Social enterprise leaders warn of ‘no blueprint for Brexit’

Social enterprise organisations have responded to the result of the EU referendum with caution, expressing concern that the UK’s social enterprises – including co-operatives – are in for a...

Social enterprise organisations have responded to the result of the EU referendum with caution, expressing concern that the UK’s social enterprises – including co-operatives – are in for a “bumpy ride”.

“Our immediate worry is that social enterprises will be affected by knee-jerk reactions from the state, banks and big business,” said Peter Holbrook, chief executive of Social Enterprise UK.

“We want to avoid social enterprises facing the pinch by a combination of delays on public sector contracts, banks using the decision as an excuse to defer lending money, and for-profit private businesses seeking to keep their balance sheets looking good by squeezing their suppliers.

“In the medium term, we will see EU Social Fund spending repatriated, and it is critical that the UK government commits to maintaining or enhancing the current levels of support for people seeking employment and vocational training.” In the longer term, there are implications for public sector procurement policy and competition law, said Mr Holbrook, who explained how much of this had “been agreed at an EU level before being incorporated into domestic law”.

Co-operative apex bodies respond to EU referendum ‘leave’ vote

In a separate statement, the Social Enterprise Network (SEN) acknowledged how the sector has traditionally owed much of its success to the European Union and “the various schemes for business growth and social cohesion that have been funded from the proceeds of free trade within the single market”.

“In the wake of the UK’s referendum result to leave the European Union, SEN is in the process of trying to assess the impact that the decision may have on our sector,” said the statement.

“We will be working with our partners, members and a wide variety of stakeholders over the coming months and years to ensure that our sector, our movement, and our people make the best of the situation we are now in. That work has already started, and over the immediate period ahead we will be holding a series of events – seminars, roundtable discussions, working group meetings – to bring together social economy figures in the city region to discuss some of the issues raised and to prepare a way forward in what is undoubtedly a new world.”

After a referendum on 23 June, the UK voted to leave the European Union
After a referendum on 23 June, the UK voted to leave the European Union

There is “no blueprint for Brexit”, added Mr Holbrook. “No country has ever left the EU, so we have no real idea just how bumpy a ride the economy is in for.

“We don’t know what the constitutional implications are for Scotland and ultimately the Union. We do not know how difficult a process the negotiations with the other member states will be, nor what the results of those negotiations will look like.

“But we do know that when we polled social enterprise leaders earlier this year whether they thought leaving the EU would place their business at risk, nearly 60% said it would not – even though nearly 75% planned to vote to remain in the EU. This is reassuring but not in the least bit surprising – social entrepreneurs are nothing if not adaptable and I have faith that most leaders of social enterprises will see whatever lies ahead as a challenge rather than a threat.”

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