INSPIRE is a broad-based partnership in North-East England that aims to put the development of social enterprises onto a more professional footing, by replicating business models that are already proven successes. It is focusing on three growth sectors – the environment, tourism and care – and it is in the care sector that it has made spectacular progress. From its base in Sunderland, Care & Share Associates (CASA) is launching a chain of employee-owned home care companies all over the region. It has aroused a great deal of interest among policy-makers, and has already created 70 new jobs.
The INSPIRE partnership set out to apply a new and more strategic approach to the creation and growth of social enterprises. “Our idea was to raise the scientific level of the social enterprise creation ‘industry’, by giving it a research and development function,” co-ordinator Keith Richardson explains. “Our partnership set out to identify promising market niches where social enterprises had a high chance of success, and then developing businesses to occupy these niches. The result would be not just one new business, but a whole cluster of businesses, which is good not just because it creates jobs but because they can support each other.” The project also wants to avoid creating a support organisation that has no stake in the success of the businesses it supports. “Inspire is not just here to keep itself alive – it has a market incentive,” says Mr Richardson.
This conception fitted well with the regionalisation of local government that is under way in the UK. The idea needs a certain scale to work well, so the partners approached One North East, the government-appointed regional development agency (RDA) for the North-East of England, for support. In doing this they were building on the work of the first round of EQUAL, as one of the strands of work under the Social Enterprise Partnership (SEP) was to establish regional support bodies. Out of this grew the North East Social Enterprise Partnership (NESEP), which brings together all the important federal bodies in the sector. Along with NESEP, Inspire brings on board other key actors such as the regional branches of Social Firms UK and the Development Trusts Association as well as a number of local social enterprise development organisations. It thus works by being a very inclusive partnership, although one family – the voluntary sector – is only peripherally involved.
The home care revolution
As lifespans lengthen and technologies for independent living improve, more and more elderly and disabled people can be cared for in their own homes instead of moving into institutions. The vast majority of people prefer this, and it represents a revolution in the way care is provided. First, it implies a rapid increase in the quantity of care that is required. In the first half of this century, the share of over-65-year-olds in the EU population is set to double to 30%, while the share of over-80s will more than triple, to 12%. As much of the cost of this is borne by the public purse, this puts a premium on cost-effective delivery if tax rates are to be kept under control. And it is not only elderly people who are involved: in the EU there are several million people with disabilities, who need care in their homes. In their search to find a cost-effective way of providing high quality care, public authorities have turned to outsourcing, and an increasing share of care budgets is allocated through a process of tendering. In the care sector more than most, the carer’s involvement and commitment to the service quality is a key criterion of success. “This is exactly why we have adopted an employee ownership structure,” says Margaret Elliot, Director of Care Services at Sunderland Home Care Associates (SHCA), a company that has achieved somewhat of a celebrity status in Britain, and is INSPIRE’s first candidate for replication. “Our employees own a share of the company, and this is a significant incentive in a sector where wages are traditionally not very high.”
Founded in 1994, SHCA is now the biggest home care provider in Sunderland. It serves 500 clients and employs some 175 people, who deliver around 3,700 hours of care each week – in other words they work on average about half time. All but about 20 of the staff are women, and this flexibility of working time is a very important factor for them, especially those who already have family caring responsibilities. The company has also diversified out of home care. One service it offers is academic support, which is a service paid for by the local education authority, through which students with disabilities receive assistance in attending lectures and completing other study tasks. SHCA also provides short-term cover in residential care homes when they face a staff shortage. Quality is a key competitive factor, and SHCA’s employee-owned structure enables it to attract a high-quality workforce and to offer them high-quality jobs, with above-average terms and conditions and workforce training. This builds loyalty: the staff turnover of only 3.5% a year means it can provide a high level of continuity of care. The company constantly monitors the service it is providing, and employs four supervisors who are continually making the rounds to ensure that quality is up to scratch. Users are also asked to comment on their level of satisfaction with aspects such as the carers’ timekeeping and disposition.
