Category Archives: social enterprise

UN asked to help create a ‘level playing field’ for co-operatives

By David Bicknell

There is a growing call from the mutuals and co-operatives sector for the business environment to be made friendlier to enable them to thrive.

That message has now made it to the United Nations, where Dame Pauline Green, President of the International Co-operative Alliance, called for nations to take co-operatives much more seriously. 

As Co-Operative News reports, Dame Pauline said, “..member-owned co-operatives are a serious business model – with scale. And so, co-operatives are asking that the specific and unique legal and financial framework of a co-operative is fully acknowledged and recognised in public policy and regulation.”

“Co-operatives are asking that there should be a greater diversification of the global economy, to ensure a level playing field for the member-owned model of business.”

Dame Pauline said the sector’s “commitment to our democratic and social agenda is built on a sound and successful member-owned business model” that means operatives can compete successfully in the marketplace with other forms of business.

What Mutualism means for Labour

By David Bicknell

It’s interesting that when a word starts to be linked with a trend or movement, everyone wants to be associated with it.

That’s beginning to be the case with mutuals. Now the Labour Party has seen an opportunity to put its definition on what mutuals are, with the publication of a new pamphlet from the Policy Network, called ‘What mutualism means for Labour.’

The Policy Network blog says this:

“The Conservatives, with their rhetoric of the “big society”, seem to have displaced Labour as the “party of ideas”. Their emphasis on empowering communities and decentralising power arguably reflects a cooption of traditional social democratic language and an encroachment on the ideological terrain of the centre-left. Many see mutualism as the left’s answer to the “big society” and a key pillar in Labour’s political economy. However, our definition of mutualism remains unclear and the means to achieve its goals intangible.

“This pamphlet sets out to develop a clear vision of what mutualism means for Labour and how it can be used to drive forward the social democratic project. It brings together prominent thinkers, politicians and strategists to lay down ideas on how mutuals and co-operatives can serve as models of post-crisis reform in both the private and public sectors. ”

Comment

Given that there are employees who want to set up mutuals, a practical, how- to guide might have been more useful, both to the mutuals themselves as well as to Labour in defining its mutuals credentials. Instead, although this pamphlet has some good essays, it is undermined in places by the usual anti-Thatcher fare that’s great for the Labour Party Conference, but not much practical use to anyone else.

“It is Thatcherism disguised as mutualism – witness the recent case of the awarding of a large NHS contract to a private provider. (Virgin Healthcare) rather than an employee-owned enterprise (Central Surrey Health). David Cameron made much play of the work of Central Surrey Health and indeed praised it publicly as an ideal example of what the ‘big society’ stands for. Yet when it came to the crunch, the progressive mutual organisation was gazumped by the private provider, just as Margaret Thatcher would have loved all those years ago.”

There’s also a dig at No 10’s Director of Strategy, Steve Hilton – “We need to authoritatively restate our values of co-operation, solidarity and mutualism in order to expose the difference between our vision of society and our opponents’. The difference between an authentic tradition, built upon the secure foundations of a century’s worth of history, and a ‘tradition’ built upon an overlap in one of Downing Street strategist Steve Hilton’s Venn diagrams.”

Knockabout stuff, but Punch & Judy politics and of little practical help to today’s fledgling mutuals. 

Is this really what mutualism means for Labour?  On the face of it, not much then.

A few words from Francis Maude on mutuals’ pathfinders, skills and leadership

Some key points appear to emerge from this Civil Service Live interview with Cabinet Office minister Francis Maude, who continues to be a chearleader for mutuals.

* Don’t bank on another wave of mutual pathfinders. It seems as if there is an internal debate going on which is erring towards wider encouragement for mutualisation.

* Leadership in setting up mutuals is required – and it may come from outside in stimulating workforce interest.

* Maude is more interested in developing skills in-house rather than hiring external consultants

* Staff shouldn’t be excluded from the opportunity to benefit from the sale of any entity.

The case for partnership between mutuals and the private sector

By David Bicknell

I mentioned yesterday ongoing discussions over the role of the private sector in partnering with mutuals.

There is more grist to the mill here in this blog by Craig Dearden-Philips who argues that “the next year or two is crucial. Partnerships appear to be a sensible way to press on beyond the first wave of early adapters.”

Why the private sector is keen to be a Good Samaritan to new mutuals

By David Bicknell

There is a growing trickle of blogs, comments and discussions emerging around the idea of mutual joint ventures.

The mutuals concept has captured the imagination, even if precisely how they are going to be created; fund themselves; stand on their own two feet and compete in the commercial market has yet to evolve fully. And it will take some time.

Never one to pass up an opportunity, the private sector is now keen to offer itself as a Good Smaritan, lending a helping hand in helping mutuals get off the ground.

As a recent well-written paper from the Business Services Association puts it,  “…several barriers exist to realising the Government’s vision for mutuals. New mutuals spinning out of the public sector will face significant resource challenges – in terms of both expertise in areas such as human resources, finance and business planning, and start-up capital. Raising necessary capital will be a persistent problem for staff looking to form a mutual but lacking a trading history.

“A recent survey of British employee-owned companies found that one-third had difficulty accessing finance. Similarly, a number of studies have noted the “steep learning curve” faced by public sector employees when having to create a business plan, plot income generation for future years and develop marketing strategies – skills commonly required in the private sector. Partnering with a private sector provider through a mutual joint venture could offer a way of overcoming these barriers.”

