Public sector administration and public service delivery are being reshaped – in Great Britain. But as the UK Government adopts radical policies to create a ‘Big Society’ in which charities are increasingly being contracted to deliver public services, is there any chance that a similar revolution will happen in Northern Ireland?
A UK government green paper published shortly after last year’s General Election spelled-out the objectives. “We will support the creation and expansion of mutuals, co-operatives, charities and social enterprises, and support these groups to have much greater involvement in the running of public services,” said the paper. “We will give public sector workers a new right to form employee-owned co-operatives and bid to take over the services they deliver. This will empower millions of public sector workers to become their own boss and help them to deliver better services.”
These proposed measures are bold and are much more than rhetoric. Rather, they sit at the heart of the Prime Minister’s ‘Big Society’ initiative – much discussed during the election campaign – in which central government shrinks in size and the not-for-profit sector takes over much of its role.
Such ideas might be expected to fall on fertile ground in Northern Ireland, where charities and social enterprises – or social economy enterprises, as they are generally called here – have traditionally taken on many of the roles that elsewhere are fulfilled by the private sector. However, there are few signs that the Northern Ireland Executive is willing to match the commitment promised by Westminster and Whitehall.
Instead, the not-for-profit sector here is fearful that it will suffer badly from the cuts being implemented in the current round of Budget finalization. With departmental Budgets still being considered, NICVA – the Northern Ireland Council for Voluntary Action – was unwilling to discuss the likely impact on the third sector, but it warned last year of the risk of cuts to the funding of voluntary groups. Exactly what the draft Budget means for individual programmes within specific departments remains unclear – and that may remain the case for several weeks.
While, for example, it is now apparent that Invest NI will suffer a massive cut to its funding and activities, the Department of Enterprise, Trade and Investment has not yet made a decision on its funding for the social economy sector and whether its existing programme for the support of new start social enterprises will continue.
And it appears that there is no over-arching commitment across government in Northern Ireland to increase the contracting-out of public services to the not-for-profit sector, in the same way that there is from the UK Government. Nor are there any proposals being put forward to give public service workers the ‘right to opt out’ and form their own business to run public services themselves – as is the case in England. But, more positively, the Department for Finance and Personnel says that its Central Procurement Directorate is updating its guidance for purchasers to help reduce or eliminate perceived barriers to social enterprises participating in public sector competitions.
This is good news for the Social Economy Network, which represents social enterprises in Northern Ireland, and which has been lobbying for moves of this kind. Audrey Murray is chair of Northern Ireland’s Social Economy Network. She explains: “Some of the largest social enterprises have no problem in meeting the tender requirements. Some of the smaller ones have difficulty.” She hopes that the procurement review will lead to social enterprises having more opportunity to bid for, and win, the smaller contracts that are better suited to their size of operation.
But the Network is keen to emphasise that its members are already very engaged in service delivery. “In Northern Ireland, we do have social economy enterprises delivering public services,” says Murray. “I work for Ledcom, which for the good past number of years has been very effective in economic development in Larne.”
Murray believes that government should do far more to foster the social enterprise sector. “It needs to look at the asset transfer of public buildings that are derelict,” she suggests. “Old police barracks, army barracks and schools. We are not seeking the sale of assets at below value, but a lot of these buildings are in areas of deprivation.” Community groups that took over these sites could help regenerate areas in need and create new businesses, she says.
There are several examples of social enterprises in Northern Ireland being established in deprived areas, to create new commercial hubs that attract new services, businesses and jobs. Notable examples include the Rath Mor Shopping Centre in Derry and a network of community businesses in Irvinestown – in both cases enterprises created after large employers had moved out.
The Bryson Charitable Group probably delivers more public services than any other in Northern Ireland. It currently employs more than 650 staff, with a turnover of over £24m and it is growing at a rate of nearly 20%. It operates a range of services on behalf of the public sector, including kerbside recycling, employment training, domiciliary care and energy efficiency equipment installation. Some 93% of its revenue comes from contracts that are won by competitive tender and 95% of that revenue is spent on service delivery or development.
Bryson chief executive John McMullan says: “The public sector is our major client and social enterprises like Bryson provide high quality cost effective services. We provide a credible alternative to either public or private sector delivery and as government – within the ‘Big Society’ concept – reshapes its role to be a commissioner not the deliverer of direct service, Bryson sees an opportunity for new business models to grow for charities, social enterprises, mutuals and co-operatives.
“Contracts provide us with greater flexibility and clarity, but importantly they require the commissioner to pay the full cost of the service. Disappointingly, not all procurement professionals understand or value social enterprise and as such see us as high risk, but in Bryson we have successfully challenged that misconception.”
However, the development of a larger social economy sector in Northern Ireland is not solely dependent on enterprises winning contracts for public service delivery. Audrey Murray stresses that some members of the Social Economy Network have been in business for more than a century. “The Big Society is the same thing, packaged in a different way. It is people coming together to work for the greater good,” she says. And working towards that goal is seeing new relationships forged by private and third sector partners. “Private enterprise seems to be quicker than the public sector in moving to work with us: they are more receptive to change,” says Murray.
It may well be that it is those partnerships with the private sector that will help grow social enterprise here, rather than any great increase in public sector contracting. The impression remains that while the UK Government is focusing simultaneously on large-scale cuts and wide canvass reforms, in Northern Ireland the attention is concentrated on the vexed question of how to get by on less money. And, for the moment at least, that may mean service cuts, rather than more contracting-out to the third sector.