Skills for Social Entrepreneurs in the Third Sector INTELLECTUAL OUTPUT 1: REVIEW OF VET PROVISION FOR SOCIAL ENTERPRISE AND ENTREPRENEURIALISM TRANSNATIONAL LEVEL REPORT Introduction to the Skills SETS project Skills for Social Entrepreneurs in the Third Sector (Skills SETS) project is a Strategic Partnership for Vocational Education and Training funded under Key Action 2 of the Erasmus Plus Programme, which funds European cooperation for innovation and the exchange of good practices. The purpose of the Skills SETS project is to explore opportunities to identify and develop entrepreneurial skills for the voluntary and community sector at both for individual members of staff and at organisational level. The project is based around a partnership of organisations in four EU Member States Estonia, Italy, Spain and the United Kingdom operating within the context of broadly based local, regional, national and European networks of third sector organisations, with whom they work as partners, clients and service providers on a diverse range of projects and activities. The Skills SETS partners are: Eurohouse NGO, Estonia Third Sector International (3Si), Spain Fondazione Centro Studi Villa Montesca Italy DSC Regen, United Kingdom "The European Commission support for the production of this publication does not constitute an endorsement of the contents which reflects the views only of the authors, and the Commission cannot be held responsible for any use which may be made of the information contained therein."
1.0 INTRODUCTION TO INETLLECTUAL OUTPUT 1 Skills SETS incorporates a programme of desk based and primary research to develop the Intellectual Outputs that form the core content generated by the project, including reviews of relevant VET provision, case studies and policy recommendations. This document is the Transnational Level Report for Intellectual Output (IO) 1: Review of VET provision for social enterprise and entrepreneurialism. IO1 is based around National Level Reviews undertaken by each of the Skills SETS project partners designed to assess the availability and suitability of formal VET learning opportunities relating to enterprise and entrepreneurialism for individuals and organisations within the third sector with the participating EU Member States. Findings are reviewed via transnational level analysis, comparing and contrasting between each country and assessing the suitability and relevance of the available provision at local, regional and national levels, as well as in the broader European context. This Transnational Level Report summarises the findings of the National Level Reviews and provides European- Level conclusions and recommendations. It has been translated into the 4 partner languages of the Skills SETS project English, Estonian, Italian and Spanish. The National Level Reviews that form the basis of IO1 focus on identification of relevant VET courses in each participating member states and assessment of take up and outcomes in terms of total number of learners enrolled and qualifications achieved. The Skills SETS partners have also reviewed the suitability and relevance of the available provision by obtaining input and feedback from VET learners, third sector employers and local, regional and national stakeholders in relation to the suitability and relevance of relevant courses via structured questionnaires. The National Level Reviews are available on request (in English). 2.0 OVERVIEW OF PARTNER CONTRIBUTIONS DSC Regen was the lead partner for IO1 and supported the project partnership to develop agreed formats for the reports and questionnaires, with each partner undertaking the research and analysis for National Level Reports for their own countries, including: Desk research to identify the relevant qualifications available in each participating country and data relating to student enrolments, qualifications achieved and other related outcomes and results Development and distribution of questionnaires designed to obtain the views of VET learners, third sector employers and relevant stakeholders in relation to the suitability and relevance of the available provision Analysis of the responses received reviewing the scale, quality and key characteristics of VET provision in each of the participating Member States 2
2.1 SOCIAL ENTERPRISE IN ESTONIA Having regained its independence in 1991, Estonia has undergone fundamental political and structural changes over recent years. The concept of Social Entrepreneurship is still quite a new phenomenon for societies in transformation, like Estonia. Some discussion had started in the years since independence, but it was not until 2013 when the Estonian Social Enterprise Network was established that things really began to develop. Social Entrepreneurship is still a new direction for people in Estonia to consider. Most Estonians have never heard of such kind of ventures or do not know the specific definition for it. As well as this, social enterprise is not mentioned in Estonian legislation meaning that the concept seems even more obscure. So in order to inspire benevolent people to deal with social problems it is very important to advertise this kind of entrepreneurship. There is no special legal form for social enterprises in Estonia; most Estonian social enterprises are registered as non- profit associations or foundations. There are also a few limited liability companies identifying themselves as social enterprises. For achieving more favourable taxation conditions, a rather widespread solution is to combine two organizations (e.g. a non- profit association and a limited liability company) to form one social enterprise. VET Provision for Social Entrepreneurship in Estonia The review of VET provision relating to social enterprise and entrepreneurship in Estonia identified six programmes providing relevant vocational training. The approach taken was based around identifying and analysing relevant VET provision available at national level in Estonia for example the basic NGO training offered by Enterprise Estonia and then focusing in more detail on how these services are developed and delivered locally to provide VET courses in social entrepreneurship in Hiiu County, where Eurohouse is based. The only relevant Higher Education course in Estonia seems to be based at the Estonian University of Life Sciences Institute of Economics and Social Sciences and this incorporates a specific focus on social enterprise and entrepreneurship. Whilst this course is not strictly within the remit of the Skills SETS project as it is Higher Education rather than VET provision, it has been included on the basis that it provides a progression route for VET learners graduating from the other courses covered in this report. Finally, Estonia s first social entrepreneurship incubator, SEIKU located in Tartu, South- Estonia is also identified as a best practice example of innovative support for social entrepreneurs in Estonia. 3
