The significance of social enterprises in the reform of the British welfare state

Abstract

Increasingly, the United Kingdom Government is looking towards the social economy to deliver welfare services. The social economy, and specifically social enterprises, are envisaged by New Labour as having the ability to train and employ those disadvantaged in the labour market; engage individuals and communities in service provision and urban renewal; and, provide a model for future forms of welfare service provision. This research investigates the links between the social enterprise and the welfare reforms initiated by New Labour. In addition, the research considers the implications of an expanded role for social enterprises in welfare from the perspective of social enterprise practitioners. Using a grounded theory research design, and qualitative research methodologies, those running social enterprises in the cities of London and Bristol were interviewed (during the summer of 2001). This data, alongside policy documents, ministerial speeches, newspaper articles, think tank publications, and interviews with policy-makers and advocates for the social enterprise sector, provide the evidence presented here.
The research develops a definition of the social enterprise as an organisation that uses a commercial venture as a tool to achieve social change. It is shown that the term 'social enterprise' refers to a diverse range of organisations that differ in legal and organisational structure and social mission, but which are linked by the common purpose of service delivery. The research reveals a subtle but important difference between social enterprise activity, and social enterprise as a business model. In spite of their diversity, it is demonstrated that a typology of social enterprises can be constructed by using the attributes identified by those running such organisations. This typology takes into account a diverse range of attributes that coalesce to form this hybrid social institution, instead of considering their organisational structure or social mission as defining features, as has been the case in the past.
Using discourse analysis, social enterprises are shown to be significant within welfare reform because they embody the attributes that advocates for reform wish to promote. Social enterprises are shown to embody the postmodern attributes of 'empowerment' and tailored localised service provision, alongside the politically attractive attributes of'enterprise', 'effectiveness', and 'efficiency'. These attributes offer 'challenges' to existing forms of public and third sector welfare provision. Through these challenges, the discourse of social enterprise is instrumental in current changes in welfare, not only in changing the practices of service delivery, but more significantly, in changing the culture and the way in which 'solutions' in welfare are sought.
The thesis demonstrates how the notion of social enterprise is intertwined with broader academic debates concerning the scale and scope of the emerging postmodern welfare state, and the social enterprise is shown to be emblematic of those changes in welfare at a theoretical level. At a practical level, the social enterprise appears to be unlikely to have significant impact on the mainstay of the welfare state. However, it is suggested here that policy-makers need to take greater consideration of the 'appropriateness' of applying the social enterprise model in welfare than is the case at present.

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