Thursday, January 12, 2006

Enterprises for localism? 

It is a new term for many people – “The Social Economy’. What is it, and what does it mean for us? How does a Liberal approach relate to this, particularly our commitment to localism? Should we specifically look at this as part of the Meeting The Challenge exercise? What are LibDem councillors doing to explore the possibilities of such enterprises contributing to services in their areas? If I get the workshop I asked for, I hope to raise some of these points at the One Day Conference in London on 14 January.

In Britain we know about Charities, Co-Operatives and non-profit organisations. These are defined by some firm legal and practical structures. The idea of a 'Social Economy' concentrates less on how an organisation is structured and more on what its aims are.

Broadly, a Social Economy organisation or a Social Enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners. In short it

· Accepts the need to generate income from its activities to meet its costs and obligations.
· Has a wide range of criteria for success. Not just the financial ’bottom line’ but some agreed set of public goods.

A Social Economy organisation could be a Co-Op or a charity, but it could also be very like a commercial organisation in its structure. The difference (it is claimed) is the use of business methods to achieve public goods. It works (in theory?) under market disciplines to achieve its ends. To expand this sector a new legal form (the Community Interest Company) has been created for Britain. The law regulating this (the CAICE Act 2004) came into effect in July 2005. A Regulator has been appointed for this new sector. It is not possible for a CIC to be a Charity, something LibDem MPs tried to change when the legislation went through Parliament as we feared this would divide the Social Economy field.

There are a number of support organisations working in some specific areas (such as London Bristol Birmingham and Scotland). There are also a number of national support organisations to give help and advice to potential Social Enterprises. If you need some further information try these links.

Social Economy Network

Social Enterprise Coalition

Nearbuyou National Social Trading Network

Social Enterprise Partnership

School for Social Engineers

Social Enterprise Training and Support

The Guild (Training and Consultancy to Social Enterprise Sector)

Business Link Social Enterprise Knowledge Centre

Social Economy Bristol (example of a Local Support and Development organisation)

What do you think?

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