The cost of living, social enterprise and looking forward 

Posted: 16 December 2022, in Blog

2022 has been dominated by the cost of living. 

Just like many individuals, families and communities, social enterprises have been struggling. The spiralling cost of doing business has been affecting the delivery of products and services in a variety of complex ways. 

The situation has different operational impacts on social enterprises, from utility costs to transport, food, the payment of the real living wage, buildings, facilities and insurance costs, recruitment and more.  

Social enterprises often have the added challenge of improving the lives the most excluded groups in society and it’s clear that the most excluded people are being hit disproportionately by the crisis – this then further increases costs for social enterprises. 

We must also take into consideration the real impact on the mental health of individuals, families and social entrepreneurs as a direct result of the cost of living crisis.  

This is all alongside the ongoing and long-term financial impacts of the lockdown period that is still affecting the planning and the sustainability of many social enterprises.   

Despite these many challenges, Social Enterprise Scotland believes strongly in solutions. 

We’ve been working on a range of support interventions and we’ve examined and analysed what’s currently happening at the front line within the social enterprise community. 

We began by creating a resources page of support on our website. 

We then hosted an online session, open to all social enterprises, with around 50 organisations in attendance. We heard directly from social enterprises about how the cost of living is impacting them – and then fed this back to government. 

Since then, we’ve conducted a survey that was again open to all Scottish social enterprises, to ask directly how key aspects of the crisis was affecting them.  

Some of the feedback we’ve received is about a lack of clarity and information regarding where to turn to for help (our website support page includes The Scottish Government dedicated online resource that anyone can access). 

There’s certainly been a lot of feedback around a feeling of helplessness and being overwhelmed, as well as uncertainty around how long the situation might last. 

We’ve heard several shocking stories on skyrocketing energy prices for organisations that have become all too familiar. This means that longer-term planning and development is difficult and reserves are being used up. 

This is at a time when demand on services is increasing and when the volunteer pool is dwindling due to the cost of living. 

We’ve been in conversation with The Scottish Government about what additional, practical support might be provided to our business community.  

Our most recent work was organising a Cross-Party Group on Social Enterprise, meeting in The Scottish Parliament on a cost of living theme.  

On the plus side we do have a strong precedent for substantial and rapid grant support due to the Covid lockdown period, with evidence that this can effectively reach organisations. 

There are also good examples of organisations coming together in partnership to share resources and knowledge and jointly access support. 

We must also ensure that local anchor organisations like local authorities, housing associations, the NHS, big businesses, universities, and others are coming together to provide more effective solutions. 

While it may be very difficult to appreciate it right now we also have, for example, free healthcare and free public transport for younger and older people. This is just some of the existing support that is helping to mitigate inflation. 

Indeed when we take a step back and begin to ask some key questions, we can begin to see some of the emerging solutions that are possible. 

Is there scope for more collective purchasing of services? Would resilience training help? Can national funders do more? What are other countries doing better? Is it time for Universal Basic Income? What about the Scot Gov Minimum Income Guarantee? 

We fully understand the urgency and the stress being caused by the cost of living and doing business. We’ll continue to campaign hard for better financial and business support for all social enterprises in Scotland.  

But at the core of our social enterprise community is innovation, flexibility, a spirit of partnership and a solutions mindset. We believe that, just like the Covid lockdown period, that we’ll emerge from this stronger and more resilient.  

Social Enterprise Scotland will support our members and help empower them to thrive in 2023 and beyond. We’ll choose to approach the coming year with optimism and a new way of thinking that unlocks social enterprise potential.  

Duncan Thorp, Policy and Public Affairs Manager, Social Enterprise Scotland