While the state has a responsibility to fund public services, that doesn’t necessarily mean it should be delivering them. Jihee Junn reports on Social Enterprise UK CEO Peter Holbrook’s talk at the University of Auckland to find out what we can learn from David Cameron’s controversial 2010 project.
Three years ago, the government announced its first ever round of financial support for social enterprise in New Zealand, awarding $1.27 million of funding to the Hikurangi (now Ākina) Foundation. But compared to other Western nations like Canada, the UK, Australia and the United States, New Zealand’s social enterprise sector remains well behind the curve.
So, as with most things, it pays for New Zealand to look and learn from overseas, particularly if our next government (whoever that might be) has any plans to get involved.
As one of the earliest adopters of social enterprise in the world, the British government’s commitment to the sector has certainly started to pay off in both a financial and societal sense. In the UK, there are now more than 70,000 social enterprises contributing more than £24 billion to the British economy, and according to Social Enterprise UK’s latest survey on the future of business, almost 30% of social enterprises base themselves in the country’s most deprived communities while more than 40% are led by female entrepreneurs.
Along with a grassroots mood for change among communities and small businesses, this remarkable progress has been catalysed by those at the top of the political ladder who began to see the benefits of the movement early on. From Tony Blair’s Labour government during the early 2000s through to Theresa May’s Conservative government today, the language of social enterprise has become increasingly prominent throughout the decades. Even Queen Elizabeth II, back in 2010, stated in her annual speech that “the role of social enterprises, charities, and co-operatives in our public services will be enhanced”.
For someone like Social Enterprise UK CEO Peter Holbrook, working in tandem with the government is a key part of his role, describing himself as the “principal lobbyist of social enterprise in the UK” and whose job involves building “the support and interest of all our politicians”. Holbrook, who’s visiting New Zealand for the Social Enterprise World Forum in Christchurch this week, describes social enterprise as a movement that’s based neither on the left or right of politics, but rather a “third way” which proposes an alternative method of “democratising the economy and delivering public services”.
While such an approach seems harmless enough, some have viewed the state’s increasingly wholehearted embrace of social enterprise with a more critical eye. In the UK, this came to head in 2010 when Conservative Prime Minister David Cameron launched the Big Society: his grandiose plan to help people feel “both free and powerful enough to help themselves and their own communities”.
“It’s about people setting up great new schools. Businesses helping people get trained for work. Charities working to rehabilitate offenders. It’s about liberation — the biggest, most dramatic redistribution of power from elites in Whitehall to the man and woman on the street,” said Cameron.
While noble in principle, detractors were quick to pounce on the bold and ambitious plan. Many questioned the ‘true’ political motivations of the state, particularly as the policy coincided with large-scale cuts in public spending. Former Labour leader Ed Miliband, for example, accused the Conservatives of “cynically attempting to dignify its cuts agenda by dressing up the withdrawal of support with the language of reinvigorating civic society”, going on to suggest that Big Society was simply “a cloak for the small state”.
In the media, publications like the New Statesman and the Guardian also voiced their concerns, while thinktanks like the New Economics Foundation wrote while “there are strong, sensible ideas at the heart of the ‘Big Society’ vision… for all its potential, [it] raises a lot of questions, which become more urgent and worrying in the light of public spending cuts”.
“I think the criticism of Big Society was right, and the main criticism was that it was about philanthropy and volunteering, and about a government shirking away from its responsibilities,” Holbrook says during his talk at the University of Auckland last week.
“I never supported that. I could never support that. But I do believe that public services can be more efficiently delivered with better outcomes that treat people as human beings.”
Holbrook goes on to explain how Big Society wasn’t necessarily an agenda around changing business fit for the 21st century, but a way to cope with the growing demands on public services that would avoid the inclusion of profit-seeking private companies.
“Private companies that had a primary purpose around shareholder gain were not delivering the quality of services that people required in human-based public services where relationships were the primary concern, not profit. It was also a recognition that the state isn’t always best placed to deliver some of these services.”
“If you look at the UK, children’s residential care when delivered by the state has horrific outcomes. You’re eight times more likely to go to prison if you’re raised by the state than if you’re raised within a family, so the state doesn’t always get it right either,” he says.
“What I believe is that the state has a responsibility for services, but responsibility doesn’t mean it has to deliver them. I think it’s about empowering experts by experience. For instance, allowing people with disabilities to design and deliver their own services, but making sure that the government doesn’t relinquish its responsibility to fund those services. It’s about a different relationship between state and public services. It’s not about the government saying: ‘Not our problem!’”
With the New Zealand government’s relationship with social enterprise still in its teething phase, it pays for those in power to recognise what works and what doesn’t when it comes to dealing with this relatively new phenomenon. Theresa May certainly has, learning from her predecessor’s mistakes to launch her ‘shared society’ vision earlier this year. But with Brexit talks still dominating May’s agenda, its true nature remains unclear.
“Theresa May has continued with the theme, talking about the ‘shared society’ … [which] is like the ‘big society’, but also sees a role for the government,” explains Holbrook. “Voluntary organisations, charities and philanthropy can never meet the needs of our societies. We need governments to be a partner.”
The Spinoff’s business content is brought to you by our friends at Kiwibank. Kiwibank backs small to medium businesses, social enterprises and Kiwis who innovate to make good things happen.
The Spinoff Daily gets you all the day's best reading in one handy package, fresh to your inbox Monday-Friday at 5pm.