One of SHCA’s clients is Peter Usher, a multiple sclerosis sufferer who lives in Pallion, near the centre of Sunderland. Carers Stan Hartley and Jimmy Cook visit four times a day to help Peter to get up, washed and dressed, and to go out to the shops, to the barber’s and so on. Twice a week, they come for a longer period of four hours, which allows his wife Debbie, who has had to give up her job to look after him as his disability has progressed, to go out. “We had the choice of employing a carer ourselves, from among family and friends, but we didn’t want to have to manage tax and national insurance,” she says. “So we chose to use SHCA. It means we can stay with the same carers, Stan and Jimmy.” The Ushers are one of the relatively few families on the ‘direct payments’ system, which means that they receive an allowance from Sunderland City Council, which they use to pay SHCA’s bills. “The government would like to see half of all home care to be within the direct payments system, which means that the market for care co-operatives is bound to expand,” Ms Elliott says.
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As part of its EQUAL project, INSPIRE has worked with SHCA to set up Care & Share Associates (CASA) as a vehicle to replicate the same model in other towns – work which has so far created 70 new jobs. The first success was just up the coast in North Tyneside, following an introduction effected by Sunderland’s Director of Social Services, after he moved to the borough. North Tyneside Home Care Associates was launched in May 2004 and now employs over 30 people. Newcastle and Manchester are also in operation, each delivering some 400 hours of care per week. Next, the adjacent borough of South Tyneside awarded CASA a contract, and negotiations are now under way in several other towns and cities across Northern England, including Darlington and Sheffield. A start was made in Middlesbrough, but this has petered out. Contacts have also been made in Scotland. Given the model’s track record and the inexorably growing market, there is interest across the political spectrum. Ms Elliott has been to meet both Prime Minister Gordon Brown and David Cameron, Leader of the Conservative Party, and has even flown to Hong Kong to explain how it works. CASA is represented on the group advising the government’s Third Sector Commissioning Taskforce, and its experience has been reflected in a white paper issued by the Department of Health. The Royal College of Nursing has adapted the idea in the form of the ‘nurse-led social enterprise’, and a group called Viva has been set up to promote employee ownership in the health sector. On the European scale, regulatory differences in the care industry mean that it will be more difficult to replicate the idea, but the partners feel that the employee ownership aspects are very transferable.
This steady process of growth through multiplication will be sustained through a central structure. Care & Share Associates (CASA) will keep a 10% shareholding in each new care enterprise it spins off. These will then pay an annual licence fee of around £35,000 (€50,000) plus a small percentage of their turnover (around 0.25%). Each federated company will also hold shares in CASA, thus ensuring the coherence of the group.
What CASA offers its franchisees
- business planning and contract management
- the business manual – covering philosophy, brand and image, personnel systems, financial systems, operations and care management (personal care plans, user focused services, safe working practices, risk assessment)
- quality systems to comply with inspection regime
- recruitment and induction
- early-stage interim management support
- ongoing administrative and training support
Experience teaches that one of the most critical steps in getting a new care business up and running is finding a good manager who has experience of home care, and installing them ahead of time. But before that stage can be reached, the necessary partners have to be brought in board. These include the local social services department, the employment services and whichever body is responsible for regeneration in the area concerned. According to Guy Turnbull of Economic Partnerships, the consultancy that manages Inspire, an investment of about £75,000 (€110,000) is sufficient to create around 20 high-quality jobs.
