Public Services (Social Value) Bill

I would be delighted. I thoroughly enjoyed the first meeting that the right hon. Lady invited me to, and I am sure that this one will be just as informative. I also thank her for reinforcing my instinct that the Government can take a lead in trying to make life simpler for all parties, not least in our role as a major funder, and to help people to reach greater coherence and consistency when working out what is worth measuring and how it can be measured by all organisations, not only those with the deepest pockets. We can make life much simpler by making better connections between those in the not-for-profit sector and those in the for-profit sector. Both groups could benefit from that. The right hon. Lady touched on this. There is an untapped opportunity here. I was fortunate earlier this week to sit down with Professor Muhammad Yunus, the Nobel prize winner and father of the microcredit. His latest initiative is a social business and joint venture with Danone to provide better nutrition for the poorest children in Bangladesh. He has persuaded Danone to come in as a partner. As one listens to how the initiative is structured, it becomes clear that here we have one of the biggest companies in the world focusing its energy on what it is really good at in order to help some of the most vulnerable and disadvantaged people in the world, and in the process it is being stretched and tested to rethink how it makes and distributes its products, so its core business is benefiting from the process. Given how rare these examples are, the opportunities are exciting. I want more corporations to see the opportunity to improve themselves by stretching themselves to apply their skills in different settings. More specifically, in this country we think that there is tremendous scope for making better connections between social enterprises, the not-for-profit sector and the traditional business community at a local level. Most of us know from our constituents—certainly mine—that we have barely scratched the surface of what we can achieve if we can make these connections work better. That involves different languages and communities, but we are interested in doing more together. It requires human interventions to make these connections work better. We are working with businesses and communities to pilot business connectors—people seconded from businesses such as Sainsbury's and Greggs—to play a community role: to find out what communities need and connect it to what local businesses say they can supply. Already I have seen in Redcar how a business connector persuaded the council to make an empty shop available to incubate five social enterprises with the support of local business—an empty shop gets used, five businesses are formed and older businesses find out much more about what their community needs. It is a win-win situation. Again, this is all new movement, new progress. The hon. Member for Harrow West mentioned the fundamental need to make it easier for social entrepreneurs to access finance. There is real momentum there, and I am happy to say that we are building on initiatives by the previous Government—for example, the enabling legislation on dormant bank accounts. That is fundamental to allowing us to do what we want to do. However, our ambition is considerably greater than that of the previous Administration, who were prepared to commit only up to £75 million to the social investment bank, whereas we are on track to capitalise that institution with about £600 million. That is a quantum leap in ambition. The momentum is there. Social entrepreneurs have been telling Governments of various hues over the years that the biggest barrier to growth has been access to finance. As we well know, the traditional world of finance in this country—the people who manage our deposits and savings—is not connected to the social sector in any meaningful way, despite the fact that we, their customers, care deeply about a number of the social challenges facing this country and would, I think, like to be part of the solution. However, we are not being presented with that opportunity at the moment. Part of our vision is to grow the social investment market—a market for money where people are prepared to blend financial return and social impact—to make a better bridge between the world of savings and the social sector. If we can build that market, we can move serious money into the social sector. Big society capital is our major intervention in that respect—it is ambitious; it is on track. It is extremely important, but it is not enough in itself, because intermediaries—the people working with social enterprises—say that there is a problem with the quality of the pipeline of deals and investable opportunities. We need to accelerate and improve that pipeline, which is why we have announced a £10 million technical assistance fund that will deliver grants to enable front-line organisations to become more investment-ready. This is all about trying to make it easier for social entrepreneurs to access capital and for savers in this country to be part of the solution to some of the social challenges that we face, and that we all want to get serious about tackling. Fundamentally, there is a cross-party consensus on this issue and the need to send a stronger signal to a risk-averse system that it is okay to innovate and to think about reconfiguring services or working with different providers. On that basis, the Bill adds value to that process and that journey. We oppose the amendments. We note that most of the stakeholders in this conversation are happy with the Bill as it stands. I urge the hon. Member for Harrow West not to press his new clause to a vote, because it runs the risk of wrecking a Bill that is a useful, incremental step. It is certainly not the end of the journey; it is a chink of light. When I took the Sustainable Communities Act 2007 through Parliament, I was clear that it was not complete; rather, it was about putting a foot in the door, confident that the door would not then be closed. From that process, the Localism Act 2011 is now on the statute book and the game has been changed. On that basis, I urge the hon. Gentleman to withdraw his new clause and allow the Bill to move to the Lords and, I hope, on to the statute book, so that we can continue on this journey.