A shot across the bows 

More than 100 members of the international social enterprise community have signed an open letter asking Scottish ministers to call off the decision to defund SENScot, one of the two representative bodies for social enterprise in Scotland.

In March, Scotland’s social justice secretary Shona Robison announced that the Scottish government would give core grant funding worth more than £400,000 a year only to Social Enterprise Scotland with the aim of that organisation becoming the sole representative for social enterprises in the country.

In response, SENScot said it expected to close its doors, highlighting that the loss of funding would cause the “loss to the sector of some of our most experienced and passionate people”.

Social Enterprise Scotland emphasised that it wanted to work in partnership with SENScot and others to create the new organisation. 

The open letter, published today, said: “Our sincere hope is that the move towards creating a single enhanced intermediary for social enterprise in Scotland will be immediately suspended pending a rigorous review… Scotland already has a world class infrastructure, which requires to be nurtured and supported, rather than being placced in jeopardy at this crucial time.”

The letter has been signed by 126 people from 28 countries. They are principally drawn from the academic community and they include James Austin, the co-founder of the Social Enterprise Initiative at Harvard Business School, Riccardo Bodini, the director of the European Institute for Research on Cooperatives and Social Enterprises in Italy, Kerryn Krige of South Africa’s University of Pretoria, and David Upton, CEO of Common Good Solutions, the Canadian host of the Social Enterprise World Forum 2021. 

Professor Michael Roy of Glasgow Caledonian University’s Yunus Centre for Social Business and Health (pictured), organised the letter. He said: “SENScot, which acts as an important support body for social enterprise, is a genuine Scottish success story. Their work over the last 20 years has helped place Scotland at the forefront of the social enterprise movement internationally.”

He said: “Not only is the decision based on the false premise that the diverse social enterprise sector in Scotland has been crying out for a single support body, but the timing really couldn’t be any worse.” He added that the impacts of the pandemic and the cost of living crisis meant support for grassroots social enterprises was needed more than ever.

The work of SENScot was admired around the world, Roy said. “My colleagues around the world were especially shocked at the decision, given Scotland’s hard-won reputation as a leader internationally on social enterprise. I have colleagues in Canada that teach about SENScot’s approach in their university degree programmes. I’ve had emails of support from senior professors in England and across Europe who have worked with SENScot over many years on different projects. They consider SENScot’s approach and leadership to be an example of international best practice.”

Responding to the open letter, Robison said: “We set out our plan last year to fund a single intermediary body with responsibility for representing and advocating for the social enterprise sector.

“There was an open and transparent selection process by an Independent Assessment Panel but of course we can understand there will be disappointment from the candidate who was not appointed.

“The decision has been well communicated and the sector has also been clear that it wants transformational change. 

“I want the diverse voices of the sector to influence the future direction and set the priorities for the new single body and for it to become fully representative of, and responsive to, the social enterprise sector.

“The Scottish Government is working closely with both current organisations to ensure the successful development of a single organisation.”

An open letter to Shona Robison MSP, Cabinet Secretary for Social Justice, Housing and Local Government, Scottish Government

We are members of the international social enterprise community and wish to express our considerable concern at the decision by Scottish Ministers to defund SENScot.

Scotland has an enviable worldwide reputation for the quality of its infrastructure and support for social enterprise, and for the quality of its leadership in these respects. Many countries around the world such as Canada, New Zealand, and, most recently, Australia, have looked to Scotland and sought inspiration from “the Scottish model” to construct their own policies in support of social enterprise. This includes networks inspired by SENScot’s approach. The quality of Scotland’s infrastructure has been recognised time and time again by transnational actors such as the European Union, the Organisation for Economic Co-operation and Development (OECD), and United Nations agencies such as the International Labour Organisation (ILO). Scotland’s hard-won reputation is due, in no small part, to SENScot’s work over many years to ensure that Scotland resists (at least somewhat) the dominant Anglo-American model of social enterprise, to remain closer to a European social economy tradition rooted in social democratic ideals. This set of values underpins a diverse network of grassroots-level organisations, and SENScot has had a long history of vital work to ensure that their voices are heard. The Voluntary Code for Social Enterprise, co-developed by the sector in Scotland under SENScot’s leadership, epitomises this distinct set of values; this is not universally found, and certainly should not be taken for granted.

Moreover, we find the timing of the recent defunding decision puzzling, to say the least. Just when countries around the world are relying on their networks of grassroots community-led civil society organisations such as social enterprises to help rebuild post-Covid, Scotland is putting their own Covid recovery needlessly under threat by jeopardising vital support networks that are uniquely both thematic and geographic in nature, which have helped co-ordinate much of the vital work throughout the present crisis. We understand that considerable resources and energies have been spent to date in choosing the favoured organisation on which to build the new “enhanced” single intermediary, and unfortunately such work has encouraged a culture of competition rather than co-operation between the intermediaries along the way. The significant work now required to unravel and “tidy up” an infrastructure that has developed and grown organically to suit the specific needs of Scotland would surely be far better devoted to rebuilding post-Covid, supporting the sector to address the social inequalities that recent crises have so vividly and cruelly exposed.

Rather than being “representative of, and responsive to, the changing needs of the diverse range of social enterprises and social entrepreneurs across the country”, this decision is far more likely to have the opposite effect. The equality implications of this decision are profound, and yet we were astonished to hear that an Equalities Impact Assessment on such implications had not been undertaken. Research shows, for instance, that women are far more likely to set up and lead small community-led social enterprises of the type championed by SENScot over the last two decades. This is presumably why there are now so many female leaders of social enterprises in Scotland. The prospect of the all-female team at SENScot being made redundant and their inspirational leadership potentially being lost to the social enterprise movement has angered many of us.

Finally, at a time when scientific expertise has proven to be invaluable across the world in shaping policy responses to the Covid crisis, we were especially dismayed to hear that Scottish Ministers did not draw upon the expertise of its own world-leading community of social enterprise researchers – particularly at the Yunus Centre for Social Business and Health at Glasgow Caledonian University – for advice and independent counsel related to this decision. We understand that fieldwork undertaken by them has found that a single intermediary is not considered necessary, nor wanted, by the social enterprise sector in Scotland. Quite simply, according to our colleagues there, no “long-standing and repeated calls” have been made for a single intermediary body for social enterprise in Scotland, as the Cabinet Secretary intimated to the Scottish Parliament recently.

Our sincere hope, therefore, is that the move towards creating a single “enhanced” intermediary for social enterprise in Scotland will be immediately suspended pending a rigorous review that draws on sound scientific evidence on the implications. Scotland already has a world class infrastructure, which requires to be nurtured and supported, rather than being placed in jeopardy at this crucial time. We look forward to the news that Scotland is keen to regain the trust of the international community on matters relating to social enterprise support and look forward to assisting you in those efforts.