Tag Archives: Social Enterprise London

No future

“But why don’t those social enterprises take young people on anyway if they have genuine jobs to offer? The answer is economic. Social enterprises still struggle to attract mainstream investment so they are often undercapitalised and their restricted growth means that taking on skilled staff is a process undertaken carefully, and long-term unemployed young people with limited skills pose too great a risk.” 

Social Enterprise London(SEL)’s chief executive, Allison Ogden-Newton, explaining the impact of the premature demise of the Future Jobs Fund (FJF), an apparently successful but relatively expensive New Labour initiative to tackle youth unemployment. Under FJF, employers received funding from the Department of Work and Pensions (DWP) to pay young people aged under 24 at least the minimum wage for 25 hours a week for 6 months.

SEL’s Future 500 scheme enabled 164 social enterprises, including Social Spider, to employ young people through the scheme. As government funding schemes go, there was a phenomenally low level of bureaucracy involved, leaving social enterprises to focus on the challenge of offering unemployed young people what – for many – was their first experience of paid employment.

FJF was scrapped in June 2010 as the new coalition government offered an early declaration of its intent to make major cuts in public spending. Since then, youth unemployment has been rising and, in January this year, economist David Blanchflower noted that the number of unemployed 18-24 year olds reached 951,000, the highest number since comparable figures were first available in 1992.

As mentioned here, I don’t think it’s useful to claim that there’s a direct causal link between youth unemployment and the recent bouts of civil unrest in our city centres. Where there is a direct causal is between the current difficulties faced by young people looking for work and what Blachflower describes as ‘the danger these youngsters will become a lost generation’.

Blanchflower explains some of the reasons why young people are doing disproportionately badly in the current grim economic circumstances: “First, because firms operate last-in, first-out rules. Second, and more important in this recession, firms have cut hours and shifts and stopped hiring, including in the public sector, which of course hits the young hardest. It isn’t their fault.”

It’s difficult to blame employers for doing their best to continue to employ people they employ already when times are hard. The problem is that this makes an already difficult situation even more difficult for young people leaving school, college or university and trying to find their first job. The likely result is, as Blanchflower speculates, that (a substantial chunk of) a generation young people will miss out an early experience of the world of work meaning that, while most of them will work at some point, they may never catch up in terms of wages and career prospects. This is especially unfair given that they’re even less responsible than most of us for screwing up the economy in the first place.

Politicians of all parties have always been happy to rock up at an inner city community centre to bemoan a creeping moral decline linked to a pervading culture of worklessness, while happily explaining how whichever project they happen to visiting is doing such a great job of changing this dismal outlook in the local area. The fact that this rhetoric continued through years of relatively high employment may have partly served to mask the present horror. Either way, things are now officially really bad and many local projects are beyond political visiting.

Last year, Iain Duncan Smith, secretary of state at Department of Work & Pensions explained that is was ‘a sin’ for benefit claimants to fail to take up jobs. Unfortunately, there is not currently same the clarity from the government about its own responsibilities to young people looking for work.

Given what’s happened since, the abolition of the Future Jobs Fund is looking like an increasingly reckless step. So far, it doesn’t seem like any elements of the new Work Programme will offer similar low-bureaucracy, high impact methods of getting young people into work. Social enterprises are ready and waiting with the energy and ideas to help some of the nearly 1 million unemployed 18-24-year-olds break into the job market (as opposed to JD Sports). What we’re short of is cash.

While it seems unlikely that FJF will return in exactly the same form, something along similar lines – perhaps with the DWP paying a lower percentage of wage costs or focusing support on particular areas – seems increasingly vital.

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The sector’s not for burning

“And where the bloody hell are the leaders of the so-called ‘social enterprise movement’ whilst all the hard won gains made over many years are being wiped out on the ground? They appear naive and way, way out of their depth. Dare they publicly take on a government which still pays most of their bills?”

Anyone who was previously uncertain about former Fifteen boss and Social Enterprise Ambassador, Liam Black’s view on the current performance of social enterprise leaders will now have had that uncertainty conclusively removed.

