HC Deb 16 March 2000 vol 346 cc272-3W
Mr. Love

To ask the Secretary of State for Trade and Industry what assessment he has made of the role of social enterprises in overcoming social exclusion; and if he will make a statement. [114635]

Mr. Byers

The Government recognise the important contribution role that social enterprises have to play in the nation's economy, including helping to overcome problems of social exclusion. They can be effective at developing services which the private and public sectors may be unable or unwilling to provide. Social enterprises can also be valuable in engaging local communities in economic activities that they would otherwise not have undertaken. Some estimates put the number of people employed in the not for profit sector nationally as high as 2.6 million.

The Social Exclusion Unit's Policy Action Team's (PAT 3) Report "Enterprise and Social Exclusion" which was published on 2 November 1999, included recommendations on the role of social enterprises in encouraging enterprise in disadvantaged groups and communities. The Small Business Service (SBS) is taking forward the Report's recommendations about support for social enterprises and about enhancing the potential of these businesses.

The SBS' s Social Inclusion Unit is working with the British Bankers Association and Social Enterprise London to produce guidance about the sector for banks as well as Business Links and other support organisations. The Unit will also be participating in a study visit to Spain in April to examine approaches to supporting social enterprises in that country.

On 10 November 1999 I announced the establishment of a national Phoenix Fund, with a budget of £30 million over three years. The Phoenix Fund will support entrepreneurship in deprived areas and respond to issues raised in the PAT 3 Report. It will be open to social enterprises as well as other businesses. The Phoenix Fund will provide funding for:

  • piloting of the Business Volunteers Mentoring Association;
  • support for new and existing Community Finance Initiatives;
  • a development fund for innovative ways of supporting enterprise in deprived areas.

My Department is currently considering ways of developing the Fund for the benefit of businesses.