8 aspects of good practice in support for WISEs

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8 aspects of good practice in support for WISEs (work integration social enterprises) - lessons from EQUAL

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  • Art. 19 of procurement directive only allows restricted tenders to firms with 50%
  • 8 aspects of good practice in support for WISEs

    1. 1. European Social Fund 1     Eight aspects of good practice in support for WISEs Lessons from EQUAL Toby Johnson, AEIDL/DIESIS, Brussels toby.johnson@poptel.org
    2. 2. European Social Fund 2 Outline 1. What are WISEs? 2. EQUAL and WISEs 3.Eight aspects of good practice 4. Recommendations
    3. 3. European Social Fund 3 1. What are WISEs?
    4. 4. European Social Fund 4 Work Integration Social Enterprises = ‘social firms’
    5. 5. European Social Fund 5 Terminology Social economy WISEs Social enterprises
    6. 6. European Social Fund 6 Social economy economic activity for a social goal 4 families: co-operatives mutuals associations foundations 11 million jobs in EU-25 8% of jobs
    7. 7. European Social Fund 7 Social economy employment Country Co-ops ’000s Mutuals ‘000 Associa- tions ‘000 Total FTE ‘000 % FTE AT 52 7 174 234 8.1% BE 33 11 162 206 7.1% DK 78 - 211 289 13.8% FI 76 - 63 139 8.2% FR 294 91 830 1,215 6.8% DE 448 131 1,282 1 861 6.5% EL 12 1 56 69 3.5% IR 32 1 119 152 15.9% IT 480 - 667 1,147 8.2% LU 2 - 5 7 4.6% NL 109 - 660 769 16.6% PT 49 1 61 111 3.5% ES 403 1 474 878 10.0% SE 91 7 83 181 5.8% UK 128 22 1,473 1,623 8.4% TOTAL 2,286 274 6,319 8,880 7.9%
    8. 8. European Social Fund 8 Concepts of social enterprise OECD, 1999 different legal forms in different countries entrepreneurial spirit both social and economic goals, e.g.: training & integration of disadvantaged people revitalisation of deprived areas provision of new products & services innovative solutions to unemployment & exclusion UK – Social Enterprise Unit, 2002 competitive business primary social objective [but only 1 CIC refused!] surpluses principally reinvested in business or community no criteria of ownership or participation
    9. 9. European Social Fund 9 Concepts of social enterprise France – AVISE, 2004 social values & objectives, as regards: employees (work integration) users/clients (disadvantaged, poor ...) products & services (fair trade) legal status (co-op, association, social co-op) Finland – Ministry of Labour, 2004 on official register >30% employees disabled / unemployed no non-profit criterion no criteria of ownership or participation
    10. 10. European Social Fund 10 Concepts of social enterprise Italy – 2005 non-profit private organisation mainly perform a stable economic activity in prodiction, exchange of goods or social benefit services aimed at solving issues of general interest
    11. 11. European Social Fund 11 Social enterprise characteristics hybrid of co-operative/mutual and voluntary/associative sectors multi-stakeholder: users, workers, volunteers, community, funders… resource mix: earned, grant, donations, voluntary time social capital: trust & co-operation strong user linkages worker involvement www.emes.net
    12. 12. European Social Fund 12 Social enterprise ideal type 4 economic criteria continuous trading activity autonomy economic risk paid workers 5 social criteria explicit aim of community benefit citizen initiative decision making not on basis of capital participation - user involvement limited profit distribution www.emes.net
    13. 13. European Social Fund Types of WISE ELEXIES study (EMES 2003, 12 MSs) 44 types in 4 groups: permanent wage support self-supporting / tapering wage support (re)socialisation through work transitional wage support 13
    14. 14. European Social Fund 14 4 groups of WISEs (EMES) EIf AIf ETTIf GEIQf EFTb LVdk BWg KBg BLUIg VOfin ONCEs EIs CEEs STOfin ILMOuk VOuk COSOi RQf CBuk WCOuk SBGg EIp EIb IBb EINf sw SFuk Ruk ETAb BWb SWb SHsw EPp SEirl SKsw AZCb CAVAf COs
    15. 15. European Social Fund 15 Social objectives 3 broad fields: inclusion through work service provision: social, environmental, cultural... value-based activity, esp. fair trade
    16. 16. European Social Fund 16 Social enterprises in the UK 55,000 enterprises, €40 bn turnover, ½ m jobs
