a manifesto for social enterprise in scotland

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In Business to Change Lives A Manifesto for Social Enterprise in Scotland Championing business with a social purpose

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Page 1: A Manifesto For Social Enterprise In Scotland

In Business to Change LivesA Manifesto for Social Enterprise in Scotland

Championing business with a social purpose

Page 2: A Manifesto For Social Enterprise In Scotland

The Scottish Social Enterprise Coalition is the national collective voice for social enterprise. We represent a wide range of social enterprises as well as national intermediary and support networks. Working together with our members, we showcase the benefits of social enterprise and inform Scottish policy. This manifesto has been developed by the social enterprise community across Scotland. We would like to thank all those individuals and organisations who took so much care to feed into this process.

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IntroductionHow can Scotland create a prosperous, sustainable economy inspired by our national values of fairness and social justice? How can Scotland enhance and improve the quality of public services? The answer is social enterprise – businesses which are already transforming lives and communities across Scotland through reinvesting their profits for social and environmental purposes. From the earliest mutuals and co-ops, social enterprises were created in Scotland to address community needs. Today, our 3000+ social enterprises are pioneering new approaches to delivering quality public services, tackling climate change and regenerating communities. They create quality jobs and training for vulnerable people furthest from the labour market, as well as exciting career opportunities for young people and for individuals changing careers.

Social enterprises come in all shapes and sizes: from social firms, credit unions, and housing associations, to community and worker co-ops, development trusts and community interest companies. Social enterprises operate in rural and urban Scotland and across more than 30 commercial sectors. This is a dynamic and fast growing movement ready to deliver a radical new approach in our business and community life.

We call on all parties to work with us to ensure Scotland becomes a world market leader in social enterprise.

© 2010 Scottish Social Enterprise Coalition Thorn House, 5 Rose Street, Edinburgh EH2 2PRT. 0131 243 2650 E. [email protected]: www.contextdesigns.co.uk Photography: 2009 & 2010 bursary winners Rebecca Duncan (www.beckyduncanphotography.com) and Aly Wight (www.alywight.com). Cover image: Aly Wight – McSence Training Midlothian.

Page 3: A Manifesto For Social Enterprise In Scotland

Priority 1 – Enhancing Public Services through Social Enterprise We call on the future Scottish Government to recognise the added value social enterprises deliver in providing quality public services.

•���Designing�and�commissioning�of�services,�through Public Sector Partnerships•��Ensuring�that�Community Benefit Clauses become an unarguable norm in public sector procurement practice; achieving wider social outcomes in the procurement process offers�SMEs�and�social�enterprises�real�opportunities in the supply chain•��Identifying�solutions�to�the�barriers�presented�by�TUPE�arrangements�in�relation�to public sector pension fund deficits

Priority 2 – Building a Skilled Inclusive Workforce through Social EnterpriseWe call on the future Scottish Government to recognise and increase the contribution social enterprises make in creating quality jobs and skills training.

•��Scoping�our�contribution�to�inform�future�policy making•��Working�towards�greater�alignment�with�UK�Government programmes in skills training and job creation

Priority 3 – Creating Sustainable Communities through Social Enterprise We believe the promotion of community ownership through social enterprise delivery can underpin the economic and social cohesion of communities, delivering local skills and local jobs. We call on the future Scottish Government to:

•��Recognise�the�role�of�social�enterprise����������in regeneration •��Tackle�public�asset�transfer�delays�•��Restore�momentum�in�the�land�reform�agenda

Priority 4 – Achieving Green Communities through Social Enterprise Social enterprises have a crucial role working in community based renewable energy projects and reducing landfill through waste disposal and recycling. Profits are reinvested in communities to provide local amenities, local jobs and increased opportunity. We call on the future Scottish Government to:

•��Introduce�a�Community�Energy�����Investment�Strategy•��Allow�local�communities�to�generate����income through local waste•��Incentivise�community�ownership����������������of renewable energy developments