Before reaching that storming conclusion, Black makes a number of points that I strongly agree with. The central one being that there’s a massive gap between Big Society rhetoric about supporting organisations that help communities to help themselves and policy decisions that see organisations who’ve got a strong track record of successfully doing that go to the wall.

And while Black’s comparison between the work of a practically useful social enterprise under threat in the current climate and the work of social sector innovators may lean towards caricature: “His is not a sexy enterprise, it is not digital, he doesn’t get invites to drink white wine at Nesta or Big Society Network love-ins with the social innovation intelligentsia.” he is right to identify a climate in which it’s become easier to find funding to have exciting but often fairly abstract ideas about how to deliver positive change in the future than to get hold of the resources to actually help people right now.

That’s not the fault of Nesta or the Big Society Network – supporting new ideas is what they’re there for – but the social impact of new ideas generated is going to be greatly reduced if, by the time they’re ready to be rolled out, there are no delivery organisations left with the capacity and support within local communities to be able to do that. Volunteers will not plug that gap, as Social Enterprise London‘s Allison Ogden-Newton – who I assume is not amongst those Black believes to believes to be ‘fiddling while Rome burns’ – has consistently been pointing out for months and months.

Where I disagree with Black’s analysis is in his criticism of leaders of the social enterprise movement. Regular readers will know that I have a long track record of criticism of social enterprise over optimism – both in a general sense and in relation to the current government’s agenda. Here’s what I thought of last June’s post-election backslapping session with the new administration. Here’s my thoughts, just over a month later, when considered observers ought to have had a fairly clear idea of what was likely to happen next.

But given the situation as it is now I’m not sure what exactly Black would like leaders of the social enterprise movement to do. It is undoubtedly true that existing successful social enterprises are not receiving the resources they need to continue to deliver their much needed work. It’s also true that, whatever the Big Society Bank ultimately does do, it won’t provide investment on the scale necessary to deliver the level of new activity that politicians expect – and it won’t do anything at all to replace lost revenue from delivering contracts that the public sector is no longer commissioning.

I’m not sure how these unpleasant truths would be significantly altered by social enterprise leaders either publicly denouncing the government and/or setting themselves on fire on the steps of the Cabinet Office. Most of us are in social enterprise partly because we recognize that once governments have been (legitimately) elected and political decisions have been taken (with honourable intentions), there’s still an awful lot up for grabs in terms of what actually happens – and whether people get a relatively good deal or a relatively crap deal.

The challenge is to present a positive case for social enterprise and socially enterprising activity, while also highlighting the practical examples of what’s being lost and the impact on people if these losses are not prevented. I think Social Enterprise Coalition chief executive, Peter Holbrook, was right in his recent interview with this blog when he said of the public sector mutualisation drive: “I think we need to remain slightly agnostic about whether the government’s agenda is good or bad but, what we need to do is if this agenda is going to be driven forwards, is to make absolutely sure that we are mitigating the risks and maximising the chances for success.

This is also the right approach in a wider sense. If social enterprise in the UK is going to survive and (hopefully) thrive in the UK we’ve all got a responsibility to spread and amplify both positive messages about what could happen and message of caution about what could be destroyed.

 

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Time to bring back nosuchthingas?

It’s all going wrong for the government’s flagship programme idea. First Liverpool quit as a ‘vanguard community’, then Lord Wei decided he didn’t have enough time to keep providing free advice on how people can do more stuff for free, then one of most respected people in the world of volunteering said that cuts were destroying the concept. And that’s only few indicative clippings from the collage of catastrophe that’s befallen the Big Society agenda over the last couple of weeks.

After all that, as Craig Dearden-Phillips explains, it was left to the Biggest politician of all to step up to the lectern and relaunch/regurgitate (delete according to political taste) the brand.

My social enterprise has no position on government policy agendas beyond an acceptance that once governments have been elected at national, regional and local levels its our duty to engage with their policies in a possibly critical but ultimately constructive way. I’ve been sceptical of the project now known as the Big Society Bank since its original appearance as New Labour’s Social Investment Wholesale Bank. The arrival of the Coalition government didn’t make the idea any worse than it was before.

