Public service delivery through social enterprise

I spent this morning at the Public Service Delivery Through Social Enterprise event held at RIBA in central London. A good mix of people from social enterprises, commissioners and public sector staff.

First up is Eilis Lawlor from the New Economics Foundation who talks about its approach to social return on investment. Her main point is that a focus on outcomes, not outputs, is needed when measuring the success of public service delivery.

She also says that it needs to be ok to report on failure. Too often failing services are continued due to poor reporting. Instead, organisations should acknowledge failure, learn from it and adjust services accordingly.

Next is John Tizard from the University of Birmingham with a talk titled Social enterprise - the time is right. He says that increasinhly governments are looking to the private sector to deliver public services. However, public confidence in the private sector is currently very low and that creates a great opportunity for the third sector to get further involved in public service delivery.

Over the next couple of years we will see a 15-20% reduction in public sector spending. This will put a greater emphasis on commissioning, but also on decommissioning. Often the case will be deliver ‘more for less’ or at least ‘the same for less’. This presents an opportunity for the third sector to show that is has greater flexibility than the private and public sectors. The message he presents is that there are major opportunities across public services but they won’t be delivered on a plate. If the sector can’t show that it can bring additional value and innovation commissioners will simply go elsewhere.

After the break, Stephen Bubb, CEO of ACEVO and Chair of The Social Investment Business talks about the barriers facing the third sector when it comes to public service delivery. He begins by mentioning Replacing the state?, which, when it was first published seven years ago was widely derided for saying that there were deep problems with state delivery of public services and that the third sector would be much be better placed to do it.

But now, he says, times have changed. Both main political parties are committed to less state provision and more provision by the private and third sectors.

However, there are three main barriers to the third sector getting involved in the delivery of public services. The first is cultural - the public, commissioners and policy makers don’t realise how big a an economic force the sector is. This needs to change.

The second is around funding and commissioning. Commissioners need to take a business like approach to the sector and provide long-term contracts so that organisations can get investment to run services properly.

The third reason is around capacity. The sector is weak in infrastructure because it has always been difficult to capacity build due to the short-term nature of the funding. The sector has also been cut off from the capital markets which the private sector relies on for innovation. In the third sector only really large, national charities are able to get bank loans. This can hopefully be helped by the creation of the social investment bank and what is the reasoning behind the establishment of The Social Investment Business, he says.

Next is Richard Lichfield, CEO of Eastside Consulting and interim CEO of 3SC, the third sector public service delivery consortium. He says that there are two things needed for social enterprises to get involved in public service delivery. The first is innovation, new solutions to deliver public services. The second is partnerships, allowing smaller organisations to get together to bid for larger contracts.

He says that 3SC brings together third sector organisations - so far over 350 of them - and acts as a prime contractor to win public sector contracts. The work is then carried out by the member organisations. 3SC has already won the largest DWP Future Jobs Fund contract, worth £20 million, to deliver jobs for long term unemployed.

Then it’s time for lunch, and I head back to the office.

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