SHOULD LEPs set distinct rural or social enterprise objectives, or should they mainstream those issues through their other objectives? Brian Wilson finds out.

SHOULD LEPs set distinct rural or social enterprise objectives, or should they mainstream those issues through their other objectives? Brian Wilson finds out.

A short piece of research by the Social Enterprise Strategic Partnership (SESP) about the potential of social enterprises in rural areas to contribute to the growth objectives of Local Enterprise Partnerships (LEPs) has been published by Defra.

The importance of LEPs has increased as their responsibilities and budgets have expanded. It is not surprising that rural commentators have wondered how best to achieve some leverage over their ambitions and activities. Indeed, Defra has acknowledged this point by setting up a forum to meet regularly with a LEP grouping.

This research could be characterised as being about both rural proofing and social enterprise proofing.

SESP note that social enterprises are a diverse bunch with one thing in common – they all have a social purpose, seeking to tackle social problems, improve communities or address environmental concerns.

The sector has been growing fast – the wholly believable claim is that it has grown quicker than the rest of the economy. For example, evidence elsewhere is that there are now over 300 community-run shops and over 150 community-run pubs. Such rapid growth is reflected in the fact that 14% of social enterprises can be classified as 'start up enterprises', being less than two years old. The sector can therefore be seen as an important enabler of rural economic growth.

The SESP case is that rural social enterprises offer a number of advantages that can help LEPs meet their objectives and that some of these are things traditional private enterprises find hard to replicate.

As already noted, rapid growth has been one advantage, with average (median) turnover of social enterprises growing from £175,000 in 2009 to £240,000 in 2013. They are also likely to create more jobs relative to their turnover, according to earlier work by Social Enterprise UK. They are more likely than other businesses to operate or have reach into deprived communities and they achieve high levels of community support.

Interviews with a few LEPs have identified elements of positive engagement with the sector.

Cumbria is said to have the highest density of social enterprises of any county, some of which are well known and have won awards. The Cumbria LEP has sought to engage the sector both through established channels, such as the RDPE Local Action Group, and by bringing representatives onto its own governance arrangements. Its five member Advisory Panel includes a representative from Cumbria Social Enterprise Partnership, who sits alongside others from the Federation of Small Businesses, Chamber of Commerce, National Farmers Union and Cumbria Tourism.

According to Cumbria LEP the social enterprise sector fits well with its mainstream objectives whilst adding value, such as reaching groups who struggle to access employment opportunities.

This theme is picked up by the Cornwall and Isles of Scilly LEP who have a sub-group on inclusion issues which is chaired by a local social enterprise CEO.

The Marches LEP takes a rather different approach and views social enterprise as a stand-alone sector that needs a voice. Its engagement with the sector takes place mainly at a local authority level via a 'partners with social enterprise' network. This is essentially a forum for social enterprises that meets quarterly with the LEP and the local authorities. One thing it has tried to do is make the sector more aware of funding opportunities.

The research concludes that these examples raise two linked questions. Should rural development be treated as a separate LEP priority or be integrated within mainstream LEP priorities? And should social enterprise be treated as a separate LEP priority or be integrated within mainstream LEP priorities?

Rather than come down on one side or the other the report identifies the pros and cons of each approach, noting there may be local reasons for adopting different approaches. Perhaps it begs another question: do we need to choose or could both be applied? If we must choose, it may depend on the rurality of the LEP area. It can be argued the more rural the area the less need there is for a distinct rural priority, since rural may be the mainstream.

At a very practical level the report notes that these LEPs maximise their engagement with the social enterprise sector by ensuring Board representation, by including them in their communications and newsletters, and by inviting them to meetings or events. That sounds like a reasonable starting point.

It would be fair to say that LEPs have come in for some criticism for focussing heavily on urban centres and mainstream business interests, at the expense of rural areas and social or community enterprises. This report from SESP paints a rather different picture. Doubtless the reality is that the situation varies significantly around the country.

This article was written by Brian Wilson whose consultancy, Brian Wilson Associates, can be contacted at [email protected]. Brian also acts as the RSN Research Director.