    17. 17. European Social Fund 17 Social firms in the UK 10m people in UK have a disability! 5  150 in 10 years – growth 10% p.a. half >25% severely disadvantaged 1,700 fte jobs (52% for disadvantaged) catering 52%, recycling, horticulture largest = Pluss: 470 jobs, t/o €30m p.a. funding largely by social services trade directory: www.trade.socialfirms.co.uk
    18. 18. European Social Fund 18 Social Firms UK Strategic partnership with Office of Third Sector 5-year MoU stipulates: represent views & experience of sector raise awareness of social enterprise spread good practice (Star scheme, visits) influence government policy remove barriers to growth reach out to BAME separate financial agreements
    19. 19. European Social Fund 19 Star social firms standard (1) Enterprise + Employment + Empowerment Enterprise: non-profit / co-op trading structure employment objectives half income from market independence (desirable)
    20. 20. European Social Fund 20 Star social firms standard (2) Employment: 25% of workers severely disadvantaged parity of treatment between all workers contract of employment market or minimum wage staff development legal compliance (EO, H&S etc.) “acknowledged as good employer” disadvantaged at all levels (desirable) IIP accreditation (desirable)
    21. 21. European Social Fund 21 Star social firms standard (3) Empowerment: adjust to employees’ needs volunteer agreements stress management procedures staff development a priority participation in decision-making confidentiality disability, equality & awareness training training for disadvantaged staff social accounting (desirable)
    22. 22. European Social Fund 22 2. EQUAL & WISEs
    23. 23. European Social Fund 23 EQUAL – scale & scope R&D dep’t of the European Social Fund Community Initiative – experiments to make mainstream more effective Budget: €3 billion / 6 years 3 ‘actions’ Development partnerships: Round 1 (2002): 1,399 Round 2 (2005): 2,081 Total: 3,480
    24. 24. European Social Fund 24 Social economy in EQUAL 3rd most popular of 9 themes 9% of EQUAL budget 424 development partnerships 7 partners on average  3,000 organisations involved average DP budget €1.3m (UK ave €2.2m ... SK ave €0.2m)
    25. 25. European Social Fund 25 159  265 social economy DPs Country Round 1 Round 2 Italy 71 111 Poland - 25 Slovakia - 24 France 28 24 Finland 6 13 Greece 5 10 UK (GB) 8 10 Czech Republic 2 9 Germany 8 9 Netherlands 6 9 Austria 16 8 Portugal 6 7 Flanders 3 4 Wallonia - 2
    26. 26. European Social Fund 26 Main themes of EQUAL 2 DPs All DPs - Main theme (N=265) 158 59 35 13 0 20 40 60 80 100 120 140 160 180 Business development (60%) Individual development (22%) Institutional framew ork (13%) Territorial development (5%)
    27. 27. European Social Fund 27 Main clusters in EQUAL 2 0 10 20 30 40 50 60 70 80 Institutional framework conditions Business start-up & incubation Sector & cluster development Work integration
    28. 28. European Social Fund 28 Activity chain – round 1 workshops, Brussels, October 2003 Strengthening the Social Economy, Antwerp, May 2004 workshops, Brussels, June 2004 European social economy conference, Kraków, October 2004
    29. 29. European Social Fund 29 Activity chain – round 2 Building the case for, and the capacity of, the social economy: Showcase, Warsaw, 10-12 May 06 Local development, Rome, 4-5 Dec 06 Social enterprise, Helsinki, 5-6 Feb 07 Policy forum, Hannover, 5-6 Jun 07 Procurement, Antwerp, 10-11 Apr 08
    30. 30. European Social Fund 30 3. Eight aspects of good practice in support for WISEs
    31. 31. European Social Fund 31 8 aspects of support to WISEs 1. government strategy 2. legal & financial framework 3. local partnerships 4. business support 5. sectoral development strategies 6. access to larger markets 7. impact measurement 8. community of practice
    32. 32. European Social Fund 32 1. UK social enterprise strategy ambitious: aimed to achieve a step change proactive: defined the concept comprehensive & integrated participative capacity-building (SEC) accountable partner-oriented (EQUAL)
