Social enterprises should be given credit for the extra social benefits they provide when running public services
In an environment of looming spending cuts, efficiency savings are obviously a priority. Decision-makers have to demonstrate that they are providing core services at good value for money.
But it is easy to overlook the additional benefits and savings that a more diverse group of providers generally, and social enterprise providers specifically, can bring. Social enterprises are already competing against major private firms to provide public services. They are winning contracts on cost, providing high-quality services ranging from social care and rehabilitation programmes to waste collection and transport provision.
Over and above the ability to provide services at a good price, social enterprises offer additional social and (or) environmental benefits – a holistic approach that can help meet wider organisational targets.
Unfortunately, typical procurement specifications do not allow decision-makers to take this wider benefit and, ultimately, extra value into account.
My own business, Sunlight Development Trust in Gillingham, Kent, provides a range of services to the public sector.
In 2008, through an open commercial tender, Café Sunlight was awarded a five-year contract to provide catering services to Medway Council. However, when the council team was assessing our bid, it was impossible for them to give us credit for the additional benefits we were committed to provide.
Since then, we have already had significant success in meeting the targets in Local Area Agreements. Through a range of activities we have:
- qualified 25 young people not in education, employment or training, of whom 23 are now in permanent employment
- enabled the rehabilitation of 20 serving young offenders from Rochester Young Offenders Institute
- used spent food oil to power delivery vehicles and reduce our carbon footprint
- and provided healthier options for customers and council employees, positively affecting their health and wellbeing.
Surely there is something wrong if decision-makers cannot factor this extra benefit in as they make their choice. That is why, as chair of the Social Enterprise Ambassadors public sector task force, I have called for a simple change to credit the extra benefits social enterprises provide.
Suppliers bidding to provide services should be required to demonstrate their wider positive impact on the social and environmental aims of the procuring organisation. This change could improve the standard of public service provision across the board.
It’s as simple as that – specific measures of impact could be left for providers to define. At a local level, it could include measurement against Local Area Agreements, National Indicators and Comprehensive Area Agreements.
Social enterprises do not need and are not asking for special consideration. Despite the recession, they are twice as confident of future growth as typical small to medium enterprises, according to research from the Social Enterprise Coalition. Since the economic downturn began, 56% of businesses like mine have increased their turnover from the previous year.
By introducing this simple requirement in a procurement brief, and giving credit for performance against it, social enterprises, third sector providers and private sector companies can compete on a level playing field.
Of course, it is easier said than done to make this kind of change but there is support and advice available. People who make procurement and commissioning decisions should look at the task force website, which includes details of where to get further advice and case histories of social enterprises making an impact.
Peter Holbrook is chief executive of the Sunlight Development Trust and chair of the Social Enterprise Ambassadors’ public sector task force www.socialenterpriseambassadors.org.uk
