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The Emergence of Social Enterprise Policy in New Labour’S Second Term

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The Emergence of Social Enterprise Policy in New Labour’S Second Term THE EMERGENCE OF SOCIAL ENTERPRISE POLICY IN NEW LABOUR’S SECOND TERM Alibeth Somers Doctoral Thesis, Politics Department Goldsmiths College University of London April 2013 1 Declaration In line with University of London requirements, I hereby certify this work is my own. ________________________ Alibeth Somers ________________________ Date Word count: 98,562 2 Acknowledgements I am indebted to my supervisors within the Politics Department at Goldsmiths College for their support and encouragement. First, I would like to acknowledge the guidance of Nirmala Rao for initially serving as my supervisor and for supporting our project for the Economic and Social Research Council. I served as Nirmala’s Research Fellow for two years during the data collection phase of this research. I appreciate the opportunity both Nirmala and the ESRC provided. Next, I would like to express my gratitude to Richard Grayson for helping me develop the work through the upgrading phase. Richard was also supportive when I applied to re-start the doctoral work, for which I will be forever grateful. Finally, I would like to extend a tremendous thank you to Simon Griffiths, who served as my primary supervisor from 2011 through to submission. Simon guided me to the finish line with patience, sound advice, and expertise. I am not sure I would have made it to the end without his help. Within the social enterprise academic research community, Alex Nicholls has remained a steadfast colleague, mentor, and friend- debating contrary positions and helping me to refine my thinking. Alex Murdock recruited me for my first academic post six weeks into doctoral study, and served as a mentor as I found my feet with lecturing. I would also like to acknowledge the support of my colleagues at Goldsmiths in the Institute for Creative and Cultural Entrepreneurship. My Head of Department, Gerald Lidstone, has been very encouraging of my completing this doctoral work, even alongside my course convening and lecturing responsibilities. My colleague Siân Prime perked me up with humour during the writing up phase. 3 On a personal note, there have been a handful of people whose support has carried me through this sizable task. First, Barbi Appelquist always believed I could complete this research, even when the responsibilities of motherhood seemed too great in comparison. Second, my mother-in-law, Carolyn Somers, patiently listened to every iteration of what the doctorate might look like and consistently supported me even when my plans appeared most unrealistic. My brother Richard Mufson served as in-house head of childcare during my final months of writing up, and encouraged me through to the end, while my brother Brandon Kapelow and niece Clara Harr provided needed distraction when visiting. My children and my husband remained an ever-present cheering squad. My four and a half year old daughter, Emma, took to doing her own ‘PhD’ (which mainly consisted of colouring) alongside me, and her baby brother Reuben giggled and drooled over the last drafts. Finally, my husband, Charles Somers, despite offering to eat my PhD instead of having to read it, and accusing me once of making up words he didn’t recognise, has been my greatest source of support throughout my academic career and especially with regards to my doctoral research. He has given up countless hours of ‘free’ time to care for the children and scoot them out of the house, and remains my better half. Regardless of the stops and starts, and sometimes circular direction this research appeared to take at times, I learned a tremendous amount and am grateful for all of the support, encouragement and guidance I received along the way. 4 Abstract This doctoral research explores New Labour’s foray into social enterprise policy- making. In 2002, New Labour established the first ever Social Enterprise Unit and launched a series of policies in an effort to establish what it described as an ‘enabling environment’. This doctoral research characterises this unique time period as a first wave of social enterprise policy-making, when the policy idea is rooted in social enterprise as an alternative business model and anchored in the Department of Trade and Industry. This thesis is a comprehensive policy study that examines first how social enterprise became included in New Labour’s social policy agenda and analyses the way different policy entrepreneurs from inside and outside of the Labour Party championed the idea for myriad reasons. It then investigates the distinction between the rhetoric the Party used to describe social enterprise and the way it actually went about creating policies to embed notions of social entrepreneurship across Whitehall Departments. The final portion of the research investigates the implementation dynamics of this vast agenda and how regional and local government officers interpreted the various policy messages and objectives handed down from the centre. It is a case study that charts the development, design and initial implementation of social enterprise policy during New Labour’s second term in office, and relies on a combination of documentary analysis, participant observation, interview, and survey data to shed light on this phenomenon. 