Priority 5 – Supporting Social Enterprise BusinessesWe call on the future Scottish Government to ensure:

•��Scotland’s�social�enterprises�have�access�to�quality tailored business support, with clear signposting for social enterprises whether start-ups or established•��Learning�about�social�enterprise�forms�part of school life and further and higher education

Priority 6 – Access to Capital for Scotland’s Social Enterprises To enable social enterprises to fulfil their potential requires imaginative financial solutions involving both public and private sectors. We call on the future Scottish Government to:

•��Engage�with�commercial�banks,�particularly�those in majority public ownership, to ensure that lending to social enterprises is both sustained and increased

•��Support�the�future�capacity�of�credit�unions�to lend to social enterprise •��Create�a�bespoke�loan�guarantee�scheme�for�social enterprise in Scotland •��Engage�with�the�UK�Treasury�to�ensure�Community Interest Tax Relief (CITR) is simplified and extended to encourage longer-term investment, and that other existing tax relief included in the Enterprise Investment Scheme�and�Venture�Capital�Trusts�are�amended along with the provision of clearer guidance for social investors•��Consider�the�principle�that�the�Scottish�Parliament should have powers to amend the basic rate of income tax for third sector workers to aid sustainable growth•��Introduce�investment�mechanisms�such�as�Social Impact Bonds which channel private investment into projects run by social enterprises and third sector organisations

Thank you for your support.

Social Enterprise in Scotland Enterprising Community Solutions

Actions for a National Culture of Social Entrepreneurship

Social enterprises can enable Scotland to protect public services and create a prosperous, sustainable economy inspired by our national values of fairness and social justice.

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Executive Summary

Page 4: A Manifesto For Social Enterprise In Scotland

Priority 1 – Enhancing Public Services through Social Enterprise

We believe that service design and the commissioning process should take account of how social enterprises operate, recognising the value of the role they play in regenerating communities and enriching the skills and lives of local people.

We call on the future Scottish Government to champion the added value social enterprises deliver in providing quality public services.

Rolling out Public Social Partnerships The public sector in Scotland spends £8bn on procurement each year. Social and environmental outcomes can be achieved alongside financial efficiency through rolling out Public Social Partnerships, in which

Third Sector organisations work with public sector purchasers to design public services. By reforming public service design to involve end users and providers, improved quality can be built round the needs of people and communities.

We call on the future Scottish Government to commit to a continuous programme of Public Social Partnerships to deliver a radical new approach to quality service design. Mainstream Community Benefit Clauses Community�Benefit�Clauses,�social�clauses�that can be included in public contracts, are of increasing interest to the public sector in Scotland.�Achieving�wider�social�outcomes�in�the�procurement�process�offers�SMEs�and�social enterprises real opportunities in the supply�chain.�Community�Benefit�Clauses�have already played an important role in achieving�the�principle�of�legacy�in�Glasgow’s�

2014�Commonwealth�Games.�Community�benefits can be incorporated into contracts to include: targeted recruitment and training (TR&T),�equal�opportunities,�training�existing workforces, supply chain initiatives and community consultation. We call on the future Scottish Government�to�ensure�Community�Benefit�Clauses�become�an�unarguable�norm�in�public sector procurement practice, through working with all public agencies and with effective monitoring of national data to ensure progress is being made.

Remove Barriers

Social enterprises and other businesses can experience barriers in public sector contract delivery,�with�regard�to�TUPE�arrangements�which encompass the liabilities of public sector pension fund deficits.

We call on the future Scottish Government to identify solutions to this growing challenge. We also ask for improved routine social enterprise data collection to raise awareness of the economic impact and reach of the sector, including the introduction of features to identify social enterprises in public sector procurement portals.

The Community Benefit Clause for the building of the Velodrome for the Commonwealth�Games�in�Glasgow�provided�an opportunity to submit a tender to operate an on-site catering facility serving 500 workers.��Unity�Enterprise�was�invited�to�set up the operation after a tender process exclusively involving social enterprises.