Inevitably, there is a degree of self-interest here. As the Business Services Association guide  states, “there is a clear appetite amongst BSA members to enter joint venture agreements with, or as part of, new mutuals spinning out of the public sector.

“At the BSA-Pinsent Masons LLP 2011 annual lecture, Minister for the Cabinet Office, the Rt Hon Francis Maude said that the Government was open to hearing about new models from private providers partnering with mutuals to deliver public services. This put the ball firmly in the private sector’s court to consider how to rise to the Government’s challenge.”

It adds that the aim of the paper is therefore to be constructive, not to issue a list of requests for clarity or new demands of the Government, but rather how to work with the existing legislative landscape to make mutual joint ventures happen.

Nothing wrong with that idea. Joint ventures with the private sector may well turn out to be the way forward, provided the key words are mutual and joint. It is in no-one’s interests for a joint venture to be dressed up as a takeover.  As the title of the BSA’s document appositely puts it, it’s about “Making Mutuals Work.”

OPM: ‘three key ingredients for a mutual’

According to this blog from the Office for Public Management, there are three key ingredients that make up a mutual:

* Getting key people on board

* Taking a strategic approach to looking at different options

* Managing the process efficiently

How new models of ownership may help the health and social care sector

Maude: “We want services to be run by mutuals, social enterprises and small businesses”

By David Bicknell

Cabinet Office minister Francis Maude is to reinforce the message that the government wants its  services to be run and delivered by mutuals, social enterprises and small businesses.

Maude will tell a conference: “In the current climate we can no longer afford waste – demand for services is growing at a time of fiscal constraint.

“But we should not tolerate wasting public money whatever the economic climate. We need to find new ways of delivering public services that are high quality, cost effective and genuinely responsive to the needs of individuals, communities and businesses at local level.

“We believe that nearly all public services can be improved by being delivered by a wide range of organisations. What and how services are delivered are more important than who they are delivered by, and competition breeds innovation and creativity. These in turn will deliver service improvements.

“We want services to be run and delivered by mutuals, social enterprises and small businesses; and we want the talented people who are enthusiastic about what they do to be freed up to deliver services in the way that they think is best.”

Maude’s message comes as most public sector managers say they outsource work to save money, with few believing it leads to improved services.

A survey of 100 human resources directors from government departments, local authorities, NHS trusts and police forces revealed concerns that outsourcing services to private firms would lead to a loss of expertise in the public sector.

The research, by Totaljobs.com, found that almost two-thirds of managers believed outsourcing would cut costs, while only one in four said it would deliver better quality services.

The report will be discussed at the conference aimed at examining the implications on recruitment and skills of Government plans to achieve £40 billion of procurement savings in the next three years

Mike Booker of Totaljobs.com said: “The perception that the skills needed in the public and private sector are somehow different is being swept away by the more pressing need to work together to achieve £40 billion in savings.

“While we’re seeing large numbers of public sector workers looking to migrate to the private sector, it must not be forgotten that essential private sector skills are in high demand in the public sector with our site alone housing 326 postings for public sector procurement professionals.”

A webinar on legal, procurement and contractual issues around public sector staff mutuals

By David Bicknell

This Thursday, 20th October, Local Government Law.tv is hosting a webinar on procurement and contracts issues arising out of the government’s encouragement of  the formation of staff mutuals by public sector employees to take over the running of services from their employers.

The course will cover the following:

•    Outline Government policy towards transfer to mutuals
•    Explain the provisions of the Community Right to Challenge under the Localism Bill
•    Outline issues which may arise under Public Contract Regulations
•    Consider  the ability of such a body to discharge a statutory function
•    Look at possible contractual issues  to be considered
•    Examine potential Governance issues which may arise

Mutuals and the private sector: a public services marriage of convenience?

By David Bicknell

With much discussion about how public service mutuals and social enterprises can truly compete with the private sector, this article from the Guardian’s Public Leaders Network argues that perhaps the way forward is for spin-outs and the private sector  to work together in joint ventures.

It suggests that there are attractions in the partnership model, though there could also be problems as the public service ethos attempts to find a ‘mutual’ agenda with the commercial side.

Conference Season: The Guardian, FAST, Capita events

We’re very much into conference season with a number of up and coming events competing for attention. 

These include conferences on social enterprise organised by The Guardian on 8th November; on co-operation between IT and the business, collaboration and IT asset management organised by FAST at Twickenham on 21st November; and one by Capita on Public Service Mutuals on 7th December.

The Guardian’s one day event discusses how social enterprises are providing public sector services as well as the obstacles and practical solutions to the challenges the sector faces.” Speakers include Nick Hurd, minister for civil society at the Cabinet Office and Nick O’Donohue, chief executive of Big Society Capital.

FAST’s event, ‘Lessons from the Touchline’ has two streams: ‘finance and business’ and ‘technology and soft skills.’ Speakers include Olympic Gold Medal winner Ben Hunt-Davis, Kirstin Furber, HR Director for BBC Worldwide, Doug Clark, Head of Cloud Computing at IBM, Internet entrepreneur and Internet visionary Frank Joshi speaking on the importance of relationships and collaborative technology, and Chris Rawson, former CIO and Managing Director of Exvine.

Speakers  at the Capita event include Mutuals Taskforce chair Julian Le Grand; Carole Leslie, Director of Policy, Employee Ownership Association;  and Councillor Steve Reed, Leader, Lambeth Council.