reducing isolation, including the delivery of support to enable people to access technology, expansion of counselling for children, and online educational provisions.  It was therefore the multi-mission focus that lies at the heart of social enterprise approaches that supported this resilience.  Lessons to learn from   What does this mean for the social enterprise sector and those seeking to support it? Our sample is not illustrative of the social enterprise sector as it did not contain many micro social enterprises. The data also only runs through to 2022, so doesn’t determine how the organisations developed through the remainder of the pandemic and beyond.   However, the data does show that focusing on both financial sustainability and benefiting communities can prove an asset for organisations, at least when reacting to crises. Supporting more businesses to improve the integration of social mission at strategic levels and critically assess their community operations can support not only their resilience and sustainability but deliver wider economic and social benefit.    Perhaps most importantly, the data shows that social enterprise proved resilient and focused on delivering for their communities, despite the many challenges faced. As the UK faces ongoing challenges in public services delivery, spending cuts, and social tensions, support to allow social enterprises to expand further is vital, not least as a protection measure against the next big crisis.  The full, open access paper with the complete findings of the research, can be found here.  This article is part of SEUK’s Social Enterprise Knowledge Centre University Network – to find out more please contact research@socialenterprise.org.uk

Social enterprises present a great opportunity to improve life in the UK. Now a group of MPs will collaborate to help realise their potential. Patrick Hurley, MP for Southport, explains why he wanted to chair the group.  In my constituency of Southport and the wider area there are many social enterprises, cooperatives and community businesses delivering vital public services, community cohesion, innovating products and services and generating employment and inclusion. Businesses like these are powerful as they offer real value for people and planet and many do so at scale. They offer a fast-track solution to improving life in the UK for millions. Yet they still represent just 5% of UK businesses.  There have been numerous false dawns for social enterprises over the past twenty years. So much so, that any new attempt to create a buzz around the concept is likely to be greeted with a raised eyebrow and a knowing smile. Much more pragmatic, then, to accept that the path to a social economy is a gradual one, a path that accepts the reality of a mix of business structures, a path that is not paved with gold, but which is covered with a thicket of brambles needing to be cleared.  Late last year, as a relatively new MP, I was elected to be the new Chair of the All-Party Parliamentary Group (APPG) for our sector - a group we chose to call the Social, Cooperative and Community Economy APPG - and have since been working to develop a programme of work and an approach to growing the capacity and potential of the sector in the current economic and political landscape. Working closely with others in both the Commons and the Lords over the last couple of months on our plans, we’re now keen to make tracks on our agreed priorities for the year.  The business and governmental context that the social economy sector works in has changed fundamentally over the past couple of decades; indeed, it has changed fundamentally more than once. The availability of finance on a patient basis, the ability to trade while fulfilling community interest requirements, the need to step into the gap left by retreating public services - all these factors and more have evolved, and impacted the way social economy organisations go about their business. The time is therefore right to see if the regulatory systems, the legislative environment, and the funding landscape are what the sector needs for the next 10-15 years.  The UK is home to a robust ecosystem of support networks that encourage innovation within the social enterprise sector. From accelerators to mentorship programmes and collaborative hubs, these resources help early-stage social entrepreneurs navigate the complexities of scaling their impact while staying true to their core values. By fostering a collaborative environment, the UK has become a hotbed for social innovation, leading the way for other nations to follow suit. But there is always more we can do, and the APPG committee is determined to help grow the sector in a way that hasn’t been possible in recent years.   As we look ahead, it is clear that the future of business in the UK should increasingly be shaped by social enterprises. As the government makes decisions on public service delivery and as local government begins to rebuild after a prolonged period of austerity, it’s an opportune time for the sector to step up once again to help shape the future of the UK’s business landscape and tilt it in a more social direction. 

What is it, who’s in it and what will they do? Everything you need to know is here. What is the APPG? The Social, Cooperative and Community Economy All-Party Parliamentary Group (APPG) has been created to increase understanding and support of diverse, mission-led business models (social enterprises, co-ops, mutuals, employee-owned and community business etc). As the name suggests, it will work to address issues important to building a more inclusive economy and try to influence legislative change so that diverse mission-led businesses can reach their potential. APPGs are informal cross-party groups that have no official status within Parliament. They are run by and for Members of the Commons and Lords, though many choose to involve individuals and organisations from outside Parliament in their administration and activities.  Social Enterprise UK provides the Secretariat for the APPG. We assist the chair and officers of the group with APPG administration including meetings and AGMs, develop and deliver work plans, and manage communications for members and stakeholders. Who’s in it? Chair of the group is Patrick Hurley, the first Labour MP for Southport. Patrick previously worked as a councillor for Liverpool City Council for 12 years and ran the city’s Social Enterprise Network. Vice-Chair Baroness Thornton, one of the founders of Social Enterprise UK, is a long-standing social enterprise and cooperative expert who worked in the Department of Health and Social Care when Gordon Brown was PM and now sits in the House of Lords. The group also has two officers - Josh Babarinde, Liberal Democrat MP for Eastbourne, who formerly ran the social enterprise Cracked It, and Conservative The Lord Balfe, a former Political Secretary of the Woolwich Arsenal Co-operative Society who served in the European Parliament. A growing number of parliamentarians have joined and expressed interest in the group and wish to be kept informed of its progress. You can find a full list here. What will they do? In addition to arranging visits for APPG members to meet social enterprises, coops and community businesses, the group will run two inquiries over the coming months. The first will look at how Labour’s manifesto commitment to grow diverse business models, such as social enterprises and coops, is being delivered, exploring past and planned government activity and the wider context for growth in terms of capitalisation, routes to market and ecosystem support. A second inquiry will explore public services provision and the role for social, cooperative and community business within it. The APPG will also host a Parliamentary reception in June, as part of work to raise awareness in Westminster of the work and contributions of social, cooperative and community business. If you’d like more information, please email appg@socialenterprise.org.uk