2.2 SOCIAL ENTERPRISE IN ITALY Over the last decade, Italian society has devoted a great amount of attention to the third sector. Social enterprises have gained wider attention and now play a more significant (and increasingly autonomous) role in the Italian welfare state. In July 2014, the Council of Italian Ministers approved the draft law Riforma del Terzosettore, dell impresa sociale e per la disciplina del Servizio civile universale, which sought to redefine and reform the third sector in the country. In the context of this draft law, third sector organisations are considered to include: social enterprises, NGOs, foundations, non- profit organisations, and religious bodies, amongst others. In particular, social enterprises are viewed as entrepreneurial organisations with the aim of carrying out economic activities, with social characteristics and aims, producing goods and services having social characteristics. Co- operatives are key to the Italian social economy, and these fall into three key categories: Type A: management of social, health and education services Type B: placement of disadvantaged people in the work environment Consortia: co- operatives of co- operatives VET Provision for Social Entrepreneurship in Italy Vocational education and training for social enterprise and the wider third sector in Italy is considered to comprise of two core themes. Firstly, the concept of entrepreneurship in general (rather than just as it relates to social enterprise and the third sector within the Italian education system). Secondly, entrepreneurship education focused specifically on the third sector. Entrepreneurship education is often viewed as offering potential to be particularly effective within initial vocational training, as students are close to entering working life and self- employment may be a valuable option for them. However, in Italy there is no specific national strategy for entrepreneurship education or for technical and vocational pathways, since the most important aim is seen as being to produce skilled workers. Entrepreneurship is not included in the established national curriculum for vocational education, and apart from recent approaches in entrepreneurship education- many entrepreneurship programmes with a local/regional focus, supported by private sector and public institutions that reach a small number of students - a systematic approach and specific curricula still need to be developed in Italy, because the proportion of entrepreneurial in- school training is with 3.5% low compared to other innovation- driven economies. 4
2.3 THE SOCIAL ECONOMY IN SPAIN Following the double- dip recession of recent years, the nature of the way business is conducted in Spain has been consistently changing, in reaction to the effects the recession wrought on business and employment. In particular, there has been a flourish in new forms of social innovation and a range of social approaches to business as a result. In 2014, a report published by CEPES (Confederación Empresarial Española de Economía Social) stated that there were over 42,000 social enterprise entities based in Spain (consisting of insertion companies, mutualities, co- operatives, etc.), with over two million people either directly or indirectly employed by them; in both cases, the highest number ever recorded. However, this is not to say that the country did not already have a tradition of encouraging socially responsible business; the sixth- largest company in the nation, Mondragon, started off as a small- scale co- operative in the Basque Country and now employs over 20,000 people. And since the transition to democracy in 1975, legislative support for the social economy has become an official part of the Spanish Constitution, which states that public authorities "shall efficiently promote the various forms of participation in social enterprise and shall encourage co- operative societies by means of appropriate legislation". VET Provision for Social Entrepreneurship in Spain The review of VET provision relating to social enterprise and entrepreneurship in Spain identified a relatively broad range of training programmes covering practical and legal issues related to social enterprise, as well as smaller numbers focusing on corporate social responsibility and others offering experiential learning designed to support learners in developing business ideas. The majority of the training providers offering courses related to social enterprise in Spain appear to be business support organisations/networks focusing on social enterprise, typically operating at the regional level. Most offer courses leading to unregulated qualifications or certification, meaning that whilst they may award certificates, these are not regulated by or recognised within the Spanish qualification and curriculum framework, as would be the case for mainstream VET provision and related qualifications in Spain. Whilst some charge fees to learners ranging from 20 to 495 many are free, with a number of these being subsidised by local authorities and/or European funding. 5