While the main building contractor assisted with setting up the accommodation, Unity Enterprise�had�to�make�a�considerable�investment in equipment and infrastructure. To date the operation has enabled Unity Enterprise�to�employ�10�people�who�were�not only unemployed but also to provide employment and training opportunities for some of our current service users.

The agreement is to last over the next few years until the site is completed and this experience�will�enable�Unity�Enterprise�to�tender for similar work in the future.

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Social Enterprise in ScotlandEnterprising Community Solutions

Delivering public services in the face of constrained public spending and rising expectations remains the biggest challenge for Scotland’s policymakers. However, we believe that social enterprises are part of the solution. They have a proven track record of providing quality, cost effective solutions to deep seated society problems, through innovative business practices and successfully unlocking hidden assets of local knowledge and resource normally overlooked in the conventional marketplace.

Community Benefit Clauses – Unity Enterprise, Glasgow

case study

“A charity dollar has one life, is used once, and then dies. A social business dollar is recycled and has an unlimited life.”Muhammad Yunus on BBC Radio 4’s Today programme

Page 5: A Manifesto For Social Enterprise In Scotland

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Priority 2 – Building a Skilled Inclusive Workforce through Social Enterprise

Scotland’s geography requires greater dependence on local delivery from smaller providers of employability skills training and job creation. Social enterprises are already part of the solution to this need and are ready to go further. There is also a role for the size, scale and capital of larger social enterprises, working in partnership to provide tailored local solutions.

Social enterprise can also be a successful model for individual entrepreneurs, who can be encouraged to set up their own businesses to provide opportunities for themselves and others in their communities.

We call on the future Scottish Government to recognise and increase the contribution social enterprises make in delivering quality jobs and skills training and to scope our contribution to inform future policy making.

We also call on the future Scottish Government to work towards greater alignment�with�the�UK�Government�programmes in skills training and job creation,�in�order�to�tackle�Scotland’s�current high unemployment in a cohesive and coordinated approach.

Priority 3 – Creating Sustainable Communities through Social Enterprise

Social enterprises in Scotland already play a defining role in developing sustainable cohesive communities. However at a time of constrained public spending and with our communities facing so many challenges, we believe the proactive transfer of public assets to community ownership can underpin social enterprise delivery of local skills, local jobs and amenities.

Recognise the Role of Social Enterprise in Urban Regeneration Large�scale�urban�developments�can�offer�significant opportunities to empower local communities and create local jobs through community ownership of assets.

We call on the future Scottish Government to ensure all new developments include asset transfer provisions to an independent community trust.

Tackle Public Asset Transfer Delays Community�management�and�ownership�of�public assets can support the wider public interest and create community owned social enterprises working for the community good, without incurring unmanageable risk and opportunity costs.

We call on the future Scottish Government to work with all public bodies to tackle asset transfer delays, in particular to introduce a legislative change to permit the transfer of underused assets below market value to local people.

Restore Momentum in the Land Reform Agenda Land�ownership�is�the�catalyst�for�delivering�community-led regeneration and growing community confidence and self reliance. We call on the future Scottish Government to review and extend community right-to-buy legislation with a re-established Scottish land fund to assist community land acquisition.

OvER 70% of people believe that, when buying goods or services from suppliers, ensuring that the supplier passes on some additional benefits to the local community should be most important in their decision.

74% ThINk social enterprises are important to the future of Scotland’s economy.

Ipsos�MORI�–�August�2010

Ipsos�MORI�–�August�2009

Page 6: A Manifesto For Social Enterprise In Scotland

Priority 4 – Achieving Green Communities through Social Enterprise

Social enterprises have a crucial role in�Scotland’s�green�agenda,�working�in�community based renewable energy projects and reducing landfill through waste disposal and recycling. Yet their purpose goes beyond the green agenda, with profits reinvested in their communities to provide local amenities, local jobs and increased opportunity.

