Public Services (Social Enterprise and Social Value) Bill

Debate between Ben Gummer and Nick Hurd

Friday 19th November 2010 Commons Chamber

[Mr Hurd]

I would be delighted to arrange that meeting. Aileen McDonald sounds wonderfully inspiring, and if she can help us to open doors to more intelligent commissioning, we should be all ears.

[Ben Gummer]

The Minister has provided some good examples of what he called intelligent commissioning, and I provided an example of a bad commissioning decision. Would he characterise that as unintelligent commissioning? If so, is that not precisely what the Bill is trying to correct?

[Mr Hurd]

My hon. Friend was good enough to introduce diverse representation from Ipswich, and the anger about the decision was palpable. It might be risky to comment from afar without knowing the details, but what struck me about the commissioning decision was that if 65% of the demand for the contract was based in Ipswich, it seems odd that there was no consultation. The process effectively removed an organisation that was clearly successful in delivering what the contract intended to deliver and had a massive social impact and value in that community. The decision seemed to be taken a long way away from the people who needed the help, and that is a problem.

The spirit of the Bill builds on the Government’s commitment to economic growth and the promotion of entrepreneurship. It is appropriate that it should come to the House in global entrepreneurship week, and the day after social enterprise day, which many hon. Members celebrated. We should not forget that social enterprises are, first and foremost, businesses that contribute £24 billion—that seems to be the official figure—to the UK economy and employ more than 800,000 people. As the hon. Member for Hemsworth powerfully said, they make an enormous contribution by creating and stimulating markets, bringing wealth into struggling communities, creating jobs, supporting disadvantaged people into employment, pioneering innovative products in ethical markets, and attracting new people into business, particularly the young, women and people from minority ethnic communities.

I was struck by a recent comment from Steve Jobs, who leads Apple, a brand that is always associated with innovation. He said that innovation is the difference between leaders and followers. The country desperately needs leadership and people who are capable of pointing to better ways of doing things, and it is in the social entrepreneur community that there are genuine leaders.

I was in Sheffield last week visiting a social enterprise, Zest, which has incredible leadership. It demonstrates how youth services can be run in such a way that young people turn up. It shows how libraries can be run in a way that involves the community, and how to engage with the public on public health issues. I sat at a table with people from the local PCT and the local council, hoping that they were learning and reflecting on how much money might have been wasted over the years. Organisations such as Zest are showing the way forward and opening minds to doing things better.

The point was well made, not least by my hon. Friend the Member for Congleton and, I think, the right hon. Member for Salford and Eccles, that this is not just about social enterprise. Social value is not just about an organisational form called social enterprise, however broad that form might be. I hope that the Bill will also be a catalyst to encourage traditional businesses to speak up more about what they are doing in the community. We all know from our constituencies that many businesses, often family owned businesses with a strong sense of community, do a huge amount, but there is now a challenge, in the context of the big society, to everyone in traditional businesses to think harder about their social responsibility and their commitment to the community. The Government will be saying more about that shortly.

I have set out why we support many of the principles and objectives of the Bill, but we are legislators and we have a duty to ensure that the legislation that passes through the House is robust, is needed and adds value. I suspect that that is one of the themes that we can anticipate hearing from the most distinguished Friday face in the Chamber, my hon. Friend the Member for Christchurch (Mr Chope).

I want to get into the detail of the Bill. The primary measure that the Government support is clause 3, which deals with contracts of contracting authorities. As my hon. Friend the Member for Warwick and Leamington has already outlined, clause 3 requires contracting authorities to consider how they might promote or improve economic, social or environmental well-being through a contract. In policy terms, we often refer to this well-being as “value”, because commissioners who already voluntarily follow this approach tend to attribute a quantifiable worth to it and consider it as part of their wider evaluation of bids to deliver public services. The title of the Bill reflects this commonly used terminology.

The Government are supporting this measure for two main reasons. First, and most importantly, the Bill sends an unequivocal message to those spending public money that it is vital that they maximise the value achieved by every penny. This is particularly important in the current public spending context. We acknowledge that many of the best commissioners already recognise the importance of this and are exemplars to the public sector. Yesterday, I was privileged to sit in on the first meeting between the London Probation Trust and two social enterprises. The conversation covered how the trust could work differently to commission social enterprises to set up community enterprises such as cafés, garden centres and small garages to employ offenders in the community. This is an example of a commissioner thinking outside the traditional box, and that is the kind of progressive commissioning that we want to encourage.