Doubts raised about long term viability of social enterprises in NHS

Doubts raised about long term viability of social enterprises in NHS



Caroline White  




Doubts about the long term viability of social enterprise groups within the NHS are raised by new research published today.


The research from the Department of Social Policy University of Durham, which was commissioned by UNISON, is based on interviews with healthcare professionals, trades union representatives, national policy advisors, voluntary organisations, and the Department of Health, among others.


Social enterprises run along business lines, but any profits they make are reinvested bake into the community or into developing the services offered.


The government is keen to boost their development, especially in primary care, in a bid to increase the diversity of service provision and promote greater local accountability and public involvement in service design, particularly in areas of social deprivation.


Earlier this month, the Department of Health announced £9 million of funds for social enterprises delivering health and social care services for 2007/8, out of a total of £73 million over the next four years.


Today’s report indicates that while respondents recognised the potential for innovation and more responsive services, there are considerable anxieties about the integration of social enterprises into the ‘NHS family’ and their sustainability.


Interviewees feared that small social enterprises could lose out in an increasingly competitive primary care market-place, as the evidence points to commissioners opting for larger private sector outfits, on the grounds that these were more likely to be financially stable.


The complexity of European Union procurement regulations could also disadvantage smaller organisations wanting to set up social enterprises.


And local accountability arrangements may actually boost costs, making social enterprises a less attractive option for cash strapped PCTs.


Speaking at the launch of the report earlier today, Dave Prentice, Unison’s general secretary said that sustainability was always going to be problematic.


‘A newly formed enterprise will have to deal with the finance, management, and competitive tendering process, making it ripe for takeover by private companies and big business.’


Social enterprises had existed before the establishment of the NHS and had spawned health inequalities. It was important to learn from history, he said.

‘There is concern that these are seen as the only game in town.’


Fears were also voiced about the ability of large, reconfigured PCTs to coordinate many different types of service provider and priorities within their patch, and the difficulties of information transfer and good practice sharing in a commercially competitive environment.


Other respondents feared that social enterprises were merely smoothing the way for the creeping privatisation of the NHS, and the fragmentation of care, with a loss of public sector ethos in favour of commercially driven objectives.


And some argued that these organisations were generating an increasing emphasis on meeting contractual arrangements rather than enhancing public involvement.


And there were concerns that the favourable staff terms and conditions and pension arrangements of the NHS were not being transferred to these new organisations


‘In a period of uncertainty and change in the NHS, it remains to be seen how far expectations of social enterprise will be borne out in practice,’ caution the authors.


But they add that social enterprises are high risk projects, with an enormous impact on ‘the consistency of purpose, sustainability, and appropriate public accountability and regulation’ of the NHS.


And referring to the government’s apparent lack of rigorous monitoring of social enterprises, they conclude: ‘It would seem only prudent that rapid developments in such a fast moving environment are kept under careful and constant review.’


Social enterprises and the NHS. Changing patterns of ownership and accountability.