Ireland is one of the worst places for social entrepreneurs - here's why that needs to change

ALL SOCIETIES GAIN from a vibrant social enterprise sector, but Ireland seems to be determined to turn its back on those benefits.

A report carried out by Forfás four years ago revealed that the Irish social-enterprise sector had the potential to generate 40,000 new jobs and add €2 billion to GDP if the right conditions were provided by government.

The government at the time undertook to act on this report, but this promise remains unfulfilled and the potential of the social enterprise sector remains unrealised.

Social enterprises are organisations whose main objective is to have a social impact rather than make a profit.

They can offer goods and services to the market on a commercial basis and use the profits from that activity to achieve social objectives, or they can meet social needs in an entrepreneurial and innovative fashion but with a not-for-profit ethos.

In 2016, the Thompson Reuters Foundation conducted a global study ranking 44 countries for their social entrepreneurship environment. Ireland ranked second last, behind countries such as Colombia, Mexico and Pakistan.

Even more damning is the fact that our nearest neighbour, the UK, came in third.

Social enterprise is already responsible for at least 25,000 jobs and €1.4 billion in economic activity, but those numbers are just the beginning. It also has the potential to address the numerous social deficits which have emerged in Ireland as a result of public finance constraints.

Ireland faces massive problems in healthcare, education, social care, the environment and many other areas.

These problems are partly the result of enforced cutbacks in public expenditure following the economic collapse of 2008 to 2010. It will take many, many years for spending to be restored, but social enterprise could address some of these issues very quickly if only it were given the opportunity.

That opportunity is being denied them by government inaction. The government first promised to introduce a national policy on social enterprise some five years ago but we have yet to see anything emerge.

It was mentioned in three of the last five ‘action plans for jobs’ but was absent in the most recent. That inaction is costing the sector dearly.

Action needed

The EU has signalled its intention to increase the total amount available to social enterprises more than fivefold to approximately €1 billion under the ‘employment and social innovation programme’.

But without a coherent government strategy and structured government supports in place, the ability of any social enterprise to secure funds from the EU is severely hampered. Some quite simple steps could be enormously helpful in this regard.

A clear legal structure for social enterprise companies would be a good start. The UK already has a model we can follow and we should do this as quickly as possible.

We could also be more imaginative in how social enterprises are treated in the public procurement process to ensure that the social benefit delivered by these businesses is factored into calculations.

Encouraging voluntary effort in social enterprises by ensuring that volunteer workers do not lose social benefits as a result of this activity would be another very positive move.

The time for debate, discussion and further promises is over. Social enterprises can help us tackle many of the issues faced by our society while creating tens or thousands of much-needed jobs for marginalised or disadvantaged groups.

The government must act – and act now.

Deirdre Kiely is president of the Institute of Certified Public Accountants in Ireland.

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