amendment of the law

Debate between Iain Duncan Smith and Hazel Blears

Tuesday 25th March 2014 Commons Chamber

[Hazel Blears (Salford and Eccles) (Lab)]

It is a pleasure to follow the hon. Member for Stourbridge (Margot James). I want to concentrate my remarks on the social economy. I draw the House’s attention to my—unpaid—entry in the Register of Members’ Financial Interests.

Since the crash of 2008, there have been a difficult few years for countries around the globe. Many companies have struggled to find investment and to grow. Ordinary people have very often been faced with redundancy and unemployment. That particularly applies to our young people, of whom nearly 1 million are struggling to find work. Public services have been cut quite dramatically, and many are facing increased demand at the same time, none more so than in the spheres of the national health service and social care.

Against that very difficult background, and as we enter what I certainly hope will be a period of better economic news of sustained growth and job opportunities, we have a real chance not to do business as usual, but to take a new path towards what many of us have talked about in this House—a more responsible capitalism. At the moment, it is still a fairly nebulous concept, but I believe that we can start to put some flesh on the bones and to invest in the social economy.

For the past 18 months, I have convened a group of local authorities, social enterprises and some large corporate firms to consider how we might come together to get the public sector, the private sector and the third sector to work in a much more integrated fashion. We have done that under the banner, “Doing good is good business”. Social enterprise has always been a passion certainly of mine, but it is now taking a much more central position in our economy. In this country, there are 70,000 social enterprises, which contribute £18.5 billion to the UK economy and employ about 1 million people. It is no longer a niche part of our economy, but is becoming absolutely mainstream. In Europe, one in four new businesses that starts up is a social business. Some 35% of people who left private sector employment last year have gone into the social economy. It is really moving on apace. There are now many brilliant social enterprises. I have Unlimited Potential and Social adVentures in Salford. In the constituency of every hon. Member, there will be social enterprises that not just provide jobs and opportunities, but bring into our economy the absolute gold dust of innovation and creativity.

I want us to give a real boost to social enterprise on a cross-party basis, but we also need to do something about public procurement. The Public Services (Social Value) Act 2012, which I helped to take through the House, empowers public authorities to take into account social, economic and environmental impacts, as well as value for money. That can be absolutely transformational, provided that we get behind it, give it teeth and really make it work.

[Mr Duncan Smith]

I pay tribute to the right hon. Lady, whose work in this area has been really first rate. I told her that last time we met, over dinner at Apsley House, but I am just dropping names. Will she take her point a little further, because the creation of social impact bonds is a very big and important area? I know that she is a big supporter, but how does she see that rolling out, particularly now that the Budget will bring in tax relief for it?

[Hazel Blears]

I am absolutely delighted that social investment tax relief has been set at 30%. Some estimates suggest that that might liberate up to £500 million of extra investment into the economy. At a time of austerity and when there is very little public money about—whichever party is in power—we must absolutely seize the possibility of mobilising private capital for public good.

I pay tribute to the Secretary of State, because he has been a pioneer. He set up his social investment fund, which has catalysed the market in Department for Work and Pensions areas. I have spoken to the Secretary of State for Education to try to get something similar in relation to social mobility and educational attainment, and he is very interested. I said to him, “The Secretary of State for Work and Pensions is a bit of a pioneer, so why don’t you get involved in this as well?” I have also spoken to the Minister of State, Department of Health, who has responsibility for social care, to look at social investment bonds for the care of the elderly, particularly in relation to dementia, which is a huge issue for all of us and, indeed, countries across the world. Mobilising private capital to enable us to transform public services is an extremely exciting agenda.

I want to say a word about the Public Services (Social Value) Act, because a whole range of local authorities are now taking up the new powers, including my own in Salford, as well as Liverpool, which has declared itself a social value city, Birmingham, Wakefield, Hackney and Lambeth. People from all political parties and local authorities of all shapes and sizes want to commission in this new way. We now need transparency, through metrics and measurements, so that the people on this playing field can get some recognition.

One of the most exciting things is that some companies in the private sector want to do exactly the same in moving from traditional corporate social responsibility into using their mainstream business model to make a social impact. Companies such as Fujitsu, Veolia, Interserve and CH2M Hill are now looking at their supply chain to see how they can get social enterprises and small businesses to bring them the agility and creativity that such big global enterprises sometimes cannot put into the system. In particular, Fujitsu has done a report called “Collaboration Nation” about building a very different supply chain. It has told me that it absolutely sees the business case for doing so, because it is able to develop new products. It is also attracting the best talent, because these days young people want to work for an organisation that has values, and to go home at the end of the day being proud of what they do. All those private sector companies want to do that and be responsible capitalists in that way, but we must encourage them and recognise that this will be a long-term agenda.

