How housing associations can support communities through social enterprise
Owen Jarvis, Guardian Professional
Joblessness on many social housing estates tops 50% but at the same time, housing associations contract for millions of pounds worth of services each year. Social enterprise can deliver both services and social impact. So, put this all together, and across the country you could have a social businesses creating jobs for local people, delivering contracts for housing associations and reinvesting the profits in communities. Surely it’s a no-brainer.
However, for many senior housing staff at housing associations responsible for these contracts, this can feel like a huge leap of faith. Many ask, "how does it work, what are the risks, how do tendering rules apply, how do you find a good social enterprise, why don’t we just do it all ourselves?"
The launch of a social enterprise designed for the housing sector, Aspiring Community Works (ACW), last week brought these questions to the fore, and has hopefully provided a way forward.
ACW is a social enterprise launched by our charity, Aspire Foundation, which has specialised in developing social enterprises in the social housing sector over the past six years. We have been looking out for a sustainable model for some time and we are extremely excited by ACW which works in the following way.
The social enterprise is a partnership between Aspire and Tower Hamlets Community Housing (THCH). ACW is completely independent of the housing association, with its own staff and board. The housing association identifies bundles of small contracts that are under OJEU restrictions and that are available, for straightforward services such as gardening, cleaning, bulk waste removal. These are then contracted with the social enterprise.
To start with, these contracts are set up and managed by Aspire’s experienced business team. The business recruits and trains local people who are unemployed and over time they gain professional qualifications and apprenticeships, with many moving into management and board positions with ACW or other local companies. Should the local community be inspired to seek complete ownership of the organisation, Aspire will after 3 years train and support the community to raise the finance and buy the business.
ACW options for growth and expansion are deliberately open. The business can grow and expand over time, winning further contracts with THCH, or new ones with other housing associations, businesses and local public sector organisations. This also means new businesses can be launched pretty much from scratch through contracts, and adapted to most locations. This makes it sustainable, adaptable and replicable.
If you are a housing association looking to contract with a social enterprise, there are some things to bear in mind:
• Keep it simple: ACW has started with contracts offering established formulas such as grounds and property maintenance. These are ideal for inexperienced trainee teams supervised by experienced trades people, and offer skills and training opportunities.
• Work together: developing a longer-term vision with shared aims is crucial. Housing associations can help in simple ways by paying invoices on 14-28 day terms to avoid cashflow issues, offering office and storage space and providing active promotion and marketing. They can also help by providing a "champion" as one point of contact to invest time in nurturing the partnership.
• Manage risks: remember, the risk of contracting with a social enterprise partner is the same as with any commercial company. The usual safety nets can be built in – for example, ACW’s contracts are for three years, with an annual review. If there are incidents of poor performance that cannot be turned around, the contract can be terminated at that point. The upside of contracting externally is that the financial risk is carried by the social enterprise.
Social enterprise partners look for strong business and industry experience matched with a real passion for developing people. A track record of social enterprise is key, plus the ability to develop solid operational systems. The enterprise will bring fresh skills, new approaches, and an ability to respond nimbly to tenant requirements.
Owen Jarvis is the director of Aspire Foundation