2.4 SOCIAL ENTERPRISE IN THE UNITED KINGDOM The development of social enterprise activities in the UK can be traced back at least as far as the emergence of the Rochdale Pioneers in the 1840s and the cooperative movement has been a well established element of UK society and the economy ever since. During the 1970s, a new generation of political activists increasingly looked for co- operative solutions through the development of workers' co- operatives, particularly in wholefoods, bookselling and graphic design and printing. There was a further resurgence of social enterprise started in the mid 1990s with the coming together of different organisations, including co- operatives, community enterprises, enterprising charities and other forms of social business, all united by the prospect of using business to create social change. The UK is currently viewed as a pioneer of social enterprise and the associated practices of social investment and social value. The best government data estimates that there are approximately 70,000 social enterprises in the UK contributing 18.5 billion to the UK economy (based upon 2012 Small Business Survey, 2013) and employing almost a million people. Since 2005, over 11,000 Community Interest Companies have been founded, and the last five years have seen significant development of social investment to support the growth of this movement. This start- up wave is changing the nature of the social enterprise sector in the UK: almost half of social enterprises are under five years old. VET Provision for Social Entrepreneurship in the United Kingdom Based on the research undertaken, it is clear that demand for training in this field is growing, while the delivery of the courses is adapting to fit in with the constraints of time and money often cited by learners. In a recent report by the School for Social Entrepreneurs, 20% of those working in the sector had already completed an online training course, while 60% said that this would be either their first or second choice as a way to access training. However, these courses tend not to offer recognised certification, only a certificate of completion. Face- to- face tuition is still a popular way of delivering courses, but this tends to be a more expensive option. The majority of courses do not require previous qualifications; most offered are for people who are simply interested in entering the field of social enterprise or who already work in such an organisation but wish to widen their knowledge on the sector. The organisations that provide the courses are most commonly training providers specialising in social entrepreneurship such as the School for Social Entrepreneurs, Unltd.org.uk, the igenius Academy and the Scottish Social Enterprise Academy. However, there are a number of universities who host non- degree courses, such as the Angela Ruskin University and the University of Oxford. 6
3.0 NATIONAL LEVEL COMPARATIVE ANALYSIS The perception of and rate of activity within the social economy differs from country to country, which has therefore led to some key similarities and differences among the responses gathered from each partner. For example, a common theme which can be seen amongst all partner countries is the fact that social enterprise has always seemed to flourish in times of economic instability and has not been haltered, but indeed rather encouraged by the new realities, constraints and challenges posed during times of economic hardship. In addition, social enterprises in all four partner countries were often found to be relatively young companies. Even in the UK, which arguably has the longest history of social economic activity, over half of social enterprises are just over five years old. At a more concentrated level, parallels appear between individual partner countries. It is notable that in both Spain and the UK, for example, although the social economy is at a more advanced stage than that of Estonia, there are still significant differences amongst individual regions. The infrastructure supporting social enterprises in Andalusia (in the south of Spain) is much more developed than that in neighbouring regions and it is also notable that Andalusia is one of the poorest regions of Spain, with especially high levels of unemployment. Similarly in the UK, social enterprises have their greatest concentration in the areas of the greatest deprivation, with 31% of social enterprises working in the most deprived communities in the UK. In simple terms, the more deprived the area, the more likely you will be to find a social enterprise working there. This is most pronounced in the North of England and London, where 46% and 35% of social enterprises respectively work in the most deprived fifth of communities. Differences are, of course, also apparent when analysing the state of the social economy in each of the four partner countries. On a purely historical level, our research has shown that public perception and general understanding of the social economy can vary significantly between European countries, and this is demonstrated most starkly when comparing the UK to Estonia, a country where the concept has only really begun to gain more recognition in recent years. Consequently, the level to which the social economy is considered by national legislation, or if it is even considered at all, also appears to depend to some extent on the prevalence of social enterprises within the national economy, the prominence of individual social enterprise or specific social business types (e.g. social cooperatives in Italy) and the public perception of the social economy. Again, here the two cases of Spain and Estonia can be compared; while the social economy does not feature at all in the Estonia s national legislation, the concept was introduced into the Spanish constitution as far back as 1975 during the transition to democracy following the end of the Francoist dictatorship. 7
4.0 EUROPEAN LEVEL COMPARATIVE ANALYSIS On a European level, it is clear that the social economy and social enterprise play a significant role within the European economy. The third sector incorporates 2 million organisations within the European Union (i.e. 10% of all European businesses), employing over 11 million paid employees (the equivalent of 6% of the working population of the EU): out of these, 70% are employed in non- profit associations, 26% in cooperatives and 3% in mutuals. Third sector organisations are present in almost every sector of the economy, such as banking, insurance, agriculture, craft, various commercial services, and health and social services. Furthermore, the social economy and social enterprises themselves are important drivers for inclusive growth and play a key role in tackling current economic and environmental challenges. However, social enterprises in Europe still face many barriers, such as: Poor visibility and recognition of the sector Constraints of current legal and regulatory frameworks and in particular the lack of a common legal framework for social enterprise at a European level Limited financial resources Challenges in accessing wider markets, especially international markets, including