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Research reveals gaps between rhetoric and reality of Big Society plans

1 July 2010

ippr research cover The government’s Big Society plans envisage a key role for social enterprises in delivering public services and supporting community action. But a new report by the leading think tank ippr north, for North West Together We Can, the regional empowerment partnership, reveals that without support, community and social enterprise will not be able to rise to the challenge of the Big Society.

Growing the Big Society: Encouraging success in social and community enterprise in deprived communities warns that there is a significant gap between the expectations of the Big Society and the current capacity of the sector. It argues there are not sufficient numbers of ‘enterprise-ready’ organisations looking to contract with the public sector. Despite these concerns, the report highlights some examples of some of the best practice in the North West. For example, St Peter’s Partnership in Manchester has an annual turnover of £2 million, earned by its willingness to take risks and the talents of its committed team. But such examples are few and far between.

The research reveals many organisations claiming to be community or social enterprises currently rely on grants and public sector funding. In an online survey grant funding was shown to be the primary port of call for over 70 per cent of respondents in the last 12 months. The report argues that with such a strong preference for grants, there is a long way to travel before voluntary and community organisations can become fully fledged social enterprises. It is going to require significantly more intellectual and financial investment and coordination, particularly at the local level, if the Big Society is going to take off.

ippr north director Ed Cox said:

"Public sector contracts are a key route to sustainability for social and community enterprises but the drive for efficiencies means contracts are increasing in size. This makes it more difficult for social and community enterprises to win contracts as they’re often small and locally focused. f we’re not careful this drive for economies of scale will be at odds with the best intentions of the Big Society. Organisations need support to make the transition from being aspirant community organisations to fully fledged social enterprises. But the support on offer to them is complex, confusing and unhelpfully competitive."

The report recommends:

► urgent, robust and frequent dialogue between national policy-makers, regionally and locally-based representatives of the third sector, local authorities and other support agencies in order to address concerns about capacity and funding.

► money coming to the sector through the Big Society Bank, the Communities First Fund and any local authority discretionary spend should be targeted at the areas of greatest need. Investment should focus on securing sustainability and supporting start up organisations in areas where they are absent.

► Aspirant social enterprises should undergo an organisational review, focussing on core mission and future financial sustainability in order to facilitate a genuine transition to a more enterprising approach.

► Local authorities and other public service providers review their commissioning and procurement processes to ensure they are accessible to the social and community enterprise sector. This should then move quickly from developing strategies and planning to concrete action.

► Better co-ordination between the myriad of support agencies in the so that more coherent support can be offered to existing and aspiring community and social enterprises in the region. This should be based on a ‘life-cycle framework’.

More information on ippr north's website