Social Enterprises and Community Ownership

Sarah Olney Excerpts

Wednesday 18th March 2026 Westminster Hall

[Sarah Olney (Richmond Park) (LD)]

It is a pleasure to serve under your chairship, Sir John, and I congratulate the hon. Member for Leigh and Atherton (Jo Platt) on her work in securing this debate.

The current landscape is extremely challenging for businesses of all kinds across all sectors, including social enterprises. I am sure that colleagues from across the House have heard from countless local businesses in their constituencies, on their high streets and in the heart of their communities, about the challenges they face, which range from the Government’s national insurance rise to sky-high energy bills and uncertainty over what the Employment Rights Act 2025 might mean for them.

Social enterprises are a major part of the UK economy, with around 131,000 social enterprises operating across the country. Together, these organisations generate around £78 billion in turnover every year, which shows that they make an impact economically as well as socially. They reinvest their profits to support social and environmental missions, with around £1 billion being reinvested annually into local communities.

The sector also provides jobs for millions, with around 2.3 million people working in social enterprises across the UK. Social enterprises are often more inclusive employers, helping people from disadvantaged backgrounds to enter the workforce and tackling barriers around gender, race, class and disability.

Community-owned organisations help to strengthen local economies by keeping wealth circulating locally and giving residents a direct stake in the services and businesses that shape their communities. However, many of these organisations face major challenges, including limited access to finance, rising operating costs and difficulty in navigating complex procurement systems. Without stronger support from the Government, many social enterprises risk being unable to scale their work, despite the enormous benefits that they bring to their communities. As we have heard from so many contributors today, community ownership also plays a growing role in protecting important local assets, such as pubs, shops, energy schemes and community centres, ensuring that they remain viable and locally accountable.

As we see unemployment at alarmingly high levels, the Government should be doing everything they can to support these organisations, which provide vital opportunities to local people. However, with employment costs rising sharply, access to a skilled workforce is an increasing issue that affects businesses of all kinds across the country. The Liberal Democrats welcomed the industrial strategy last summer and the commitment to an increase in skills and training, but the apprenticeship levy does not work: many businesses cannot get the funding that they need to train staff, and hundreds of millions of pounds of funding go unspent. We have been calling for the apprenticeship levy to be replaced with a wider skills and training levy, which would give businesses more flexibility over how they spend their money to train their staff.

It is welcome that the Government are focusing resources on training young people, but it is essential that opportunities for training and reskilling are available throughout life. The decision to defund level 7 apprenticeships for the over-22s risks limiting opportunities at a moment when it is more important than ever to provide opportunities for our young people.

More broadly, social enterprises, like many other kinds of businesses across the country, are struggling under Government decisions such as the rise in employer national insurance contributions. That continues to be the No. 1 issue raised with me when I speak to stakeholders and business owners. Small businesses in particular have been left struggling under the heavy burden of this jobs tax, and the Government must take steps to support those businesses, which are at the centre of communities and local economies. Thousands of social enterprises, which often provide community services, have felt the damaging impact of those changes. That is why I and all my Liberal Democrat colleagues have repeatedly called on the Government to reverse the rise in national insurance contributions and will continue to campaign for them to scrap this damaging policy.

The Liberal Democrats have also been calling on the Government to introduce vital reform to the business rates system. In 2019, the Conservative Government promised a fundamental review of business rates, but failed to deliver it. The current Government pledged in their manifesto to replace the system, but their recent Budget did not bring forward welcome changes for business. The Chancellor announced lower business rate multipliers, but the new, higher rateable values from the Valuation Office Agency will wipe out any benefit that businesses get from the lower multipliers, so I ask the Minister how the Government now plan to meet their own commitment in the small business strategy to introduce permanently lower business rates.

Liberal Democrats have always believed in helping individuals to be involved in the decisions that affect their lives. We believe that employee participation in the workplace, together with wider employee ownership, is important for diffusing economic power, promoting enterprise, increasing job satisfaction and improving service to customers. As we see business confidence down and unemployment up, I urge the Government to consider urgent steps to ensure that those vital policies will allow these important organisations to thrive.