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Archive for October, 2010

So the chair of the charity commission, Dame Suzi Leather reckons that up to £5bn of funding will disappear from the coffers of charities over the next few years as contracts are cancelled and grant funding from local authorities, particularly the funding that comes via ‘discretionary spending’ will all but disappear. We know she’s right (she almost always is).

Things appear grim in just about any sector you are in. The CBI appears confident about private sector growth in the coming years but we all know of private companies large and small that currently survive solely on the business that they do with the state nationally or locally. Will these companies survive as they are? Surely not.

But these long term prospects don’t have to be a given. Death is not the only option; there are opportunities here too.

It’s easy to be despondent and understandable that people are angry; after all if the country with the fourth largest economy in the world can’t manage to look after its most vulnerable citizens then what hope remains? While I appreciate the huge challenges ahead across all sectors, it won’t necessarily be total carnage. There will, no doubt, be some blood spilt and good organisations doing important work will be sadly lost but great organisations, entrepreneurial organisations with empowered, entrepreneurial staff may well be able to adapt to this brave new world and do rather well. Many charities and even social enterprises have swelled in size during times of big government spending. They have become dependent on massive state contracts (or a multitude of small local ones). Some have bred a culture of over-dependency and doing this, many have lost their freedom to challenge their paymasters. Some have even lost sight of their original vision and purpose. Rather than be part of an independent sector that is free to challenge, question, analyse and at times condemn, quite a number have become simply extensions of the state. Independent quasi quangos with questionable impact and, in a few cases, a confused and questionable purpose.

It’s the front line, the beneficiary-led and community-owned organisations that need to be protected and protected fast. The government’s £100M transition funding is all well and good but what we really need is an enterprise fund for small and medium-sized charities that can be supported to find their socially entrepreneurial inner-selves. They need support from their social enterprise peers to find new ways to generate income and profit while achieving their social and environmental purpose along the way. Social firms have become pretty damn independent precisely because the state was never smart enough to understand their true value; development trusts where possible have acquired assets that should enable some sustainability over these austere times; Co ops that frequently trade in consumer markets will surely survive the challenges as the Co-operative Group and the John Lewis partnership have shown through the recession.

Charities need to get enterprising and they need to be preparing right now. Whatever we think about the budget and the implications of devolution on civil society groups we now know that the writing is on the wall. There will be less money flowing in the traditional ways. We in the social enterprise movement need to strengthen our evidence of impact, look to still-buoyant markets for ethical goods and services, innovate, evolve and whatever else – not give up without a fight. If we do this we may find in a few years’ time that we have a more developed sector, a more independent and credible voice, delivering ever better quality with ever better ways of engaging and working with the people that rely on the services and goods we provide.

The future has not just to be enterprising. It has to be socially enterprising.

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We were not surprised by Francis Maude’s comments that Government funding should go directly to community organisations rather than social enterprise umbrella bodies (at a Conservative Party Conference fringe event organised by SEC and Demos on Sunday) because no-one expects to receive such funding for the same things they have always done when the landscape has altered so radically.

Any organisation that hasn’t been working hell-for-leather on its sustainability plan in recent months needs to take a look out of the window. Anyone who represents social enterprise needs to walk the walk. SEC is a social enterprise in its own right and has agreed major changes to its business model to ensure its sustainability. But our first objective remains to support and enable the social enterprise movement.

The social enterprise movement has never been in greater need of investment in its national infrastructure. The Big Society needs a much bigger social enterprise sector and upscaling this can only happen with the help of SEC and the other support bodies.

At the Conservative Party Conference we have seen huge enthusiasm for social enterprise from MPs, ministers and think tanks: a real thirst for the work we are doing to join up organisations across the UK and replicate some of the phenomenal results that social enterprises are already delivering.

A national infrastructure to support the growth of social enterprise is vital. Social enterprises need access to capital; public sector organisations need support to bring more social enterprise to the communities they serve. Small to medium-sized businesses – in and outside of the private sector – are going to get the economy moving and local enterprise partnerships need to know how social enterprise works, what it can deliver and how to support it.

In the wake of the economic crisis we cannot go back to business as usual. Social Enterprise can radically alter the landscape but the sector needs Government support to deliver on the promise. Luckily we have a Government that has signalled its support for the sector again and again.

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It was great to be in Manchester to see Ed Milliband elected as Labour leader. The optimistic tone of his speech was also refreshing. The social enterprise community has always held Ed in great regard, he was a really insightful and supportive Minister of the Third Sector. He totally understood social enterprise and founded the successful Social Enterprise Ambassadors scheme among his many supportive acts.

We are looking forward to seeing him use his new position to help social enterprise grow and meet its massive potential to help deliver the just, compassionate and inclusive society that he describes.

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