NEWSMAKER: Another charity minister - Stephen Timms, Minister for Social Enterprise, Department of Trade and Industry


If ever you feel that your case is not being heard in the corridors of Whitehall, it is not for want of an available set of ears. There are at least five ministers in the Government with direct responsibility for the voluntary sector. The unobtrusive Lord Filkin is actually minister for the voluntary sector. But he may be forgiven for bemoaning "the scooters on his lawn".

Paul Boateng, who became chief secretary to the Treasury in the June reshuffle, is responsible for the Treasury's cross-cutting review of the voluntary-sector's role in public services, due to be published in September. John Healey, who replaced Boateng as financial secretary to the Treasury, is in charge of charity taxation issues. And when David Blunkett gets bored with prisons and reading people's emails, he occasionally weighs in on the voluntary sector's role in building strong communities. As sponsor minister, Blunkett is also now responsible for the Performance and Innovation Unit's delayed review of charity law and regulation.

The latest addition to this varied voluntary-sector cabal is Stephen Timms, of the Department of Trade and Industry (DTI). The 47-year-old former telecommunications manager and leader of Newham Council replaced Douglas Alexander as Minister for Social Enterprise earlier this summer, after stints at the Treasury and the Department for Education. He is responsible for implementing the DTI's social enterprise strategy, launched last week, which aims to "increase the involvement of social enterprises in public-service delivery and reform".

"Social enterprise

might not be a term that mainstream charities readily identify with, but the concept seems to be gaining acceptance as organisations find new ways of earning income, rather than just relying on grants. But will the ministry for business be a sensitive and responsive partner for bog-standard charities as well the "social businesses

in childcare and recycling that seem to chime so closely with its rhetoric and outlook?

Timms is adamant that the needs of the traditional voluntary sector will not be neglected. "We see the strategy as very much aimed at mainstream charities,

he says. "There are some superb social enterprises that are the trading operations of charities. I certainly hope that charities will see the benefit for them in the strategy. For example, getting business support for their operations using Business Link (the network of assistance for small businesses) to find new ways of improving the capitalisation of trading operations. That will be relevant to the things charities are doing."

The DTI's strategy comes just a week after the publication of the main recommendations of the Treasury's review of the voluntary sector and public services. Indeed, the final Treasury report will include a chapter on social enterprises in the delivery of public services. But while the Treasury has merely signalled a determination to ensure that public-sector procurers begin to pay charities' core costs in full, the DTI is clear that social enterprises can make a healthy profit. And remember that their definition of social enterprise includes trading charities.

"The way I envisage this to work is that a social enterprise would put in a proposal alongside everyone else,

explains Timms. "There is absolutely no pressure on anybody not to make a profit. In areas like leisure and childcare, social enterprise has a particularly interesting contribution to make. Just as we are seeing a bigger role for the private sector in public services, there are no restrictions on making a profit. What we are looking for is the innovation that new providers offer. Then there is the question of what prices they set. But it's quite wrong to say to people that they can't make a profit."

It may be an example of famously disjointed Government, but isn't there a coded message for the voluntary sector here? Charities have long bemoaned the fact that for-profit contractors can demand high mark-ups from government departments while they are forced to dip into voluntary income to support contracted projects that aren't even paid for in full. But instead of trying to get blood out of a stone as a not-for-profit provider, why not reinvent yourself as a "social enterprise

and demand not merely full project costs, but a profit as well?

But before social enterprises can mutualise the public sector, there are some practical issues to consider. Many in the sector lament that while they would like to provide services, their asset base is too small for them to compete with other providers, and access to mainstream finance is limited. The DTI intends to address this through a review, undertaken by the Bank of England, to examine the provision of debt and equity finance to social enterprises. Scotland already has Social Investment Scotland - a £3 million loan fund for the social economy set up by the Executive in September 2001. Could the UK government follow suit?

The very fact that the Bank of England is involved suggests that the Government does take the social-enterprise sector seriously, and its role in public services. The "blue-skies thinking

at the DTI suggests that the sky's the limit as far as their role is concerned.

Timms, however, is circumspect and prefers to concentrate on the here and now. "At the moment, we are just at the stage of wanting to encourage more recognition of the potential in the public sector that social enterprises might have some-thing to offer."


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