Government failing to support social enterprise, says leading Social Bank

Government failing to support social enterprise, says leading Social Bank





The Government’s technical business support for the UK’s social economy lacks focus, is too basic and fails to understand the needs of the sector it’s supposed to help, according to a report released today by the UK’s leading social bank.


Triodos Bank, who commissioned Cardiff University to research ‘Turning Big Ideas into Viable Social Enterprise’, believe Government reorganisation of the bodies responsible for the social enterprise sector could represent a huge missed opportunity, at a time when social enterprises are struggling to find the support they need to grow.


‘Up to now, the Government has championed this crucial and growing part of the UK economy,’ says Triodos Bank Business Banking Manager, Gavin Smith. ‘And rightly so – there’s little of British life and society that doesn’t include some form of social enterprise activity. But the findings of this report show that too often social enterprises that bring real benefits to people and the environment are receiving short-term, inappropriate technical business support from people who don’t appear to understand their work.’


The research suggests that social businesses are often confused about what support is available. Indeed, most are not accessing conventional support networks at all, but relying on their own informal networks instead.  While Government policy and strategy in the UK highlights substantial progress in developing support for the sector, the reality on the ground is less convincing. ‘Given evidence that the Government is reorganising how it funds these business support providers, the results are alarming,’ says Gavin Smith. ‘Right now, these organisations need more help, not less.’


While the Government acknowledges that social enterprises need support, it claims that its key vehicle for business support, Business Link, is already delivering. The report’s authors disagree. ‘Business Link is target-driven and fundamentally different to the social enterprises it serves,’ says Frances Hines, Research Manager at Cardiff University. ‘We found that business support providers tend to use a ‘one size fits all’ approach which simply doesn’t work for a diverse sector driven by long-term social, as well as financial returns. The Government has championed a small number of apparently successful social enterprises where longer-term support has been provided, but our research showed that these are very much the exception to the rule.’


The findings of the report come with news that the Government is reorganising its support structure with wide-ranging implications for the sector.  According to Lucy Findlay, the Chief Executive of RISE, the widely respected champion of social enterprise in the South West,  ‘Triodos Bank’s research provides compelling evidence that social enterprises need more of the right kind of support. To do this organisations like RISE must be strengthened too.  Any changes that are put forward must take into account the unique needs of the social enterprise sector and help them to make a real difference to the communities that they serve.’


The report highlights a number of issues, including surprising evidence that many social enterprises are not aware that they can take advantage of pro-bono support.  While the report’s authors found that it can be useful in the right circumstances, pro bono support is unlikely to provide the long-term solution to social businesses problems. The report identifies a number of areas where support is needed, including business management skills, assistance with legal matters, personnel issues and accountancy and auditing.


While Triodos Bank acknowledges that there have been a plethora of reports around the sector, few appear to reach the desks of businesses in the social enterprise sector.  


Click here to download the full report, or here for an executive summary.


‘Turning Big Ideas into Viable Social Enterprise’ was researched and written by BRASS, Cardiff University’s ESRC Centre for Business Relationships Accountability, Sustainability and Society.