The social enterprise sector operates at the intersection of business and social good, making it particularly sensitive to legislative changes. Recent updates in policy across various regions signal significant implications for the sector. Here’s a closer look at these developments and what they mean for social enterprises.
In February 2025, the UK will implement new public procurement legislation designed to create opportunities for a diverse range of suppliers, including social enterprises. This move could unlock new revenue streams for social ventures, especially those delivering public services. However, social enterprises must be prepared to navigate complex application processes and demonstrate measurable social impact to benefit from these changes. Capacity-building initiatives and partnerships may play a critical role in overcoming these challenges.
The UK government’s recent decision to increase employer National Insurance Contributions (NICs) has been a point of contention. For many social enterprises that rely on public sector contracts, this increase represents a significant, additional financial burden. According to Social Enterprise UK’s latest report, the rise in NICs could force some organisations to reduce their staff or even shut down. Advocacy efforts, including petitions and open letters, are urging the government to provide exemptions or additional funding to social enterprises delivering essential services.
Globally, governments are aligning policies to support green and digital transitions. Social enterprises are uniquely positioned to lead in these areas, but they require adequate support to scale their efforts. For instance, grants and subsidies for renewable energy adoption or digital transformation could enable social enterprises to reduce operational costs while increasing impact.
To thrive in this evolving landscape, social enterprises must remain adaptable. Building strong networks and engaging in policy advocacy will be crucial. Governments and policymakers must also prioritize the sector’s needs by creating funding opportunities, reducing bureaucratic barriers, and recognizing the immense value that social enterprises bring to communities.
These policy updates underscore the importance of collaboration between governments, social enterprises, and stakeholders to build a more inclusive and sustainable future.
References
Social Enterprise UK (2024) Social Enterprise Barometer: Impacts of Government Policies on the Sector. Available at: https://www.socialenterprise.org.uk
World Economic Forum (2023) Future of Jobs Report 2023. Available at: https://www.weforum.org
National Council for Voluntary Organisations (2024) Open Letter to the UK Government on NICs Increases. Available at: https://www.ncvo.org.uk
UK Government (2024) New Procurement Legislation for Public Services. Available at: https://www.gov.uk