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December 3, 2019

No profit from public service

The big issue that seems to have momentarily diverted the general election spotlight away from ‘getting it done’ is whether the NHS market will be opened up for corporate interests to feast upon (more than they do at present).  And when President Trump declares America wouldn’t be interested even if served up on a ‘ silver platter,’ it’s probably time to worry. But outsourcing public services doesn’t necessarily have to line the pockets of shareholders. Procurement officers might like to take note of a major new survey of public opinion which argues strongly that public contracts should go to social enterprise.

Jamie Hailstane, New Start Magazine

Nine out of ten people would prefer public services were outsourced to social enterprises rather than the private sector, according to new research.

A survey by the Chartered Institute of Public Finance and Accountancy (CIPFA) and consultancy group E3M found most people consider social enterprises to be more suitable public service providers on the grounds of value for money, expertise, trust and lower levels of risk.

The YouGov survey of 2,000 adults showed nearly half of respondents that public bodies should not outsource any services at all.

Although 84% of respondents said they were aware that some services are contracted to other businesses.

Just one in ten people thought private enterprises were suitable health and social care providers, compared with more than one third (36%) who were comfortable with social enterprises taking this role.

For physical services such as waste and recycling, social enterprises were regarded as more suitable than private enterprises – 29% versus 23%.

When asked to choose a preferred provider between private enterprises and social enterprises, 59% of respondents said they preferred social enterprises, while 9% chose private enterprise and 32% did not express a preference.

Of those who expressed a preference, nine out of 10 preferred social enterprises.

A survey of public finance professionals for the report found 84% said social enterprises have been very or quite successful in delivering these services.

And six in ten said they thought social enterprises would play a greater role in public service provision in future.

Only 3% believed social enterprises had been unsuccessful or very unsuccessful.

‘The high levels of public trust in social enterprises revealed in this study demonstrates the viability of social enterprise as an option for delivering public services,’ said CIPFA chief executive, Rob Whiteman.

‘We would encourage local authorities to look beyond conventional private sector partnerships, and explore how social enterprises in their areas could support greater citizen engagement with services and investments in place.’

Jonathan Bland, managing director, social business international and coordinator of E3M, added: ‘Local authorities need to take this research seriously. The mood has changed: the public wants a different model of outsourcing that they trust, one which uses profits to benefit society rather than building shareholder value.’

The full report – A shifting landscape: attitudes to social enterprise service delivery – is available to read here.