Main Menu
- Other links
- Sections
- About
This snapshot taken on 26/07/2008, shows web content selected for preservation by The National Archives. External links, forms and search boxes may not work in archived websites.
The Rt. Hon. John Hutton MP, Secretary of State for Business, Enterprise & Regulatory Reform
ACEVO's Spring Conference, Royal Bank of Scotland, Bishopsgate, London, 13 March 2008
Good morning ladies and gentlemen. Thank you for your kind invitation to speak today.
ACEVO is committed to the development of a modern, enterprising third sector. So are we. Fostering such a strong spirit of enterprise in every sector of our economy and every community is, I believe, essential to the UK’s future success.
As we’re all well aware, this is an age of rapid global change; of intense economic competition and increasing threats to our environment.
Spirit of enterprise is a key priority for Government; same spirit in private and third sector.
Against this background, if how we continue to ensure economic growth and make social progress is the question, then Government helping to build an environment where ambitious, enterprising people and dynamic organisations can thrive must be the answer.
My Department was created to renew and strengthen this focus on business growth and enterprise; to help inspire and enable more of our people to act on their dreams as economic and social entrepreneurs; and deliver the bold solutions we need in our public, private and third sectors to prosper.
In the last decade, our country’s entrepreneurial drive, I believe, has grown significantly stronger – with record numbers of new businesses created and higher levels of business survival rates than was the case a decade or so ago.
The World Bank ranks us as second in Europe, and in the global top ten in terms of ease of doing business.
More people and organisations are contributing to our economy and society, many as part of one of the most successful and vibrant Third Sectors that can be found anywhere in the world.
Across the country, voluntary organisations, community groups and social enterprises are creating new jobs, driving prosperity and regenerating communities.
I see that in my constituency, along with every other MP.
Unlocking the skills and potential of people often underrepresented in business or excluded from employment; developing leading-edge solutions for social and environmental issues and increasing competition, choice and value for money in public services and innovation in business.
These are all areas where we see the Third sector now making an important contribution.
But today’s achievements can’t be the sum of our ambitions for tomorrow. And neither can we afford to be complacent about the future.
To succeed, and harness more of the unfulfilled talent that’s out there, the scale of our ambition must be to become the world’s most enterprising economy within the next decade.
Yesterday, we set this ambition for the UK and launched a new Strategy for Enterprise to help us remove the barriers – some of these cultural, economic, regulatory and personal - which hold people back from achieving this goal.
Today, I want to talk about the vital role the Third Sector can play in helping us achieve those ambitions, and overcome the challenges we face - so more of our people and communities can succeed in this global age.
I start from the proposition that Government on its own can’t create dynamic third-sector organisations. That’s down to the drive, passion and acumen of the people, like you, that work within it.
But as our 2007 Third Sector Review stated, the Government’s vision for the next decade is to build a vibrant environment based on a genuine partnership between all three sectors so your organisations have the best potential to succeed.
And over the last decade you have flourished, growing both in size and importance to our economy and society. As, more people have looked to your sector to help give them a voice on issues and decisions that impact their lives. And Government, in turn for its part, has recognised you as a driver of change and innovation; social cohesion; opportunity and prosperity.
Across Whitehall, we’ve worked to help create the conditions to support this success and develop a stronger relationship with you based on shared respect, greater understanding and obviously your need for continued independence.
A snapshot of the action Government’s already taken includes developing a more robust evidence base around the results of the work you do through the first Third Sector Research Centre; promoting and monitoring three year funding across Government to ensure it’s the norm rather than the exception; increasing investment to build capacity with over £80 million to Capacitybuilders; and deregulation measures through the recent Charities Act 2006.
We’ve boosted support to small community organisations, with access to a targeted £130 million grass roots grants scheme and a £30 million community assets fund. And in the public sector and beyond, we’re raising awareness of the potential role of the third sector through skills development, training and learning.
Through Government funding, the youth volunteering charity, V will aim to create 500,000 new volunteering opportunities for young people over the next three years.
And I think that’s an absolutely fantastic project.
But this is just a beginning. And today, I want to focus on two of areas of work involving my Department, where I believe the creativity and passion of the Third Sector can make a real and lasting difference to our society and economy – social enterprise and public service reform.
If we’re to overtake the world’s most enterprising nations; then enterprise just can’t be an attitude or activity for the few. It must be a driving force that runs through every section of our society, region of our country and sector of our economy.