The problem is that now both political opponents of Big Society and civil society/third sector (once again, delete according to political taste) leaders are seeing the (up to) £300 million available – mostly as loans – from the bank in the context of massive cuts in council budgets. £300 million adds up to less than the £322 million combined savings targets for Birmingham and Manchester this year. So, if the Big Society Bank spent all its money in Birmingham and Manchester (and didn’t ask for any of it back) that might pay for council service provision to remain more or less the same in Birmingham and Manchester (although NHS services would be still be cut and there would be nothing to spend anywhere else).

Whether or not we reckon the Big Society Bank is a good idea, it’s not an answer to the question of how on earth social enterprises and voluntary sector organisations can build the Big Society without any money. The apparent emphasis from some in government on volunteering is a red herring. Political enthusiasm for other people doing volunteering is a cross party affliction. Gordon Brown’s volume-based moral crusade in favour of youth volunteering – which partly involved redefining many leisure activities as ways of helping the community – was just as ridiculous as anything the Coalition government has offered on the subject.

Useful volunteering by people who actually want to do it is a very good thing but, as Social Enterprise London’s Allison Ogden Newton points out, it’s not the answer to the question of how social enterprises (and others) can deliver public services in challenging economic times. And, if you believe the clever research people, the best way for the government to stimulate volunteering is to help people to become better educated and richer.

The Big Society debate is not light on anger, frustration and misunderstanding but a couple of the more frustrating things about the current rhetorical bloodbath are:

(a) Big Society, in the right context, is a good idea that offers a lot to the social enterprise movement and our colleagues in the voluntary sector. That’s partly because the fact that a party previously regarded by many as primarily promoting the interests of individuals is now actively promoting the idea of groups of people getting together to do social good is a positive step. And partly because many of us share Big Society thinkers’ concerns about the sustainability of an ever-expanding, ever more expensive state that often lacks the flexibility to work with people to help them live the lives they want to live.

(b) Big Society could give social enterprise a bad name. It’s likely that few of the hundreds of thousands of public sector workers (and voluntary sector workers) around the country receiving their P45s with exhortations to form a social enterprise and/or build the Big Society ringing in their ears are going to respond with enthusiasm. Big Society (as a brand) is on the rocks because it’s been irretrievably dragged into the cuts debate. There’s a serious danger that social enterprise – as an idea in the public consciousness – could go down with it. Lots of people really like The Big Issue but they don’t like it as much as they like having a job.

Neither the general idea of a smaller, enabling state nor the parallel idea of having lots more sustainable businesses with primarily social aims suddenly become fundamentally worse ideas when the state suddenly stops spending money but they become much harder to deliver without lots of people ending up worse off in the process. The government is unlikely to abandon the Big Society entirely – not least because it’s not clear what they’d replace with – but the test of the success of this week’s relaunch, to be judged this time next year, will be whether or not they’re talking about it quite so often.

For social entrepreneurs, the challenge in the months ahead is to be clearer than ever about what we do and why we’re doing it because the days of cuddly semi-relevance are well and truly over. Whether we like it or not, we face a tougher ongoing fight to continue to exist, coupled with an even greater need to justify our existence.

 

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Strategic departures

Finally announced yesterday the news everyone – within the social enterprise lobby – had been waiting for, the guidelines for the OCS ‘transition’ strategic partner funding*.

For those organisations thinking that it might an idea to jump aboard the strategic partnership bandwagon as it slows to halt in 2014-2015, the news is not good and the operative questions are about how many of social enterprises representatives will be able to cling on. As reported previously, the current list of 40 partners is being slimmed down to 15 and the available cash for the coming year (2011 – 2012) is down from the previous £12.1 million to £7.5 million.

Logic would assume that these criteria:

1.  The programme is open to:

  • existing OCS Strategic Partners only, either individually or jointly with an(other) organisation(s) as part of a merger (under way) or formal collaboration.

2.  The new Strategic Partners must be:

  • national membership organisations that represent a clear constituency within the VCSE sector; and
  • capable of representing the sector on a broad range of national issues and activity.

mean that current strategic partners SSE/Unltd (who are not membership organisations) and SEL (who are not a national organisation) are not eligible for renewed funding – although this position may be clarified at later point, and it’s not yet entirely clear if organisations who don’t fit some criteria could be involved in partnerships.

