Sadiq Khan is a politician who understands the impact that socially focused businesses can have on London and the United Kingdom. Back in September 2015, before he was selected as Labour’s candidate for mayor of London, Sadiq made an important media statement. He announced his vision for a public procurement system that gives social enterprises a genuine opportunity to show society the kind of mark they can make on our public services.
Specifically, Sadiq told us how he wants social enterprises to have a chance of successfully bidding to run London’s bus services. Key to his reformist ambition for a fairer type of business, Sadiq appreciates what we mean when we say ‘social value’.
Not everyone will necessarily define social value in the same way, but in simple terms it means taking into account the economic, social and environmental wellbeing of the areawhen assessing a service provider’s bid. The concept is gaining momentum among progressive entrepreneurs and is now enshrined in specific legislation, as well as in public procurement laws. Social value seeks to replace a simplistic selection based only on the cheapest offer. Sadly, taking what appears to be a bargain in the short term is all too commonplace for some of our public commissioning bodies. That is why we need forward-thinking politicians like Sadiq – a future mayor of London prepared to look at long term savings generated by social enterprises that pile profits into improving society.
Social enterprises are businesses that pride themselves on providing social value: often reinvesting profits back into the community, paying fairer salaries and having a social mission as the basis of their existence.
Pioneers of the social venture world offer us exciting glimpses into what the future of the business world might look like. Consider Belu, the bottled water social enterprise that uses all its profits to fund clean water projects, having supported the charity Water Aid and donated over £1m to date. Belu does this while holding environmental standards as a primary concern – using the highest level of recyclable materials possible.
Then there is Bounce Back, that competes with private companies in the trade of painting and decorating. This social enterprise provides training, work experience and employment for offenders at the end of their sentences. It claims to have helped 80 per cent of their participants into paid employment. Bounce Back tells a compelling economic story on its website: it costs up to £90,000 a year to keep someone in prison and £29,000 to keep them on benefits. To train someone through Bounce Back costs just £2,500.
Back to the topic of transport, we then have HCT Group; a multimillion-passenger transport organisation that reinvests profits from its transport services, trains people who have been long-term unemployed and creates job opportunities in deprived communities.
Sadiq recognises the successful social enterprises that exist and the potential there is for a new type of economy. Sounds a little utopian doesn’t it? The Labour party owes it to Sadiq to get him elected as mayor of London so he can put his understanding of social value into practice and help the wave of social value continue.
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Tom McNeil is director of the Human Rights Act Campaign at the Labour Campaign for Human Rights and a former parliamentary candidate. He tweets at @McNeil_Tom
