Rochdale Borough Social Enterprise & Co-operative Forum. Our Stronger Together proposal

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1 Rochdale Borough Social Enterprise & Co-operative Forum Our Stronger Together proposal SEPTEMBER 2016

2 1. Purpose: Who this is for This report outlines our Stronger Together proposals for creating a good local economy. It was endorsed by our members at a meeting on 26 July. We now want to share our proposals with potential partners in advance of the Stronger Together conference on 29 September. 2. Introduction: Our big idea and invitation to you Stronger Together is our big idea to draw on the Borough s co-operative heritage to create our vision of a good local economy. By this we mean one in which key partners in the Borough are committed to work together to create community wealth and wider well-being; businesses that are locally owned, jobs that people want, chances for people to do things and feel better about themselves, services that people need, communities where people want to live and opportunities for young people to aspire and achieve. We see great opportunities for local co-ops and social enterprises in all this, but we need partners and communities that want to be part of this good local economy: public bodies, local businesses and voluntary and community sector organisations; that s what we mean by Stronger Together. We re inviting you to be part of it. 3. Background: About us, what we ve done so far and what we want to do next The Rochdale Social Enterprise and Co-operative Forum is the network of the Borough s co-ops and social enterprises. After our AGM last year, we started thinking about strategic ways of strengthening and growing our sector. We did a SWOT analysis of the state of, and prospects for, co-ops and social enterprises in the Borough: Strengths: A significant cluster of co-ops and Community Interest Companies Three large spin-outs of Council services Opportunities: Use of social value in procurement Community Rights to bid for assets, deliver services, etc * Responsibility for services devolved by Government to Greater Manchester. Consensus and co-operation amongst local businesses, organisations and people to work together. * As per the Localism Act 2012 Weaknesses: Otherwise generally small Few employees Low turnover Limited capacity. Threats: A near static economy Austerity cuts to public services Hardship in communities Plus now, the uncertainty of Brexit. 1 / 6

3 We needed a more detailed picture as a basis for drawing up proposals, so we carried out a survey of co-ops and social enterprises in the Borough. Overall the findings highlighted the contribution that local co-ops and social enterprises can offer with appropriate support to developing a good local economy. We found they: make up a significant cluster to build on, a best kept secret that could become the future business model of choice, are committed to benefiting the communities they serve, provide a wide range of services, adaptable to people s needs and aspirations, include some big ones ( Spin outs ) need improved relationships with those responsible for commissioning and procurement of services. We liked what we heard about anchor institutions (often large public bodies in the community) procuring goods and services from local co-ops (and, we d also suggest social enterprises and other local businesses) to help generate and keep wealth in the community. At the seminar on 29 th September we will also share our knowledge of what is happening in the UK and internationally with you, as well as explore what is already happening in the Borough itself. We used the findings of the survey as a basis for our proposals to create a good local economy that creates opportunities for everyone and strengthens and grows community wealth. Section 4. below sets out some of the key outcomes and objectives which we believe are necessary for a good local economy. It is not the intention to discuss these in detail at the forthcoming seminar. But we hope that they do promote discussion about a shared vision and set of principles as well as offer the basis for future debate about how we can collectively proceed. 4. Our proposals: What we want to happen Our vision, the general outcomes we want to see and broad objectives to achieve them are shown in the table below: Vision - A good local economy for Rochdale Borough Outcomes A committed community - working together and creating community wealth More locally owned businesses - including coops and social enterprises Good jobs and chances to achieve Good Services - that meet people s needs Good Communities - that people want to live in. Objectives Improve the ability of Anchors such as the Council, other public bodies and locally owned businesses to work with local voluntary and community sector organisations Support co-ops and social enterprises - to build capability and capacity. 2 / 6

4 We now look at our proposed objectives in greater detail: (a) Commit to working together A good local economy has good businesses, good quality jobs and good opportunities for people to create jobs for themselves and others i.e. enhance community wealth and well-being. We re not saying these things don t exist in the Borough, but more could be done to build their stake in the local economy, to create community wealth and to achieve better outcomes for everyone across the Borough. Given the current uncertain state of the UK economy, and the huge financial and social pressures on public services to reform and cut costs, we firmly believe that new ways need to be found to work together in the interests of local people and the wider prosperity of the Borough. We recognise that some forms of sharing of resources already exist within and between some local agencies. But we believe that this is rather piecemeal and capable of much greater development if framed within an explicit focus: Stronger Together. So doing something is down to those who can make the Borough s economy and services work better for people in other words those who are economically active within the Borough and who have a choice of how to buy, sell and deliver goods and services. These players can do more if they work together with a shared commitment to pursue common interests. It can be done. Emilia Romagna is one of the most prosperous regions in Italy. Businesses co-operate on a substantial scale to market and sell their products while remaining independent. Employment levels are high. We propose that potential partners sign up to a Charter for local economic co-operation setting out their shared commitment, common interests and willingness to work together to create a good local economy that benefits everyone. (b) Love co-ops - and social enterprises Local businesses have important roles in local economies as purchasers, suppliers, and employers. However, a lot of people feel they have no say in the businesses they use and the places they work. Increasingly people like the idea of getting together to keep local assets and would use co-ops set up to provide local services. Local co-ops and social enterprises then can have an important role in creating local economies that work for people and benefit the communities they serve. It s a fact that co-ops are more resilient than conventional businesses. Their employees, the users of their goods and services or both are the owners and have a stake in them. They tend to be more productive, innovative and entrepreneurial. We propose that, alongside local conventional businesses, potential partners support local coops and social enterprises being given a key role in creating a good local economy by reaching people and communities that other businesses and services find difficult to do. (c) Agree to audit It is generally accepted that spending 10 locally creates an extra 4 when re-spent in the local economy. Manchester and Salford Councils have carried out audits of the impact of their spending on procurement of services. They know how much stays in as a result of procurement from local 3 / 6