    33. 33. European Social Fund 33 UK social enterprise strategy Create an enabling environment Government role: interdepartmental, enabling, direct support e.g. Social Enterprise Coalition Legal and regulatory, e.g. Community Interest Company Public procurement Make social enterprises better businesses Business support and training Finance and funding Establish the value of social enterprise Establish knowledge base (research) Recognise achievement and spread the word Create trust: social audit and quality
    34. 34. European Social Fund 34 Scaling New Heights (2006) Aims: engendering cultural change improving the supply of advice and finance improving relations with the public sector Activities: fostering a culture of social enterprise ensuring the right information and advice are available enabling social enterprises to access appropriate finance enabling social enterprises to work with government
    35. 35. European Social Fund 2. Legal frameworks Germany – Integrationsfirma Italy – type B social co-operative Austria – Beschäftigungsbetrieb Greece – KoiSPE UK – social firm France – SCIC Finland – social enterprise 35
    36. 36. European Social Fund 36 Community Interest Company (UK) permissive, flexible, popular (1,650) light regulation any type of company no tax relief community interest test reasonable investor return dividend cap & asset lock possible access to public contracts
    37. 37. European Social Fund 37 Social firms for the mentally ill Synergia, Greece KoiSPE dual status: business + mental health unit membership by MH professionals investment shares in-kind support local development impact
    38. 38. European Social Fund 38 3. Local co-planning Agenzia de Cittadinanza, Milan broad partnership (91 partners) build SE capacity – bilancio sociale defragment social service delivery 4 local piani di zona local tavoli changed the balance of power procurement via negotiated procedure
    39. 39. European Social Fund 39 Neighbourhood services Werk.Waardig, Kortrijk jobs, services, quality of life base on needs analysis multiple activities, multiple financing = ‘cloverleaf model’ service vouchers public recognition of new needs, e.g. flexible childcare
    40. 40. European Social Fund 40 19 new sources of jobs Everyday services Home help, childcare, ICTs, young people in difficulty Improving the quality of life Housing, security, transport, public spaces, local shops Culture & leisure Tourism, audiovisual, heritage, local culture, sport Environment Waste, water, protect natural areas, pollution, energy
    41. 41. European Social Fund 41 The cloverleaf model Employment E.g. wage subsidy for hiring risk groups such as LTU, compensation for lower productivity and/or extra guidance Client User charges (plus sometimes consumer subsidy through service vouchers) Other policies E.g. childcare, homecare, tourism, mobility, culture Local authority e.g. social tender for community added value, cohesion, community development, poverty
    42. 42. European Social Fund 42 4. Dedicated business support Coompanion (FKU), Sweden 25 local agencies total income €6.7m baseline state funding – stability local matching funding – rootedness & partnership loose federal structure community of practice – 85 workers political voice
    43. 43. European Social Fund 43 Mainstream business support QUASAR,Italy social enterprises are a market! national partnership between co-op consortia & chambers of commerce 8 local observatories 7 working groups enterprise check-ups training for advisers
    44. 44. European Social Fund 44 Co-operative incubators Business & employment co-operatives, France A 3-phase career: supported entrepreneur salaried entrepreneur member entrepreneur
    45. 45. European Social Fund 45 5. A successful sectoral strategy Electronic waste (WEEE) seize new opportunity (EU regulation) stress social added value multiple benefits for multiple stakeholders multiple finance sources for multiple activities public and private partners European network (RREUSE) EEIG (SerraNet)
    46. 46. European Social Fund 46 Recycling Ökoservice, Graz value driven: waste / jobs / locality 3-way partnership complementary activities entrepreneurial corporate status wage subsidy network of contacts in local authorities national + European networks + EEIG
    47. 47. European Social Fund 47 6. Social franchising open source vs. patented mobilise idle local resources local capacity building Le Mat (IT – hotels) CAP Märkte (DE – supermarkets) CASA (UK – home care) Vägen Ut! (SE – halfway houses)