within Europe Lack of business support and workforce development structures tailored to the needs of the third sector in general and social enterprise in particular. In terms of VET, the European Union has launched a number of initiatives over recent years that have worked towards developing the sector across the continent by focussing on collaboration and communication between different member states. The ultimate aim is to develop a shared strategy for VET, which should, in turn, work towards improving the availability and provision of VET courses related to social enterprise and the social economy. However, this last point is highly dependent on the individual historical and cultural experience of each member state, which is why there are differing levels of availability of such courses between the partner countries. Therefore, it is apparent that much more communication is needed between partner countries in order to build a viable common strategy for VET, and to foster the exchange of good practice and knowledge with regards to social enterprise, as some countries are much further advanced in their involvement with and encouragement of it than others. 8
5.0 CONCLUSIONS AND RECOMMENDATIONS The research undertaken by the partnership for this report has given us a strong overview of the nature of the social economy in each member state and following this, the suitability and availability of related VET courses for interested learners. The partnership has learnt that there are quite striking differences amongst the states in relation to this latter point and that these, on the whole, seem to be inextricably linked to each country s unique historical and cultural context. Comparing Estonia with the UK for example, we can clearly see that the level of opportunity to gain VET qualifications related to the social economy is highly linked to how strongly embedded the social economy is within the nation s infrastructure and public consciousness. Although the EU has been making headway in terms of developing a continent- wide approach to VET learning, more still needs to be done to make courses related to the social economy widely available and sufficiently promoted. A pooling of knowledge and resources, development of new and strengthening of existing models of social enterprise and effective client engagement will be key to continuing the growth of the social economy as well as the development of related VET courses. Deeper collaboration with stakeholders already working within the social economy namely employers, employees, volunteers and end- users - will continue to provide Europe with informed and reliable suggestions as to how this will best be achieved. The National Level Reviews have identified a diverse range of training provision in the participating Member States and, importantly, provided insights into the ongoing development of VET provision in each country. However, it is notable that this work appears to be focused almost exclusively at national level, with only limited consideration given to broader European issues. Within this context, it is apparent that many of the challenges relevant to the development of VET provision for social enterprise and entrepreneurialism are also relevant to the broader challenges facing the third sector and social enterprises in Europe. To help address these issues, the Skills SETS partnership has put forward the following recommendations for further work in this area: 1) VET providers for business occupations (as well as related organisations such as awarding bodies and regulators and agencies responsible for national qualification and curriculum frameworks) should ensure that basic knowledge of the role of the Third Sector within national and European economies, as well as of the key legal structures used by third sector organisations are incorporated as a standard element within VET courses for business occupations (e.g. business administration, accounting, finance, etc). This will help to boost the visibility of the sector amongst VET students in particular, as well as the public more generally. 9
2) Explore the potential of the European Credit system for Vocational Education and Training (ECVET) system for developing qualifications relevant to social enterprise and entrepreneurialism that would be both portable within different EU Member States and include European level content that would enable VET learners to develop their understanding of the third sector and social enterprise in other European countries. This would help to tackle the issues related to the lack of a common legal framework for social enterprise at European level by enabling learners to develop their knowledge of the specific legal structures used in different countries, thus making it easier for them to work within the third sector in those countries. 3) Provide dedicated business advice services for at national and European levels to support third sector organisations and social enterprises wishing to work internationally, especially those seeking to expand their operations to other EU countries. During the course of the research for this report, the Skills SETS partnership found that the advice services currently available for businesses seeking to work internationally are almost exclusively targeted towards large scale, private sector businesses exporting physical goods and that such advisory services have limited knowledge or understanding of the third sector. 4) Provide dedicated workforce development resources at national and European levels to support third sector organisations and social enterprises seeking to expand their operations to other EU countries a proportion of the resources for workforce development could be used to develop and fund the ECVET based qualifications recommended above. 5) Whilst it is recognised that this is beyond the remit of the Skills SETS project, our view is that the development and implementation throughout the European Union of standard company law covering the third sector and relevant legal structure and organisational forms would provide major benefits for the third sector at the European level. This would also have the benefit of simplifying the development of European level VET provision for the third sector, as well as making it easier for social enterprises and third sector organisations to expand internationally and trade and develop within Europe. 10