What part should social enterprise play in running Croydon?

By - Wednesday 9th March, 2016

Sean Creighton sets out to learn some lessons in management from history

Transferred to social enterprise: photo by Stanley Halls, used with permission.

At the end of March last year the Octavo Partnership was started as a mutual partnership between Croydon council and the Headteachers Association to deliver the former in-house education support services to schools. This is one social enterprise solution to the future delivery of council services in a period of continuing cuts.

In May 2015 Croydon Council was awarded Social Enterprise status by Social Enterprise UK, the first London borough to gain it. At the time it was thought that there were 120 registered social enterprise businesses in Croydon trading with a social or environmental purpose, including Beanies café and crèche, MyOutSpace, Caysh, Mum’s the Chef, and PJ’s community services. Hundreds more operate in the wider voluntary, community and social enterprise sector. There are many people exploring setting up new ones. The council convenes the Social Enterprise Network and has a tool kit of advice available to it.

Croydon TUC has backed social enterprise in its assessment of the council’s local economy Growth Plan. Not everyone in the Labour Party is happy with this approach and a few months ago David White, the secretary of Croydon Central Labour Party, set out his concerns on social media.

The role of social enterprise has been a long standing debate which needs to be seen in its historical context. It has long roots in Britain in its various forms such as co-operatives, building societies and friendly societies, sparked by the neglectfulness of capitalism and the failure of the state to meet working people’s needs, whether in work, unemployment and sickness.

Following the decline of the Chartist movement for the vote, thousands of member controlled loan societies were established to provide savings and credit services, but were unable to develop into large scale providers of financial services. In the late nineteenth century the Labour movement forged an agenda for local government which envisaged an expansion of local services, and the replacement of contracts with private firms by a direct labour force. The labour movement sought co-operative solutions to failing firms, especially in the building trade.

The introduction of National Insurance in 1911 brought these mutual friendly societies into partnership with central government, an arrangement which ended with the new welfare provisions introduced by the Labour government of 1945 to 1951.

Neighbourhood management models met with little success in London

By the 1970s the increasingly hierarchical departmental structures in larger and larger local authorities were seen by many as being counterproductive to meeting the needs of local residents, and as more concerned with empire building. In response, a model of neighbourhood management emerged, based on breaking up the departments into multi-service neighbourhood based teams accountable to local committees of councillors and residents supported by small specialist central support units.

Within London the concept met with little success in Wandsworth and Lambeth. The few experiments in full scale neighbourhood devolution that were tried in the 1980s, such as that in Walsall in the midlands, were easily overturned when political control changed, while Islington undermined the case by building its neighbourhood organisation onto the departmental structure. Then when Wandsworth in the early 80s faced with the prospect of having to make cuts if it regained power, there was debate in the Labour Party about a new approach to running the council. Central to the ideas were workers’ co-operatives and social enterprises.

Cuts provide an opportunity for creative thinking

Starting under Croydon North MP Steve Reed’s leadership, Lambeth has experimented with the co-operative council model. But the he way it has gone about this has seriously damaged the concept. Its planned alliance with GLL to turn some libraries into healthy living centres (gyms), for example, exposes one of the problems of social enterprise organisations which are not based in the local community and do not consult with local communities.

Here in Croydon we have seen the transfer of Stanley Halls to a social enterprise. But a heavy price has been paid: the replacement of the chair and vice-chair by council cabinet members.

Like all local authorities Croydon is being forced to make year-on-year cuts. This challenge provides opportunities for creative thinking to find ways to minimise the adverse effects of reduced funding. These may include contracts with social enterprises, as opposed to shareholder profit-making private firms. But if such solutions are adopted, a contractual condition must be a proper programme of engagement with local communities and the involvement of representatives of local communities in governance .

Sean Creighton

Sean Creighton

A former employee of and freelance project worker with community and voluntary organisations, Sean is active with Croydon Assembly and with the Planning and Transport Committee of the Love Norbury group of residents associations. He is Chair of the Norbury Community Land Trust. He is a historian of Croydon and South-West London, British black society, social action and the labour movement. He coordinates the Samuel Coleridge-Taylor and Croydon Radical History networks. He runs blog sites covering Croydon, Norbury and history events, issues and news. He runs a small scale publishing imprint called History & Social Action Publications. He gives talks on a range of history topics and leads history walks.

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