The Development of National Health Service Social Enterprises in England

The Development of National Health Service Social Enterprises in England

Sebrene Margaret Maher (Keele University Medical School, UK)
DOI: 10.4018/978-1-5225-6298-6.ch005


The purpose of this chapter is to examine government policy framework relating to the development of social enterprise within National Health Service providers. The number of social enterprises delivering public healthcare services is continually growing. This chapter discusses challenges and benefits for the government. Potential barriers to achieving this development are also evaluated. Although the focus is primarily upon the policy agenda in England, the chapter makes a useful contribution to the ongoing international debate on the development of social enterprises in primary and secondary care. This review identifies that National Health Service social enterprises responds to local needs, bring innovative, effective ways of managing heathcare in the community. It is clear from reviewing the literature that healthcare services are changing and being continually shaped by social enterprises providers.
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Social Enterprises can be briefly defined as organisations which commit to a clear social mission, with an element of economic activities in order to sustain and reinvest their profits to support their social mission. They are businesses that trade and use their profits to bring social, economic and environmental benefits to the wider community. Businesses with social objectives with surplus revenue reinvested into a purpose (Borzaga and Defourny, 2001). Therefore, they are designed to meet social needs as well as achieve commercial viability (Ibbotson, and Bell, 2011; Maher, 2015). Social enterprises are seen as important in rebalancing and creating a new economy that promotes economic activities that achieve social fairness, cultural fulfilment and the protection of the environment. Below are a variety of definitions which are derived from the literature.

The Department of Trade and Industry in the UK (DTI) (2002) defines a social enterprise as “a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than driven by the need to maximise profit for the shareholders and owners” (DTI, 2002;P.7). The UK government actively promotes social enterprises through devolved administrations and other UK regions. The most common activities of social enterprises include regeneration and local development, employability and management of community facilities, care for the environment, recycling, leisure and tourism, health and social care (Social Enterprise UK, 2015).

According to the European Commission (2010) the term ‘social enterprise’ is defined as an organisation which provides goods and services for the market in an entrepreneurial and innovative fashion, with the intent to allocate their profits primarily to achieve social objectives. Furthermore, the European Commission considers organisations which adopt an ownership system which reflects the enterprise’s mission of social justice as social enterprises.

The European Research Network (EMES) defines a social enterprise as an organisation which earns income through its business and strategy, in order to raise capital in support of its charitable and social mission (EMES, 2012).

While the British Council (2015) states that the term ‘social enterprise’ comprises of diverse business models in different markets but shares similar characteristics such as; a clear social purpose, generate significant proportion of their income to trading and reinvesting the majority of their profits in their social mission. In general social enterprise literature acknowledges that any kind of organisation engaged in activities of significant social value, or in the production of good and services which embed a social purpose, regardless of legal form can be considered as a social enterprise. Furthermore, alongside the social objectives the combination of trading (economic) and reinvesting profits into achieving the social objectives is a key characteristic which differentiates social enterprises from other not-for-profit organisations and private sector organisations (Austin et al 2004; Defourny and Nyssens, 2010).

Key Terms in this Chapter

Community Health Services: Community Health Services are those services delivered in the person’s own home or in a community setting such as a local health clinic, school, or care home. Community Health Services commonly include community nursing services, health visiting, physiotherapy, and speech and language therapy but in some areas also incorporate more specialist services or generic services targeted at particular groups within the population such as the homeless or those in prison.

Primary Care: Primary care services are those delivered by general practitioners (and staff based within their practices) and community-based pharmacies, dentists, and optometrists.

Community Interest Companies (CICs): CICs are supervised by the Regulator, who has the monitoring and the sanctioning power, including the power to appoint/remove a director and the power to file a petition for the winding up of the CIC.

NHS Trusts: The main organizational form through which NHS acute (i.e., hospital) and mental healthcare has been provided since the 1990s. NHS Trusts are public bodies accountable to the Secretary of State which are run by Boards of Non-Executive and Executive Members (with the Chair of the Board being a non-executive).

Primary Care Trusts: Primary Care Trusts (PCTs) were the bodies largely responsible for the “commissioning” of NHS-funded healthcare services for a defined geographic population. Commissioning was seen as a cyclical process incorporating the assessment of the population’s health needs, prioritization of the use of available resources, procurement of services from appropriate providers, and monitoring the delivery of contractual requirements. Prior to April 2011, PCTs also delivered a range of community health services. PCTs are currently being replaced by Clinical Commissioning Groups led by general practitioners.

Foundation Trusts: Foundation Trusts’ Boards are accountable not to the Secretary of State but to Governors comprising elected staff and patients and representatives from key partner agencies. Introduced in 2003, they take on the new organization form of “public benefit corporations” and are expected to have a more “business-like approach” than NHS Trusts. The current government expects the majority of Trusts to become Foundation Trusts by April 2014.

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