Introduce a Community Energy Investment Strategy

In�the�next�ten�years,�significant�investment�in renewable energy could create a source of�income�for�local�communities.�Community�owned energy projects are already proving successful engines for change, allowing local people to improve their quality of life while working with Government in tackling climate change, fuel poverty and energy security. However, at present communities are not always included in arrangements between local authorities and energy companies, while uncertainty around long term investment in community owned energy projects is currently sapping community and volunteer morale.

We believe the connection between community and energy production is vital to endow communities with the means to thrive.

We therefore call on the future Scottish Government to incentivise energy providers and local authorities through the planning process to engage with local communities.

We further call on the future Scottish Government to publish a local energy investment strategy which sets ambitious targets for community energy production across the country with mechanisms for establishing capital investment.

Allow Communities to Generate Income through Local Waste Social enterprises have established successful recycling businesses across Scotland, diverting waste from landfill while delivering local jobs and community skills.

We call on the future Scottish Government to�work�with�Local�Authorities�so�that�first�preference is given to communities to utilise local waste for local economic, social and environmental benefit.

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Priority 5 – Supporting Social Enterprise Businesses

With the current high levels of redundancy and unemployment, we believe that social enterprise is an attractive option for those seeking to create employment for themselves as social entrepreneurs, or for individuals changing careers and looking to start new businesses.

Scotland’s�established�social�enterprises�also�require the business skills to scale up, acquire assets and to create consortia to trade and expand into new markets.

We therefore call on the future Scottish Government�to�ensure�that�Scotland’s�social�enterprises have access to quality tailored business support, with clear, easy signposting for social enterprises whether start-ups or established.

We further call on the future Scottish Government to consider supporting mechanisms for social enterprises to trade knowledge and expertise with each other.

Support the Next Generation of Social Entrepreneurs

Young people are increasingly interested in social enterprise as an ethical business career which transforms lives and local communities.

We call on the future Scottish Government to ensure that learning about social enterprise forms part of school life and to explore with further and higher education institutions how awareness of social enterprise, as a business model and a career option, can be increased.

Actions for a National Culture of Social Entrepreneurship

If social enterprise in Scotland is to fulfil its potential and be allowed to create jobs and address the deep seated social and environmental needs of its citizens, it requires a range of quality business support and access to investment.

Community Energy – Eriskay Community Hall, Western Isles

Eriskay Community Hall facilities provide a much needed community facility for the residents�of�Eriskay.�It�is�used�regularly�for social functions, weddings, sport events, and is used frequently by the local community. High electric running costs of around £3000 per annum and poor heating resulted in the group deciding to install roof insulation and a 6kW on grid wind turbine behind the hall to provide direct heat to the storage heaters.

The group developed the project with the assistance�of�Community�Energy�Scotland�development officers who also granted money�from�Scottish�Government’s�grant�scheme at the time. Savings per annum are over £2000 along with additional income of around £600 per year. Heating costs for this community facility have now reduced to about £300 per year resulting in a thriving community facility.

case study

67% ThINk social enterprises should have a role in the delivery of public services.

85% ThINk it is possible for companies to make a profit and also make a positive contribution to Scotland’s communities.Ipsos�MORI�–�August�2009

Ipsos�MORI�–�August�2009

Page 7: A Manifesto For Social Enterprise In Scotland

A Culture of Social Enterprise – Haven Products, Inverness & Glasgow

case study

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Priority 6 - Access to Capital for Scotland’s Social Enterprises

All businesses need finance. Scotland’s�social enterprises are now at a vital point in their development, with high expectations of their capacity to deliver quality services in their communities at a time of maximum economic constraint. Fulfilling their potential requires imaginative financial solutions involving both public and private sectors, as well as unlocking the reserves of untapped wealth within the sector itself. We call on the future Scottish Government to consider good practice elsewhere to attract a diversity of funding.

Engage With Lenders

Bank lending continues to play a big role in supporting the sector. We call on the future Scottish Government to engage with commercial banks, particularly those in majority public ownership, to ensure that lending to social enterprises is both sustained and increased. When the reforms to credit union�legislation�currently�before�the�UK�Parliament are passed, we ask the future Scottish Government to support the capacity of credit unions to lend to social enterprise to diversify sources of investment in the sector.