In light of these developments, I’d point people in the direction of Andy Gibson’s thoughts on social enterprise and The Big Society – particularly his point (4) re: social enterprise and infrastructure. Now is certainly the time for social enterpreneurs to think about the kind of support they would like the government to fund while their are still a range of options available.

One leading social enterprise commentator based outside London recently told me that he’s lost interest in what he regards as ‘increasingly irrelevant’ London-based national lobby activity and questioned whether or not we need a national sector body to represent us at all. That’s an interesting question. I’d be keen to hear people’s views on that.

Equally interesting is the question of whether we need more of the practical support that Andy calls for in his post. My concern is that a lot of what Andy is suggesting is right but there’s a big danger that we could actually have considerably less of that practical help available to social entrepreneurs from April onwards.

I don’t have a clear enough understanding of what OCS want to do with their strategic partner pot to be clear about whether that the right source for that work to be funding but I do know that support from organisations such as SSE and SEL has been extremely important to me and my organisation. If the Big Society is going to work, practical support to the people and organisations who  are going to deliver it is surely a priority.

 

*I am a trustee of Urban Forum which is a current strategic partner. My views expressed here are personal views which do not reflect the views of Urban Forum’s trustees, staff or members. Urban Forum is not involved in delivering social enterprise support services.

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Supporters seeking support

Anyone who knows their Old Testament will know the story of Moses, who followed God’s orders to lead the Israelites out of slavery in Egypt, spent a very, very long time walking round and round in circles then, having got his people close to where they were going, finally caught a glimpse of the promised land.

It’s a hard time to be a leading figure in the social enterprise lobby. Having spent nearly ten years following New Labour’s commandments, particularly ‘Thou shalt never allow the facts to get in the way of a mutually beneficial political story’, the social enterprise movement is now approaching (what some regard as) the promised land of The Big Society. More diligent Bible students will worry about what might happen next.

It’s not that the coalition government specifically hates social enterprise support, it just doesn’t like the structures and funding streams that used to pay for it. It’s easy to knock regional development agencies or programmes to support the development of third sector infrastructure – they don’t perform many live-saving operations and have no direct role in emptying anyone’s bins – and it’s proved equally easy to cut them.

While some regional support agencies, such as Social Enterprise London, boast expertise that means their consultancy services are in high demand from councils and health service agencies looking to spin out services into new social enterprise structures, most face a future without any funding that will enable them to provide services to members, unless those members can pay for those services directly at close to market rates. Some in the sector may see this as being broadly a good thing but it’s definitely not great news for small social enterprises and early stage social entrepreneurs.

The picture looks even bleaker for national umbrella body, The Social Enterprise Coalition (SEC) – possibly because the activity it’s carried out most successfully since its inception is lobbying the government, and the new government may not see the need to foot a relatively hefty bill for an organisation to lobby it.

With tough times looming, the SEC leadership is clearly hoping to bolster the organisation’s claim to be representative of the sector.  They are currently advertising two jobs – immediate start preferred – that run between now and the end of April (this April). One involves overseeing Voice 2011 (the organisation’s flagship national conference, taking place in March), along with three other projects. The other involves recruiting 500 new members in the next three months. Given that SEC currently has less than 400 members in total, recruited over the course of nine years, this is a fairly ambitious target.

While my organisation are SEC members, I’ve always been, at best, a highly critical friend of their approach to many issues – particularly the Social Enterprise Mark. But we do need a social enterprise umbrella body and SEC is the one we’ve got. The months ahead are crucial ones in determining the kind of social enterprise lobby and support structures we’ll have in place as we face the challenges of actually delivering on some of the promises that the movement has spent the last decade making.

As social entrepreneurs we have to make the case for the support and representation we want, as well as making the case to the government has to at least provide some cash to fund it.

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Looking to the Future

Interesting pre-Christmas rumblings in parliament where MPs on the Work and Pensions Committee have published an initial report into the abruptly curtailed youth jobs creation scheme, the Future Jobs Fund (FJF). FJF involved the Department for Work and Pensions (DWP) funding 25-hour per week jobs for young people aged 18-24 (and some older people from specific groups). The jobs had to be ‘additional posts’ – not unreasonably meaning you couldn’t fire people and take on someone else to do the same job for free – that provided benefit to local communities.

