Labour promises contracts open to charities and social enterprises only

Labour promises contracts open to charities and social enterprises only
Civil Society Finance, By David Ainsworth


A Labour government would offer contracts which only not-for-profit organisations can bid for, shadow social enterprise minister Chi Onwurah will announce today.


In a speech at an event on the future of social enterprise in public service delivery in London today, Onwurah, the MP for Newcastle upon Tyne Central (pictured), will promise that a Labour government would use new, more flexible EU procurement rules to support the sector.


Labour plans to allow government departments and local authorities to allocate some three-year contracts exclusively for organisations which exist “in the pursuit of a public service mission”, she will say.


“Public procurement remains a significant and growing concern for many social enterprises who feel locked out,” Onwurah will say in her speech. “Many public service sectors are now dominated by the same big companies.  We want to make it easier for social enterprises to win government contracts.


“And to help drive that, a Labour government in 2015 will enable departments and local authorities to offer some contracts exclusively for social enterprises.


“Rooted in their communities, social enterprises can identify new, effective and enterprising ways of delivering public services.


“We want to draw on the innovation of social enterprises in public services.”


Celia Richardson, director of the Social Economy Alliance, a group of social enterprise umbrella bodies, said she was “delighted” by the proposal.


“No-one wants to see £10bn a year in taxpayers’ money going to just 20 private businesses,” she said. “This is not what a balanced economy needs and not what public service users need.


“We are calling for the next government to use its massive buying power in smart ways. Public spending shouldn’t result in oligopolies where only a handful of giant businesses stand a chance of winning contracts.”