Create a Bespoke Loan Guarantee Scheme for Scotland

We believe a loan guarantee scheme for social enterprise would encourage financial institutions to make finance available to support�growth�and�working�capital.�The�UK�Enterprise�Finance�Guarantee�(EFG)�Scheme�is irrelevant for most social enterprises as the guarantee levels are low and charges are high. We therefore call on the future Scottish Government to ensure a bespoke scheme is created to increase the flow of capital into this expanding sector.

Engage With the Uk Treasury on Tax Relief for Social Enterprise Investment

Incentivising�inward�investment�from�private�sector institutions and High Net Worth individuals concerned with community well being,�is�a�key�priority.�At�present�there�is�no equality of investor tax relief between social enterprises and the private sector. We therefore call on the future Scottish Government�to�engage�with�the�UK�Treasury�to�ask�that�Community�Interest�Tax�Relief�(CITR)�is�simplified�and�extended�to�encourage longer-term investment in social enterprises, and that other existing tax relief included�in�the�Enterprise�Investment�Scheme�and�Venture�Capital�Trusts�are�amended�along with the provision of clearer guidance, for investors in organisations delivering social or environmental benefits.

Consider the Argument for Reduced Income Tax for Scotland’s Third Sector

In�line�with�the�Calman�Commission�recommendations for greater fiscal and financial self determination – we ask the future Scottish Government to consider the principle, already successfully established in�Australia,�that�the�Scottish�Parliament�should in future have powers to amend the basic rate of income tax for workers in the Third Sector, to aid sustainable growth, deliver a step-change in innovative public service delivery and ensure that Scotland is positioned as a world leader in social enterprise business.

Introduce Social Impact Bonds

We call on the future Scottish Government to introduce investment mechanisms such as�Social�Impact�Bonds�which�channel�private investment into projects run by social enterprises and third sector organisations. The Scottish Government would provide a financial return to investors, by paying out a proportion of the savings to the public purse that result from improved social outcomes. The more successful the project, the more public money is saved and the higher the return for the investor.

Haven Products provides employment and training opportunities for disabled people; around 80% of its workforce has a�disability.�It�operates�as�a�commercially�viable and efficient business, providing high-quality services and solutions to companies looking to outsource their production processes.

The firm operates from three sites across Scotland: Hillington, Ballieston and�Inverness�and�works�closely�with�the private and public sector through its Complementary�Workforce�which�seeks�to outsource skilled and trained Haven staff to some of the countries largest businesses,�including�IBM,�Standard�Life�and National Semiconductor.

79% AGREEd that people who invest in social enterprises should be given tax relief equal to that received by people who invest in private companies.Ipsos�MORI�–�February�2010

Page 8: A Manifesto For Social Enterprise In Scotland

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MembersAberdeen�Day�Project�Ltd������(The�Bread�Maker)Aberdeen�FoyerAberlour�Child�Care�TrustACE�Credit�Union�ServicesAction�for�ChangeAge�Concern�EnterprisesAlbyn�Housing�SocietyAlloa�Community�EnterprisesArgyll�&�Bute�Social�����Enterprise�NetworkAssociation�of�British�Credit���Unions�LtdAutism�InitiativesBookdonorsBRAG�EnterprisesBuchan�Dial-a-Community� BusCalman�TrustCamphill�ScotlandCBS�NetworkCDA�(Scotland)�LtdCEiSCEMVO�ScotlandCentre�of�Health�&�WellbeingClaverhouse�GroupCommunity�Care�Providers� ScotlandCommunity�Energy�ScotlandCommunity�EnterpriseCommunity�Food�Initiatives���North�EastCommunity�Recycling�Network� for ScotlandCommunity�Retailing�NetworkCommunity�Transport���AssociationCommunity�Woodlands���AssociationCompassion�‘n�ActionCo-operation�&�Mutuality� ScotlandCo-operative�Development� ScotlandCo-operative�Education�Trust� ScotlandCornerstoneCrescent�KitchenCunninghame�Housing���AssociationDevelopment�Trusts���Association�ScotlandDunedin�Canmore�Housing���AssociationElite�LinguistsEmployers�for�ChildcareFirstport

