Last week I went to the launch of London Borough of Waltham Forest(LBWF)’s Thriving Voluntary and Community Sector Strategy. When they started work on it was alliteratively known as the Thriving Third Sector Strategy but during the process of putting it together, the Third Sector was abolished by the incoming Coalition government.
Broadly speaking, the Coalition government has also abolished social enterprise support as a continuous specialist service. Regional support organisations were mostly funded through Regional Development Agencies and they’ve been abolished.
That’s a shame because at the launch of LBWF’s strategy, everyone seemed to be talking about social enterprise: some people were already running one, others were thinking of setting one up. This clearly isn’t a co-incidence. The reason why more people are starting social enterprises and more people in the traditional voluntary sector are looking at socially enterprising approaches is more or less the same reason why social enterprise support has gone or is going. The money has run out. Not in a literal sense – NCVO’s Civil Society Almanac reveals voluntary sector income was £36.7 Billion in 2009-10, up from £34.6 Billion in 2008-09 – but in real terms, when income is adjusted for inflation to show what the money organisation’s have can actually buy, the sector’s income is now dropping.
This is particularly painful because it’s a drop that comes after a long period of significant, sustained growth – from £26.9 Billion in real terms in 2000-01 to £38 Billion in 2007-08. During that period, the New Labour government talked the talk in terms of voluntary sector organisations becoming more businesslike but – while there was a big increase in public sector contracts – there was still plenty of grants as well. And many local authorities were funding organisations through hybrid arrangements that were a bit like a contract and a bit like a grant. The main point was that there was lots of money.
Not all specialist social enterprise support provided during these times of plenty was especially good – some of it was people who didn’t know much about business telling people how to write business plans, without any clear notion of who or what they might be writing them for – but some of it was sensible and potentially useful. The problem was that the conditions weren’t right for large numbers of organisations to make real use of it. Why would someone looking to start a socially useful organisation want to try and run it as a sustainable trading business when there were so many opportunities to get grant-funding or block contracts that were effectively grants?
Now thousands of organisations are faced with the choice of either finding a sustainable business model or ceasing to exist but it’s not clear where they should turn for help. One option – particularly in London – is to get some assistance from one of the plethora of highly publicised corporate social enterprise support schemes that have been springing up over the last year.
For Deloitte, running their Social Innovation Pioneers scheme is ‘a huge skills development opportunity for our people’ and its probably also fairly helpful to the social enterprises involved but these schemes are, quite reasonably, about identifying potential market leaders in social innovation not about supporting small organisations with no ambitions beyond making life better for a group of people in their local area on an ongoing basis.
The support role for those organisations is primarily left either to local authorities or to local Councils for Voluntary Service (CVS), such as Voluntary Action Waltham Forest (where I’m a trustee). The problem is that often local authorities and CVSs don’t know very much about social enterprise themselves – beyond thinking it’s a really good idea (or, in some cases, thinking it’s a really bad idea).
It’s possible to over-emphasise the need for support services – many social entrepreneurs are pretty good at just getting on with it – but it’s also likely that there are thousands of people with socially enterprising ideas who just need the right bit of advice at the right time to reassure that it’s worth carry on (or to help them avoid doing something that will lose them lots of time and money). If regional social enterprise support agencies aren’t going to do that, who is?