Public Services (Social Enterprise and Social Value) Bill

Dan Byles Excerpts

Friday 19th November 2010 Commons Chamber

[Harriett Baldwin]

I thank my hon. Friend for that informative intervention. I, too, represent a constituency that has many shining examples of big society organisations. From my perch on the investment committee at the Social Investment Business, I have been able to see many different social enterprises across the land that are flourishing—from Salford to Stratford—and that would be helped by being brought to the attention of public service procurers in other areas. By outlining the need for a national strategy, my hon. Friend the Member for Warwick and Leamington has introduced a very helpful Bill.

As we all know, there is allegedly no money left, so it will probably not be as easy as it was to help the social enterprise sector. I am sure that the right hon. Member for Salford and Eccles would agree that even had her party been elected to government it would have found it difficult to provide similar amounts for funds such as the Futurebuilders fund as they did before. Therefore, we need to emphasis the role that foundations, philanthropists or people who would like to invest in an ethical individual savings account could play by providing a portfolio of funding to help to draw on the experience that Government money has developed over the years, as well as the low default rate and good rate of return.

[Dan Byles (North Warwickshire) (Con)]

What I find most interesting about my hon. Friend’s speech is that she is making the clear point that social enterprise is not the same as charity, and that it can be a financially and economically sustainable model.

[Harriett Baldwin]

Indeed. I do not want to rule out the possibility that charities may want to use loan finance from time to time; obviously, they often do. My point is that, in this sector, we do not need to rely solely on help from Government procurement and funding. I want to put on record that if it is to continue to experience rapid growth, there is also a role for other providers of capital. We have had the fascinating example of the social impact bond. I believe that contract involved a charity, rather than a social enterprise, which was looking at a way of reducing reoffending rates. The rate of return that investors could earn on the social impact bond was a function of how successful the charity was in delivering on that contract. That is another creative and innovative way to find more money to help the social enterprise sector to grow.

With the Minister in his place on the Front Bench, I would like to take the opportunity to refer to a policy that the Conservative party was considering in opposition—the role of the social enterprise zone as a means of the Government helping social enterprises in particular areas to attract money from private investors through additional tax breaks.

This is potentially a very powerful and excellent Bill, and I am delighted to urge all my colleagues and all Opposition Members to support it.

--- Later in debate ---

[Mr Gyimah]

I certainly think we should allow charitable enterprises to tender for contracts and deliver services, rather than see this as a way for for-profit businesses to service government.

[Dan Byles]

I am not entirely sure that I agree with my hon. Friend that there is such a clear distinction between for-profit businesses and organisations involved in social responsibility. Many private sector companies take their corporate social responsibility very seriously, and a number of private sector for-profit companies in my constituency are heavily involved with community groups, charities and social enterprise, because they feel it is the right thing to do for their corporate image and for the wider community.

[Mr Gyimah]

I do not suggest for a second that no private for-profit businesses have a social objective—a lot of for-profit companies do take that responsibility seriously—but I see the Bill as a way of encouraging organisations whose main purpose is to deliver services that could be delivered by the state for the community. To take the argument to an extreme, in my view it would be unusual—