The Unite leadership doesn’t get social enterprise. They’ve confused community run businesses which exist solely in order to tackle head on the most difficult social and environmental challenges, with the type of private sector organisations which make money at the expense of their staff, their quality and their customers. Not an easy mistake to make, but one they’ve made nonetheless. In a letter sent by their Joint Gen Sec Tony Woodley to myself and Acevo CEO Stephen Bubb a couple of weeks ago, he argued that social enterprises should not be allowed to deliver services on behalf of the state because we engage in a ‘race to the bottom’ on wages. Apparently we experience a ‘high staff turnover’ and our ‘funding’ is ‘too short term’ to be able to provide sufficient stability of service. He’s wrong.
There are problems and challenges associated with commissioning the third sector to deliver public services: big challenges, ones without straightforward answers, no-one is denying this. But fundamentally the unions and the social enterprise movement share similar core values, and we should be working together to create outstanding public services. My full response was published by the Guardian Online yesterday: it’s below:
"The union is right to campaign about the privatisation of the NHS, but its vitriol against social enterprise is misdirected
It is odd that social enterprises and charities have fallen out with trade unions, or, to be precise, one trade union: Unite. The third sector has a great deal in common with the union movement. We care about people — those we serve and those we employ. Many social enterprises exist primarily to provide good jobs for those who typically face major barriers to entering any kind of employment. Yet, here we are at loggerheads over our role in the NHS.
The extent of Unite's opposition has become apparent through its recent Health B4 Profit campaign. Unite produced a pamphlet damning the employment practices of social enterprises, our position on unions, and even our intentions — all as it perceives them. We countered with hard evidence to the contrary, such as the success of employee ownership models including GLL, where workers own the company and sit on the board, and we have pointed out that many social enterprises are already providing outstanding public health services in partnership with the NHS, using innovative new structures to reach elements of the community that have been neglected.
We thought Unite's position was the result of a communication breakdown, that facts and figures together with statements of support and an offer to discuss things would put this right.
So imagine our surprise when Unite's joint general secretary Tony Woodley responded with one of the most unguarded letters I have seen in my 18 years of being a CEO. He told us that social enterprise is "in a race to the bottom" in its standards of employment, that we experience a "high staff turnover" and that we "cannot provide the stability needed for health provision due to the short-term nature of our funding".
I believe there will always be a role for unions. I was a full-time union official for five years. I know how important unions are in fighting for decent healthcare, safe working conditions, fair payment terms and many things besides. In fact, it's because of this that I know we are on the same side.
Here's why Unite's position needs to change.
In truth, both the third sector and unions are united in our rejection of the use of public services for private profit. Social enterprises make money, but the money they make is directly reinvested back into the organisation, addressing increased social need. That is a crucial and incontrovertible difference between the third sector and the private sector. Which, in turn, makes Unite's attempt to lump us together as crude and inaccurate.
The third sector doesn't want to see the NHS become fragmented, nor do we want the private sector to start delivering frontline services, and the last thing we want is a "race to the bottom" on standards, salaries or anything else.
What we are working hard to achieve is a healthcare system that responds to the fact that outstanding public services don't necessarily need to be directly controlled by the state. A system that understands that public interest and public involvement can be direct and bottom up; that people can take ownership of their services and be in charge of their destiny. Social enterprise can and is a vehicle to achieve a renewed public service. It's exciting and, when it works, the results can be revolutionary.
There is still plenty to debate over how we best involve the third sector in public service delivery, but our motivation and our fitness to serve is beyond question. What we need to be successful is a little help from our friends. But with friends like Unite, who needs enemies?"