Three manuals for three promising sectors
Home care is not the only string to INSPIRE’s bow. “We identified three sectors of the economy where the time is ripe for colonisation by social enterprises,” says Dr Turnbull. “These are care, the environment and culture and tourism, all key areas of jobs growth the European Commission identified in 1996. We’ve made fastest progress in care, but the others are moving forward too.” Inspire is in the process of setting up a project called Community Energy to promote local renewable energy ventures. “Renewable energy is a tremendous opportunity,” says Keith Richardson. “People still talk about social enterprises as away of coping with failures of the market or the public sector, but we say no, it is an alternative way of doing many things. Energy is a large economic sector, so if we can bring part of it under community ownership, then it is good for everybody.” Community Energy has discovered a lively public interest, with its network meetings attracting 50 or more people. In Berwick, along with the local Development Trust, Inspire is investigating opportunities to build wind farms, and companies are being set up to provide biomass heating and combined heat and power (CHP). It is also working with the Forestry Commission, the national forestry organisation, to develop wood chips as an energy source. Other ideas are to produce biodiesel from old chip fat, and to market renewable energy certificates (ROCs).
Sustainable transport is another area of INSPIRE’s work, and one where transnational learning is taking place. Having taken a look at the car-sharing scheme in Genoa, Paul Balmont is leading a pilot project to replicate it in North-East England. “We are starting a two-car pilot scheme in Durham in October 2006,” he says, “and Newcastle and Darlington are also interested.” Using the new legal structure for social enterprises that was introduced in the UK in 2005, the project has founded a Community Interest Company called Option C to promote new car-sharing schemes. Towards the end of the project, the partnership plans to publish a manual for each sector, plus a portfolio of cases.
Scaling up - a transnational company in view
INSPIRE’s transnational partnership is called Sustainable Business Concepts for the Social Economy, although its acronym, SIPS, echoes the process of ‘sharing, identifying, promoting and supporting’ new business ideas. It brings together a second British partnership, Realise, as well as organisations in Germany, Finland, Italy, Lithuania and Poland. “The relatively high number of partners, covering six countries, is a deliberate choice,” says Mr Richardson, “because we aim to set up a European company.” This offshoot, INSPIRE Europe, will work on the issue of replication at European level. SIPS’ work was launched, along with that of INSPIRE, at a conference in Newcastle in November 2005, which established a series of working groups. The second major event took place in Berlin in September 2006, and was based on the ‘open space’ methodology, through which participants collaboratively defined their own subject matter and working methods. It also offered a programme of visits to German social enterprises.
Particularly with such experienced partners, the single European market means that this transnational collaboration can quickly move from words to deeds. The project intends to contract its Genoese partner WIP (Welfare, Inclusione, Partecipazione) to develop social enterprise in catering, with a view to bidding to supply school meals in Newcastle.
Discussions have also resulted on setting up a ‘recycling village’ in the North-East England, an idea that Germany and Finland are also aiming to transfer from the USA. Such a village acts as a focus for businesses to be created to process various fractions of the waste stream, and to market their products, which might include for instance salvaged architectural elements, pens made from waste paper or furniture made from plastic chips. “The village concept overcomes the problem of fragmented waste collection, enables a higher-tech process to be used, and identifiable products to be marketed,” says Mike Berriman, who is leads the environmental strand of INSPIRE’s work.
DP name: INSPIRE
DP ID: UKgb-123
Transnational partnership: TCA 3609 SIPS – Sustainable Business Concepts for the Social Economy
Partners: DE-XB4-76051-20-20/279 – INCUBE, FI-74 – Sustainable Employment for Social Firms (SESF), IT-IT-G-LIG-009 – Welfare, Inclusione, Partecipazione (WIP), LT-13 - Neįgaliųjų verslo plėtros bendrija, PL-59 – Mazurski Feniks, UKgb-103 – Real Employment and Livelihood in Social Enterprise (Realise)
Contact: Richard Falconer
Address: North East Social Enterprise Partnership (NESEP), Starting Point, Wawn Street, South Shields, Tyne & Wear NE33 4EB, UK
Telephone: +44 191 427 2150
Fax: +44 191 427 2155
E-mail: firstname.lastname@example.org Website: http://www.nesep.co.uk