Supplying services to the government or intending to? Here’s everything you need to know about the government’s new Procurement Act and how it will affect you.  Many of our members supply goods and services to local and national government, which is why the Procurement Act 2023 finally coming into force on 24 February is big news for social enterprises. The government is telling us that “the rules that shape how public bodies buy goods and services will change,” so if you’re a supplier or aspire to be, read on. We’ll tell you what’s changing, what you can do to prepare for it and why this is good news.  What is the new Procurement Act? According to the government, the new Act will simplify bidding and negotiating for contracts with the public sector by introducing a more flexible process that will reduce bureaucratic barriers for social enterprises. Payment will be more prompt, with 30-day payment terms on more contracts being promised, and suppliers can also expect feedback on their tenders from public bodies.   Key to this slicker way of working will be a new central digital platform, which is being positioned as ‘an enhancement to the existing Find a Tender service’. Registration will be simpler, and you’ll be able to store your core business details, making it easier to share your information with contracting authorities and use it for multiple bids. If you’re interested to see the new platform, the section below tells you how. All public procurement opportunities will be visible and searchable, and you’ll also be able to set up alerts, making it easier to stay aware of relevant available tenders.   The Act also promises a new regulator to ensure everyone plays by the new rules. The slightly Orwellian sounding Procurement Review Unit (PRU) will ‘enhance public sector procurement practice by ensuring adherence to the Procurement Act and safeguarding public procurement from suppliers deemed to pose risk’. Should you feel you were treated unfairly through the procurement process, the PRU will be the people to speak to, including anything to do with late payment.   How to get ready for the changes The government has done a good job in providing lots of resources to help you prepare for this new procurement process. It’s put a wealth of written information at your disposal, but also a library of 'Knowledge Drop' videos, as well as the training materials they are supplying to public sector buyers. You can find links to all of these on the government website. If you can set aside an hour, this video gives an overview of the new Procurement Act, along with key benefits and a demonstration of the new central digital platform. Join one of our practical webinars  We’ll be hosting a series of webinars to support organisations make the most of the opportunities being created by the new procurement landscape. 13 March, 12-12:40pm – Support for social enterprises Join our Deputy CEO, Charlie Wigglesworth, who’ll run through the key requirements for social enterprise suppliers. This webinar will be taking place in our Members’ Area and SEUK members will be sent a sign-up link in advance. If you’re not a member but would like to find out more, please fill out this expression of interest form. 12 March, 11am-12pm – Support for government suppliers VCSE Crown Representative, Claire Dove will run through the governments plans to increase spend with social enterprises and charities, providing practical examples and advice. 11 March, 12-1pm – Support for local authorities This webinar, explicitly tailored to local authority commissioners, will outline why it is important to involve social enterprises in the commissioning process. Why is this an opportunity for social enterprises?  The government has prefaced the Act going live with a National Procurement Policy Statement (NPPS) which provides transparency to the expectations they have of commissioners.   In it, it’s particularly pleasing to see recognition that social enterprises “are more likely to generate diverse and thriving local economies, creating jobs and economic growth”. Even better, that the number one requirement for economic growth in the NPPS is to “maximise procurement spend with small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs)”.  Read our full response to the NPPS. Overall, we see the new Procurement Act and accompanying statement as a good direction of travel towards our aim of all public sector procurement creating social value. If you’re interested in knowing more about this, you can read about our Social Value 2032 Programme.

Social Enterprise UK welcomes the publication of the government’s National Procurement Policy Statement (NPPS), which recognises the power of public procurement, and how social enterprises “are more likely to generate diverse and thriving local economies, creating jobs and economic growth".  The new Procurement Act, launching on 24 February, will mean the biggest change to public procurement in a generation. It is particularly pleasing to see the NPPS recognise the value of voluntary, community and social enterprises (VCSEs). The number one requirement for economic growth in the NPPS is to "maximise procurement spend with small and medium-sized enterprises (SMEs) and VCSEs".   As the national voice for social enterprise, we have long been building the evidence and making the case for procuring goods and services from businesses with a social and environmental purpose. The Future Economy Alliance, led by us, called for public sector procurement to give greater consideration to purpose, use of profits, paying taxes and employment practices. The NPPS does just that.  We also welcome the government’s commitment to mandatory targets for spending with voluntary, community and social enterprises from April 2026, something we've long called for.   However, we note that this applies to direct spending only. Given that nearly 50% of government spending with SMEs is indirect, we hope the government will consider applying these targets to all procurement (direct and indirect) in future. From our work on the Buy Social Corporate Challenge, we know that there is a genuine appetite from large business to work with VCSEs in their supply chains.  We would like to thank Claire Dove CBE DL for her work as VCSE Crown Representative driving public procurement to create social value, and to Georgia Gould and the Cabinet Office team for their leadership.   Our organisation has worked with 12 central government departments in the past three years to benchmark their VCSE spending. We look forward to supporting more departments and agencies in the future to achieve fairer and more sustainable use of taxpayers’ money that delivers the greatest economic and social value.