5 suppliers and how much leaks out to businesses in other areas. Preston s spend has been audited in this way, as has RBH s spend on employees and supplies, to provide a baseline for further action as an anchor institution (see below). So, agreeing to audit is a crucial step for potential partners from talking the talk to walking the walk. To better enable local co-operation we suggest it is necessary to find out how commissioning and procurement can be improved to reduce barriers for local co-ops, social enterprises and business to offer their goods and services, whilst still complying with regulation. For our part, we d want an analysis of the contribution of co-ops and social enterprises to date, future opportunities for them to set up and grow, and their support needs. Whilst commercial confidentiality will have to be protected, such information is crucial We propose that potential partners should agree to audit their spend and provide information about their processes for commissioning and procurement of services, the monetary value of contracts, the current destination of spend, availability of alternative local suppliers and opportunities for co-ops and social enterprises, including consortia of businesses or voluntary organisations. (d) Adopt Anchors Institution Model: Anchors, intermediaries, communities and people The concept of anchor institutions originates in Cleveland, Ohio, in the USA. Large non-profit organisations with a long term stake in the place committed to: work together, buy from local businesses and, when opportunities arise, set up Evergreen Co-ops to deliver services, employing people disadvantaged in the local labour market. By doing this they hope to make their operations more sustainable whilst supporting the local community. Preston Council has adopted this model, including setting up worker co-ops to help create community wealth. Currently RBH is exploring the anchor model as a development of its status as a mutual, which we applaud. Our Anchors Institution Model: Anchors, Intermediaries, Communities and People Anchor Institution (Purchaser) Contracts & support Goods & Services Intermediary Co-ops/social enterprises (Supplier) Goods & Services, jobs, vol opps, skills Workforce People & Community Groups (Users of services, employees, volunteers) We propose that RBH and other public bodies consider adopting our anchors, intermediaries and communities and people model for procurement of services to maximise the creation of community wealth and other benefits. We also propose that our potential partners promote the anchor model to other businesses and voluntary organisations in the Borough. 4 / 6

6 (e) Get organised Creating a good local economy requires changes by all parties involved. The concept will have to be promoted - information provided - training delivered - new ways of working developed resources found and allocated, etc. There is a model. Mondragon in the Basque Country has an international reputation as a place with a highly successful co-op economy, supported by the Mondragon Corporation. Our view is that a similar local development support service is needed to work with not just co-ops and social enterprises but all potential partners in our Stronger Together initiative (see diagram). Promotion Development Finance & investment Advice & Information Training & Education Research & Innovation We d envisage that the Forum s future role may be as the representative body for local co-ops and social enterprises, subject to the structure of such a support service. We propose that our potential partners should back the concept of a local economic development support service to underpin participation by all public bodies, businesses, co-ops and social enterprises and voluntary and community organisations that get involved in the Stronger Together initiative. (f) Make a start We know that our ideas aren t dissimilar to those of at least some of our potential partners. We know RBH is looking at its role as an Anchor, including the implications of taking a lead role in developing the concept in the Borough. We d hope that others will join them. The adage two heads are better than one implies that three heads are better still (and generally regarded as the minimum necessary for co-operation). So, assuming RBH confirms its intent, we d encourage at least two other potential Anchors to also make a start on the initiative with them. Similarly, we d encourage other potential partners to declare their interest. Next, we d encourage the potential Anchors and other partners to allocate lead responsibility for the initiative, tasking them with working together to maximise the impact of actions to create a good local economy that benefits everyone. With the same purpose in mind, the potential contribution of related functions should be explored. We d suggest asset management, commissioning, economic development and procurement, as a start. In this way, policy changes and changes in practices will come about and a de facto Stronger Together partnership will emerge. Recognising the reality of public sector spending cuts on many of our potential partners and the communities they serve, we are not asking for resources beyond the realignment of some services, as suggested above. We may be able to apply for Power to Change Lottery funding to support the changes we outline here; buying in services, such as information and training. If potential partners wished to put more resources into the initiative, then potentially even more could be achieved over a shorter period. 5 / 6

7 We propose that potential Anchors and other partners should allocate responsibility for action to create a good local economy, start working together to maximise impact and make links with related functions. For our part, we will investigate sources of funding to support the changes we want to see. (g) Go beyond Anchor model Our proposals are essentially about getting an Anchor model of local community wealth development in place in the Borough. There will be more to do maximise its impact: improving communication, making portals accessible, reducing the size of contracts, etc. Local co-ops and social enterprises should be involved in these processes. Increased community wealth is the ultimate outcome to be achieved by a good local economy. That means strengthening and growing community ownership: increasing membership of the Borough s credit unions, enabling local investment, setting up community land trusts, supporting community use of public buildings and land, solutions to housing needs of communities, community renewable energy schemes, environmental schemes, local food, co-operative education. We propose that our potential partners go beyond broad agreement on the Anchor Institution Model and explore other initiatives to further develop a good local economy that delivers fair shares of community wealth. Contact Us For more about our Stronger Together initiative, Rochdale_Stronger_Together@hotmail.com Please find us and support us on social media: RSECForum RSEC_Forum Rochdale Social Enterprise & Co-operative Forum Acknowledgements The following Forum Members have been involved in the Stronger Together initiative and the preparation of the proposals in this report: Nick Andrews, Steve Bewick, Edward Carpenter, Jan Hicks, Claire Jefferies, Andrew Jessop, Tanzeem Mahmood, Rick Walker and Andy Wiggans. 6 / 6