The programme was obviously particularly useful for social enterprises. I’m not sure how things worked out for those based elsewhere in the country but, for us, Social Enterprise London’s Future 500 scheme was vitally important in making the FJF accessible to our social enterprise. I know because I tried to sign-up with the scheme which, in theory, was part-run by our local council. The joy of Future 500 was that it achieved what so many government-funding streams fail to do, it kept the paperwork to a manageable minimum so that social enterprises (including those with only a few members of staff) could access the money and get on with supporting the young people they were employing rather than getting buried in a mountain of forms.

The scheme worked for social enterprises partly because the Future 500 scheme included a well managed referral scheme – SEL parternered with Striding Out and Prevista to deliver this – and partly because getting to over-paid jobs for six months at no cost to your organisation is really useful. It’s very different to offering volunteering placements. Making successful use of volunteers within a mostly paid structure is usually extremely difficult to do and, even when it works, takes lots of management.

People who are being paid (even a fairly paltry wage) are more likely to turn up and more likely to do what they’re asked to do – partly because, as an employer, you don’t have to deal with moral uncertainty about the extent to which you can expect them to do those things.

So, did FJF work? If you don’t want to read the Work and Pensions committee report, I can tell you that the basic conclusion is that FJF was relatively expensive compared to other back to work provision but that social enterprises and other job providers thought it was really good. Given that I’ve just told you in 24 words what the report tells you in 48 pages plus appendices, and that I could have told you this based on my existing knowledge if the report hadn’t been written, you may or may not want to question whether collecting evidence for and publishing the report provides value for money.

That’s obviously a fairly silly comparison but it’s almost as silly as comparing FJF directly with back to work schemes that involve artificially simulating the experience of making a phone call or being repeatedly encouraged to have a more positive mental attitude. While these activities may have their place and may contribute to some people getting jobs quicker than they otherwise would have done, they’re definitely not directly useful to the local community.

It might be a monumental feat of holistic thinking, de-siloing or whatever else a civil servant might be told to call it but it’s worth considering the cumulative impact of programmes that have several different effects. So when a scheme like FJF simultaneously provides an employment opportunity for a young person and some extra capacity for a social enterprise, then it’s worth taking both into account. The committee report doesn’t ignore this dual function entirely but only 3 of the 48 pages are on benefits for employers and communities. This is not because the committee members are stupid, it’s because they’re the Work and Pensions Committee and their primary concern is scrutinizing whether the DWP is getting people off benefits and into work as cost effectively as possible.

It’s got to be possible that these times of austerity will finally be the catalyst for greater practical consideration of the effects of policies beyond departmental boundaries, based on the potential impacts on (The Big?) society as a whole.

A new FJF-style scheme could be a vehicle for simultaneously achieving the aims of several departments:

  • the DWP need to get people into work
  • the Department for Communities and Local Government (and others) attempts to build the Big Society
  • the Department for Culture, Media and Sport’s need to support arts activity (and broaden access to jobs in the media)
  • any spending department’s need to get some stuff done a bit cheaper – this is unequivocally not a call for any trained professionals to be replaced by unemployed young people on the minimum wage but, for example, their are many non-clinical functions in the NHS currently unnecessarily delivered by clinical staff.

As the report suggests, it’s too soon to judge the full impact of FJF, but what we know so far offers some good suggestions about what could usefully happen next.

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Supporting arguments

The often breathlessly optimistic world of social enterprise support has developed a gloomier outlook in recent weeks as the realities of impending cuts to public sector funding begin to hit next year’s budget forecasts.

To understand the impact of cuts of in regional social enterprise support structures, it’s important to have an understanding of the starting point. Support for social enterprise in London is relatively comprehensive and well established. Social Enterprise London (SEL), the regional umbrella body and support organisation for social enterprise in London, is roughly seven times the size of, for example, Social Enterprise Yorkshire and the Humber.

But when compared to general support structures for the voluntary sector as a whole, SEL’s capacity is fairly small. It has a smaller staff team than Hackney Council for Voluntary Services (HCVS)*, the umbrella body for voluntary sector organisations in the London Borough of Hackney, one of 32 London boroughs (most of which don’t have their own dedicated social enterprise support structures).

