Not that I’m averse to social enterprises, in fact let me state up front that I think it’s a large part of the solution to the current public service funding crisis (yes, crisis). But I saw this article (via @SpencerLWilson*) and it’s fair to say it raises a few concerns about the idea of public services being spun-off into social enterprises.
The idea that turning a public service into a social enterprise is ‘effectively privatisation’ is something that hadn’t really occurred to me before, but I suppose it is in the sense that it’s opening public services up to market forces. Then again there are no shareholders to skew the interests of the enterprise so it’s not what I would consider to be privatisation in its fullest sense (economists please correct me if you’re so inclined).
In my Happy Place I like to think of public service social enterprises as small entities owned and run by former local authority staff in blissful partnership with service users, commissioned by a local authority but also at liberty to generate income from other sources and provide services in a more efficient and innovative way. Aaaah, that sounds nice, right?
I think I’ve been forgetting a few things:
- A lot of local authority staff don’t like change
- There are a lot of control freak managers in the public sector
- Many of the good managers lack the essential skills of running a business
- Not all service users have wildly imaginative ways of redesigning services up their collective sleeve
- Managers and service users aren’t used to working in partnership
- Some social enterprises require an initial cash injection to establish themselves, particularly if they are providing a service that needs infrastructure
- People are relying on those services and if the social enterprise has teething problems or ultimately fails then those people don’t get the care they need
- Trade unions don’t understand the agenda enough to support it
That’s a whole bunch of risk and mitigating each risk will take time and consideration, something lacking in the public sector at the moment due to the impending doom of the spending review and the likely need to make massive cuts on the shortest of timescales.
A proliferation of social enterprises can definitely save money in the long term (this is not based on anything other than a hunch, by the way) and will surely lead to more innovation and the freedom to think creatively but I’m worried it’s being seen as a quick fix. Instead I’d like to see councils incubating social enterprises, bringing in mentors and people who know business to help managers adapt, bringing in service users to run the show, developing them and council staff over a couple of years, nurturing the enterprise and then setting it free into the market with a solid foundation and some great people. Uh oh, I’ve drifted back to my Happy Place.
Based on the article it seems like there’s a chasm between the public’s understanding of the benefits of spinning off their services into social enterprises (enterprae?) and the thinking being done by chief execs and local strategic partnership boards. How to bridge this chasm is something I’m still working on…
*In the interests of full disclosure I’m doing some FutureGov work with Kirklees and let me just say if anyone can make this work it’s probably them. And I’m not just saying that :)