Transforming community services through mutualism, social enterprise and democracy
A new study for the UK Department for Digital, Culture, Media and Sport (DCMS), examining the role and potential of ‘public service mutuals’ as a viable way of delivering public services, has just been published. In this blog, CUSP researcher Ian Vickers is summarising their main findings.
Blog by IAN VICKERS
Questions around who benefits from economic growth and how have been pushed centre stage by recent government policy actions and counter proposals emerging from the opposition parties. Public debate about the sort of growth (or indeed ‘degrowth’) needed to respond to urgent socio-economic challenges needs to be informed by evidence-based understanding of the potential of alternative forms of enterprise and governance. A report by CUSP researchers at Middlesex University shows how mutualism and organisational democracy supports the creation of ‘good’ or ‘meaningful’ work and how social enterprises can contribute to place-based regeneration and ‘levelling-up’ by empowering the communities they serve and are answerable to.
Mutual social enterprises are not a new phenomenon and have been championed across party political lines over several decades. There are probably more than 400 such organisations across the UK that have been created in a process of ‘spinning-out’ from the public sector, and which take legal forms that enable employee and community ownership and control. Mutuals often serve vulnerable and disadvantaged groups and operate in sectors which are of crucial importance to a better, fairer and more sustainable society and economy, including health, education, youth services, employment/skills, housing, arts and culture.
The report examines the success factors and challenges faced by 12 case study mutuals that were established during the last decade. It draws on the considerable insight and learning provided by interviews and group discussions with over 100 individual participants in the research, including mutuals’ leadership teams, staff and user communities. The research demonstrates the effectiveness of the mutual model and how it has been adapted in diverse contexts to deliver valued public and community services. The findings also reveal a number of key strengths and capabilities of mutuals.
Innovation driven by democratic governance. Desirable change and innovation are often easier and faster in spin-out mutuals compared to prior experiences, and the 12 mutuals had introduced many new ideas and approaches since having left the public sector (as similarly shown by our previous study). The evidence shows how the new democratic cultures are less hierarchical and restrictive, with employees and users more empowered to contribute to decision-making and the co-design of services. Mutuals also have more freedom to access new sources of funding and to engage in collaborations and partnerships with other public, private and civil society organisations, which can also facilitate innovation.
The study sheds particular light on mutuals’ ability to tap into the energy and ideas of their members—staff, user communities and other stakeholders—and to facilitate democratic enfranchisement and input at three main levels of decision-making and accountability:
- Strategy—staff and community voices relating to forward business planning, growth, diversification, and investment in community initiatives and social innovation.
- Policy and procedures—with HR and people management functions having a particular role in realising the new democratic organisational identity, culture and ways of working.
- Operations and day to day service delivery—where delegated decision-making, empowerment of frontline workers, and engagement with service users can enable innovative co-design and co-production of services.
Public and community service integration and development. Mutuals are often well-placed to identify where social value can be added, based on their close understanding of user community needs. Diversification activity often includes the development of new services which are closely related to mutuals’ core services. This can have the added attraction for funding bodies of joining up related services in order to address complex health, welfare and wellbeing issues, while also helping to reduce fragmented provision and ‘policy silos’.
All 12 case study organisations had grown and diversified since their inception, although to varying degrees and in diverse ways. Successful growth beyond start-up is often dependent on being able to deliver both ‘social value’ and ‘value for money’ for public service commissioners, in line with the Public Service (Social Value) Act. In a competitive context, this requires a combination of entrepreneurial acumen and organisational capabilities, having the right people and partnerships in place at the right time, as well as an element of ‘chance’ within the often turbulent policy and market contexts affecting public and community services over the past decade or so.
Mutual social enterprises are creating spaces for inclusive innovation that are less commonly found in the public sector. Mutuals are also a sustainable alternative to the private sector, given their prioritisation of social value above financial return for private gain. They show how the wellbeing of communities can be prioritised by empowering employees and service users, supporting innovation and service integration, and strengthening local economies and social capital. The lessons from their experiences have considerable potential to inform how community-based services in diverse urban and rural contexts across the UK can be revitalised and become more responsive and socially innovative in the face of burgeoning needs.
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The full report can be downloaded via the Government website. The research was conducted as part of a larger project for the Department for Digital, Culture, Media and Sport, who we thank for their support. Social Enterprise UK also conducted a series of State of the Sector surveys in parallel with the case study research.