Anedoctally, my sense is that many social entrepreneurs around the country are lukewarm about the contribution made by regional support agencies but certainly in the case of London – I’m not well placed to comment on practical experiences elsewhere – those who don’t appreciate the role played by SEL and its equivalents may soon be in the position of not really knowing what they’ve got til it’s gone.

State-funded promoters of social enterprise do – quite understandably – have a tendency to overestimate the distinctions between social enterprise and other sectors of the economy. I’ve never accepted the (New Labour) view that social enterprise is a category of entities that are specifically not either straight businesses or voluntary sector organisations. A small percentage of social enterprises in the UK right now are straight businesses, the vast majority are voluntary sector organisations but there are major philosophy-based challenges for those voluntary-sector based social enterprises in accessing useful support from local voluntary sector umbrella bodies.

In his fantastic book, Your Chance to Change the World – The No-fibbing Guide to Social Entrepreneurship, Craig Dearden-Phillips, writes about two different types of voluntary sector group, ‘Strugglers Ltd’ and ‘Strivers Ltd’. Strugglers Ltd start from a sense of entitlement. They believe that due to the good work they do – or are trying to do – someone (usually the council) owes them a regular income and they angry when they (almost inevitably) don’t get the funding they feel they need. Strivers Ltd may be equally skint but their starting point is that it’s their job to sell the work they do to funders and direct customers to generate income they need to do social good. If they don’t get the funding they need from one source they go and find it somewhere else.

The problem for social entrepreneurs seeking support from local voluntary sector umbrella bodies is that much of the support on offer is tailored towards Strugglers Ltd rather than Strivers Ltd. In some cases, a socially entrepreneurial approach will be met with bafflement, in other cases it will provoke active hostility.

We had an experience last year that fell somewhere in between when our own local voluntary umbrella body refused to allow us to advertise some of our training services (for money) in their mail out because they believed the training would be ‘very expensive for our members’. This left me baffled for several reasons the main one being that I’m not sure why it’s the job of a voluntary sector support organisation to protect their members from the trauma of choosing between raising some funds to pay for stuff they want but can’t immediately afford or putting a flyer which is of no immediate use to them into the recycling bin. In their world, though, I imagine the right thing to do is wait until your work is heavily subsidised by the council so you can offer it for free.

The extent to which your local voluntary sector bodies are rooted in this kind of dependency culture will vary greatly according to where you’re based but even if you’re in one of the luckier areas, it’s useful to have somewhere to turn where people will be able to understand both what you’re trying to do and the way that you’re trying to do it. In London, SEL provides that outlet to a very high level at a relatively low cost. The currently tiny membership fee enables members to access (some) practical one to one advice on matters such as business development and finance, with signposting to sources of more in-depth advice. And SEL’s ongoing programme of events provide a mixture of networking opportunities and practical training in starting a social enterprise, tendering, sources of growth finance and getting Olympic contracts (amongst other things).

On top of that, over the last year SEL has been running Future 500, a scheme to enable London’s social enterprise to provide 500 job opportunities to unemployed 18-24 years funded through the government’s Future Jobs Fund (FJF). The creative, bureaucracy-lite way that SEL has administered this project has opened up the FJF to many social enterprises who would have been far too small to access the scheme through red-tape laden local council programmes. This kind of activity – delivering practical outcomes for social enterprises and young people based on the needs of both – is a clear example of what regional social enterprise support has the potential to do, and what other agencies are unlikely to do if regional social enterprise support is not there.

The government shouldn’t get bogged down worrying about whether it’s desirable to have more organisations that call themselves social enterprises but it can and should be encouraging a more socially entrepreneurial approach in all sectors of the economy. That doesn’t mean supporting ridiculous ideas like the direct replacement of grants with loans but it does mean providing encouragement and advice to organisations that want to seek a broad mix of funding for their work while constantly looking for new and better ways to work with the people they serve to tackle social problems. One way or another, that means funding specialist social enterprise support agencies.

*We are not based in Hackney, although we do some work there, and the training advert experience does not refer to HCVS.

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