    48. 48. European Social Fund 48 Home care Sunderland Home Care Associates 185 employees employee ownership – annual share bonus low staff turnover  higher quality care franchisor CASA – reciprocal shareholding with franchisees
    49. 49. European Social Fund 49 Social franchising methods return to innovation patent or open source licensing / social franchising conditions: (socially) profitable business idea support from franchisor professional enough team enough money to invest
    50. 50. European Social Fund 50 Self-help sectoral development marketing / branding / internet joint purchasing specialisation development fund supply chain integration transnational trading
    51. 51. European Social Fund 51 Public procurement BEST Procurement, East Midlands,UK act on both supply & demand build capacity through training & consortia build technical skills of procurement professionals make ‘business case’ for achieving best value leadership from EU & MS governments
    52. 52. European Social Fund 52 Public procurement (2) get in early use negotiated procedure more? target development work on identified market opportunities division of benefits  joint commissioning  outcome-focused procurement interdepartmental learning platfroms ministers take initiatives to get synergies
    53. 53. European Social Fund 53 7. Quality & impact measurement shared values quality indicators (qualitative + quantitative) branding, visibility simplicity don’t make it a burden www.proveandimprove.org New Economics Foundation,UK
    54. 54. European Social Fund 54 Impact measurement Socio-economic reporting (Sweden) Nilsson & Wadeskog studied 2 social co-ops for ex- addicts in Göteborg in 2005: Basta (65 mainly men) & Vägen Ut! (19 mainly women) mapped 130 factors in 5 clusters: income, treatment, crime, housing and children – each addict in effect employs 2½ people if someone stays 3 years, the municipality pays out €31,500 but society saves €595,000 – a return of 1,890%. social profit of €110,000 per employee per year www.seeab.se
    55. 55. European Social Fund 55 Social firms for ex-addicts Egenmakt för Framtiden,Sweden Basta, Basta Väst ... competitive enterprise peer support empowerment – colleagues not clients social return – reduced cost of crime practical basis for qualifications
    56. 56. European Social Fund 56 Impact measurement Socio-economic reporting (Finland) A workplace has 33 disabled employees, of whom 24 paid a wage, 6 pension + wage and 3 wage + wage subsidy. It receives a subsidy of €297,000, but pays €391,000 in tax and national insurance, resulting in a net benefit to society of €95,000. Deduct: costs that would have been incurred if the workplace had not existed. (It is estimated that 20 of the employees would be on unemployment benefit, 4 working on the open market and 3 working but receiving a wage subsidy.) = €121,000 in expenditure, of which €75,600 flows back to the state, leaving a net cost of €45,400. Adding these two together, the workplace generates a social benefit of €140,000, equivalent to €4,300 per disabled employee per year.
    57. 57. European Social Fund 8. Community of practice COPIE = Community of Practice on Inclusive Entrepreneurship “A group of people who share a concern, a set of problems, or a passion about a topic, and who deepen their knowledge and expertise by interacting on an ongoing basis” 57
    58. 58. European Social Fund COPIE online tools COPIE = Community of Practice on Inclusive Entrepreneurship wiki: www.wikipreneurship.eu best practice database: www.copie.esflive.eu 58
    59. 59. European Social Fund 59 4. Recommendations
    60. 60. European Social Fund Conclusions & issues level playing field compensate WISEs for lower productivity: “3 Cs”: compensation, capital, consultancy encourage entrepreneurial behaviour be permissive not restrictive definition of disadvantage percentage of disadvantaged people issue over labour law and minimum wage 60
    61. 61. European Social Fund 61 Government recognition measure social added value compensate for costs of integration more rational public procurement braided support system

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