5 Table of Contents Declaration…………………………………………………………………………………….2 Acknowledgements……………………………………………………………………............3 Abstract………………………………………………………………………………………..5 List of tables, illustrations and figures……………………………………………………….11 Chapter 1: Introduction………………………………………………………………………14 1.1 Overview of research questions and hypotheses……………………………..14 1.2 Positioning the research………………………………………………….......20 1.3 Research design………………………………………………………………20 1.4 Developing the methodology………………………………………...………22 1.5 Data collection methods and triangulation…………………………………...25 1.6 Structure of the thesis………………………………...…………….………...33 Chapter 2: Literature review………………………………………………………………….36 2.1 Introduction to the social enterprise academic literature……………………..36 2.2 Overview of the chapter……………………………………...………………40 2.3 Defining social enterprise…………………………………………………….41 2.4 Social enterprise- extending or reforming capitalism?.....................................59 2.5 Putting forward new definitions: ‘state sponsored’ social enterprise and ‘civil society-based’ social enterprise………………………………………………60 6 2.6 Towards a definition of state sponsored social enterprise…………………....62 2.7 Understanding the role of the state in relation to social enterprise…………..67 2.8 Conclusion………………………………………………………………...….85 Chapter 3: Agenda-setting and policy formation………………………………………….....87 3.1 Introduction to chapter……………………………………………………….87 3.2 Connections between social enterprise and the Labour Party historically…...89 3.3 The prevalence of Third Way thinking as a lens through which potential policy ideas were evaluated by decision makers……………………………..93 3.4 The increased use of Special Advisers in the Cabinet Office under Prime Minister Blair (insider interests)…………………………………………......99 3.5 Outsider interests and how social enterprise leaders formally organized themselves…………………………………………………………………..113 3.6 Insider and outsider organized interests…………………………………….117 3.7 Kingdon’s model of agenda-setting as a way to understand social enterprise’s inclusion in New Labour’s policy agenda (as a heuristic device)…………..128 3.8 The changing role of the state and the impact on the policy process: how remnants of corporatism may help explain the rise of social enterprise in the importance of ideas…………………………………………………………136 3.9 Conclusion…………………………………………………………………..144 7 Chapter 4: Cross-cutting reviews as a component of policy design………………………..146 4.1 Introduction…………………………………………………………………146 4.2 Analysis of sector review Private Action, Public Benefit- A Review of Charities and the wider Not-for-profit sector……………………...……….154 4.3 Mapping the ‘non-charitable not-for-profit’ sector…………………………162 4.4 Identifying barriers to the sector’s growth………………………………….164 4.5 Analysis of HM Treasury’s review The Role of the Voluntary and Community Sector in Service Delivery…………………………………………………..172 Chapter 5: The launch of the ‘enabling environment’ for social enterprise………………...182 5.1 Introduction………………………………………………………………....182 5.2 Analysis of New Labour’s Social Enterprise: A Strategy for Success, Department of Trade and Industry……………………………………….…186 5.3 The modernization agenda as an influencing factor in social enterprise policy design……………………………………………………………………….197 5.4 Identifying New Labour’s policy objectives for social enterprise………….201 5.5 Barriers to social enterprise growth…………………………………………205 5.6 The role of intermediaries and other organizations (outside organized interests)………………………………...…………………………………..214 5.7 New Labour’s social enterprise strategy and the role of Europe…………...215 5.8 How other cross-cutting reviews undertaken by New Labour influenced the design of the Government’s Social Enterprise: a strategy for success……………………………………………………………………....217 8 5.9 How New Labour viewed the role of the regions in bringing the social enterprise agenda forward…………………………………………………..218 5.10 The role of zeitgeist in social enterprise policy design……………………..225 5.11 New Labour’s action points arising from the Social Enterprise: a strategy for success……………………………………………………………………...226 5.12 DTI’s ‘A progress report on Social Enterprise: a strategy for success’..….231 5.13 The transition from first to second wave policy making for social enterprise……………………………………………………………………237 5.14 The key components of the Social Enterprise Action Plan…………………239
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