But despite recent progress, certain enterprise gaps are still visible in the UK – where two men start up a business to every one woman; Black Africans and Bangladeshis have lower self-employment rates than other ethnic groups; and our northern regions still lag significantly behind London and the South East.
Since the 19th century, social enterprise has helped to inspire these and other underrepresented groups to progress and meet powerful social goals through business.
And, it could still – over 150 years later - hold the key to meeting many of our enterprise ambitions.
For example, Global Entrepreneurship Monitor found that women in some regions are more attracted to starting a social enterprise, and that nationally, the gap between male and female ownership in this area is only 0.5% compared to nearly 5% in mainstream business.
Social Enterprise is also tackling some of our most difficult social and environmental problems through business success, helping transform the design and delivery of public services and pioneering the adoption of ethical business practices.
Its roots run deep in our society.
We estimate around 55,000 social enterprises operate in a wide range of industries and sectors today across the UK. Together, they generate a collective turnover now in excess of £27 billion a year, contribute £8.4 billion to the UK economy and represent 5% of all UK businesses with employees.
Our new Enterprise Strategy, which we published with the Budget yesterday, aims to build on this success, and the foundations already set by Government’s Social Enterprise Action Plan.
It will drive action to create a culture of enterprise throughout the UK, improve the business advice, information and support available to social and economic entrepreneurs, remove remaining barriers to appropriate finance and eliminate unnecessary regulation.
Major new initiatives include additional financial support to the Prince’s Trust to help them identify role models and raise awareness of the benefits of enterprise amongst some of our most disadvantaged young people; pilot projects to run in a number of areas of Britain Women’s Business Centres, and an exciting partnership with Premier League Football Clubs to run an enterprise programme, that would build on the huge success of the Middlesbrough FC Enterprise Academy.
The new £10 million Risk Capital Investment Fund – the first of its kind in the UK - will also provide critical support for social enterprises in their start-up and early growth stages of development.
And we’ll continue to open up access for all types of SMEs to opportunities in the public sector. With better, clearer support and connections provided through services such as Business Link to those interested in working on major projects like the 2012 Olympics, and wider reform and delivery of UK public services.
Boosting efficiency, innovation and effectiveness in our public sector, I think are just as important to building a strong economy, as they are to creating a fair society.
Choice, contestability, new providers and the right rewards for good performance can all improve both the quality and value for money of our public services. And successive, clear evidence now shows that third sector involvement is helping transform the delivery of public services for the better.
This work with Government has been the most significant driver of your sector’s financial growth in the last ten years. And, I believe, there’s even greater potential for your share to increase beyond the £10.5 billion of income you currently receive today from this work.
In 2005-2006 current public spending on services was over £400 billion and of this procurement of goods and services was estimated to be nearly £120 billion. The Third Sector is already playing a leading role in this new, dynamic growing sector of our economy.
And a new public services industry is quite clearly now emerging in the UK. An industry capable not only of improving lives in Britain, but also exporting its expertise abroad.
That is why I recently commissioned an inquiry headed by the former Monetary Policy Committee member and distinguished economist Deanne Julius, to help us better understand the value of this industry, its importance to our economy and its potential for its future growth.
The study will consider areas where different sectors including the third sector – whose interests in the review are represented by ACEVO and the Social Enterprise Coalition - are best placed to carry out particular activities and potential barriers to entry and exit in these markets.
I believe that the Public Services Industry is exactly the sort of new industry that a modern department for business should be seeking to support, and in which dynamic organisations such as yours must be fully involved.
And I strongly encourage the sector – working with Government - to seek out new markets and expand existing markets for public services; and to challenge current shapes and structures of design, development and delivery to provide services based on the best needs of our customers.
This drive for customer focus is essential to the success of the public sector. And will further be supported by the recently launched Customer Service Excellence standard, which aims to encourage, enable and reward organisations from all sectors delivering services based on a genuine understanding of the needs and preferences of their customers and communities.
One of the most important functions of Government in today’s uncertain and increasingly competitive world must be to unleash the skills, talent and potential of our people to achieve their own and the country’s ambitions.
The Third Sector has a fundamentally important role to play here. Helping us achieve our goals through the services you deliver and the attitude and approach you bring to your work. Both in inspiring those new to enterprise and influencing the way we do business as a whole.
The opportunities and support available to help you get involved are increasing all the time. And Government remains committed to ensuring you can access and maximise the value of them.
Because driving growth, enterprise and innovation across all sectors is essential not only to ensuring future economic success, but our dreams of further social progress.
Thank you.