Social Enterprises Contributing Pounds 2.1bn a Year to Welsh Economy; Challenges for Sector Highlighted

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Byline: Si'n Barry

THE social enterprises sector in Wales is generating revenues of more than pounds 2bn a year, research commissioned by the Wales Co-operative Centre reveals.

The extensive mapping exercise provides a greater understanding of the contribution of the sector to the economy, with a view to it shaping Welsh Assembly Government and public sector support policies.

In total there are just over 3,000 organisations undertaking social enterprise in Wales.

The research, by the University of Glamorgan, estimates that the social enterprise sector contributes 2.6% (pounds 2.1bn) to the turnover of all enterprises in Wales.

A social enterprise is defined as a "business with primarily social objectives, whose surpluses are principally reinvested for that purpose, rather than being driven by the need to maximise profits for shareholders."

Social enterprises in Wales vary in size, with the largest being notfor-profit water company Glas Cymru, which generates nearly a third of the total of the sector's turnover. Social housing ventures are also a major contributor with their contribution estimated at 26% of turnover.

However, the research shows that one third of social enterprises are very small with an annual turnover of less than pounds 25,000.

Almost two-thirds are registered charities or have charitable status.

The report estimates that social enterprises account for 28.533 full-time jobs and 204,512 part-time - with a further 104,677 volunteering opportunities.

Larger social enterprises, with annual turnover of more than pounds 500,000, are more likely to be involved in housing (24%), healthcare (11%) and recycling (10%).

Cardiff contains 22% of all large Welsh social enterprises (more than pounds 1m turnover), but its share of the small enterprises is much less at just over 6%.

More than a third (36%) of social enterprises provide services within an area of 10 miles, with just one in eight providing services across Wales.

And the majority are profitable. Some 55% of those interviewed for the research said they had made a surplus in the last financial year, while 48% intend to increase their proportion of earned income in three years' time.

More than two-thirds want to provide more or new services to the public sector.

However, the research shows challenges remain for social enterprises in trying to win more public sector contracts. The main is a belief that public sector bodies have a lack of awareness and misplaced perceptions of the sector. Fewer than 20% of organisations interviewed have registered with the Welsh Assembly Government's sell2Wales tender opportunities service.

In terms of support from the Welsh Assembly Government the highest response (22%) was for greater promotion and recognition of social enterprises, while 17% want more direct funding. …