Forth SectorGrampian�Housing�AssociationGREC�GraphicsHaven ProductsHealth�Inequalities�AllianceHebridean�ChocolatesHighlands�&�Islands�Social���Enterprise�ZoneImpact�ArtsInspiralbaInspire�VenturesInstitute�of�Local�TelevisionInstitute�of�Occupational� MedicineInverclyde�Association�for� Mental HealthLanarkshire�Enterprise� ServicesLink�GroupLinked�Work�&�Training�TrustMcSenceMediaco-opMoray�Social�Enterprise� NetworkMull�&�Iona�Community�TrustNorth Glasgow Housing ��AssociationPort�of�Leith�Housing���AssociationReal�Work�SkillsScottish Borders Social ��Enterprise�ChamberScottish�Churches�Housing���ActionScottish Federation of Housing ��AssociationsScottish�League�of�Credit� UnionsSend-itSenscotSKSscotlandSocial�Enterprise�AcademySocial�Enterprise�ClydebankSocial Firms ScotlandSocial�Investment�ScotlandSpeyside Trust (Badaguish ��Outdoor�Centre)Spruce�CarpetsSupporters�Direct�in�ScotlandThe�African�&�Caribbean���Network�LtdThe�Big�Issue�ScotlandThe�Clean�Close�CompanyThe�Engine�ShedThe Factory SkateparkThe�Kibble�CentreThe Melting PotThe Wise Group

UK�Credit�UnionsUnity�EnterpriseWith PeopleYou�Can�Cook

AssociatesACOSVOCreation�LtdFife�Social�Economy�� PartnershipGlasgow�Caledonian�UniversityGlasgow�East�Regeneration���AgencyGlasgow South West ��Regeneration�AgencyKeegan�&�PennykidMacRobertsR.I.E.R.�Social�Economy�� PartnershipRoyal�Bank�of�ScotlandScottish�Chambers�of���CommerceScottish�Council�for���Development�&�IndustryScottish�Financial�EnterpriseScottish�Urban�Regeneration� ForumShell�UKSocial�Enterprise�Alliance� MidlothianStandard�LifeThe�Co-operative�BankThe�Faculty�of�Advocates�Free����Legal�Services�UnitThe Grange GroupThe Scottish Parliament ��&�Business�ExchangeTriodos BankUnity Trust BankVoluntary Sector Gateway West�Lothian

Individual AssociatesJanet BarnesCharles�BrodieIsobel�d’InvernoSteve�EbbittDavid�HerdMartin MeteyardAnne-Marie�McGeochJackie ScuttSandy SlaterKenneth�TomoryPaul�Zealey

Scottish Social Enterprise Coalition Members & Associates

What’s next? We ask all parliamentary candidates to sign up to the Social Enterprise in Scotland Charter to demonstrate their support for social enterprises and the policies set out in this manifesto for social enterprise.

To view our Charter, please visit www.scottishsocialenterprise.org.uk/2011holyroodelections

Thank you for your support.

Page 9: A Manifesto For Social Enterprise In Scotland

Championing business with a social purpose

Thorn house, 5 Rose Street, Edinburgh Eh2 2PR

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www.scottishsocialenterprise.org.uk

Join usThe Scottish Social Enterprise Coalition is the national collective campaigning voice for social enterprise in Scotland. It represents the needs and interests of social enterprise to politicians, policy makers and opinion formers through its members. Each April, the Coalition runs the S2S Social Enterprise Fair which attracts more than 500 delegates from across the uK. www.s2sfair.com

Contact us for more information and for details on how to join to make youR voice heard:

T. 0131 243 2650 E: [email protected]