I say to the Chancellor and the Secretary of State that if we could extend the Public Services (Social Value) Act to goods and infrastructure—that is where the big spend will be in the next 10 to 15 years, not necessarily on services and revenue expenditure—why can we not have social clauses in procurement for High Speed 2, for the possible new airport, or for regeneration projects that bring apprenticeships, get a better supply chain and make a social impact?

As I said, I am delighted that social investment tax relief is being brought forward. We now lead the world in that, and at the G8 meeting that I was privileged to attend we could see how much the United Kingdom’s creativity has taken that forward. There are now a whole range of new social investment bonds. We have just signed one off in Manchester to help young people come out of care, and to provide foster care and adoption, which is an amazing ability.

When I went to Brussels last week I met Commissioner Andor, who was hugely encouraging about social procurement and social investment. We are about to launch some local investment funds. The first was launched in Liverpool two weeks ago, and we would like to have 10 to 15 across the country over the next year. We are hoping to do that in Greater Manchester, bringing together European Union structural social funds with social investment, to provide unsecured loans to social enterprises of £50,000 to £100,000—exactly the kind of loans they need.

All that brings the social economy into the mainstream. We used to think about social enterprise as a niche or an add-on to the mainstream economy, but no longer. If we take what measures we can to make social procurement mainstream, including goods and infrastructure, and to support social enterprises to make social investment and the market grow in the long term, we can genuinely harness the innovation that is often in social enterprise, together with people who want to do capitalism in a more responsible way and the engine of the public sector. In doing that we will show that “doing good” really is good business.

Amendment of the Law

Debate between Iain Duncan Smith and Hazel Blears

Tuesday 29th March 2011 Commons Chamber

[Mr Duncan Smith]

That gives me an opportunity to put the shadow Chancellor right. He said in one of the Budget debates last week that the structural deficit was low as we entered the recession. We had the highest structural deficit in the whole developed world, and intriguingly he is in denial about that, so whether he talks about debt or deficits, in reality as we entered the recession, the economy had been badly run, leaving us with a record structural deficit.

Importantly, what has been Labour’s response as a result of that? Acceptance that it had lost control; perhaps even a little humility? Not a bit of it. Instead, we have seen a desperate scramble to find almost anybody else to blame for the problems, and it appears, even today, no attempt to make any amends publicly. In the Labour playbook, the previous Government were just innocent bystanders in somebody else’s evil game. Poor old Britain. Apparently, we were just minding our own business when along came some nasty industrialists and bankers who ganged up on us in some international capitalist conspiracy. It is like some ghastly, poor script. It really does read like some really poor script from an Austin Powers movie, and I am pretty sure that any minute now the shadow Chancellor is going to try to blame Dr Evil and bring him into the script as well.

[Hazel Blears (Salford and Eccles) (Lab)]

Is the right hon. Gentleman suffering from some kind of amnesia? Has he forgotten that, after some 20 years of the previous Conservative Government, we had almost 3 million people unemployed? In two of my inner-city wards, I had 50% male unemployment and 75% youth unemployment. Is the right hon. Gentleman about to embark on the same mistakes that caused such massive unemployment after 20 years of the previous Tory Government?

[Mr Duncan Smith]

It is always a pleasure to give way to the right hon. Lady, because if anything she is always honest with her own side. I understand that quite recently she said that her own party had been pretty much unrealistic about the situation, and I seem to recall that she even said that it should be more specific about what reductions it would make. She was a part of a governing party that left this country with the worst recession, the worst deficit and massive debts, so I do not need to explain where we were in ’97; she needs to explain why we got to where we were at the last election.

Oral Answers to Questions

Debate between Iain Duncan Smith and Hazel Blears

Monday 22nd November 2010 Commons Chamber

[Mr Duncan Smith]

I will give those details soon. I will not give them today, but I can say that we have already been working on the issue. We believe that, as things stand right now, we will manage the cost within our present budgets—it will not require anything extra for us. Of course, as the right hon. Gentleman said, it forms a challenge to us—I accept that—but localising elements of benefits is important to local people, and councils have very much wanted to do this. I will definitely give him the figures for that in due course, but we believe that we will be able to manage it, and I am more than happy to discuss that with him.

[Hazel Blears (Salford and Eccles) (Lab)]

3. What steps he is taking to encourage social enterprises to become providers under the Work programme.