Growing Up and Getting Tough: Why the CIC Association Is Going Direct to Government

In September 2002, the Strategy Unit report “Private Action, Public Benefit” outlined the concept of the Community Interest Company for the first time. The stated aim was to widen and deepen the enterprise culture, so that regardless of their background or circumstances, everyone has the chance to go as far as their talents will take them.

On March 26th 2003, Patricia Hewitt stood alongside the DTI, the Home Office and the Treasury to publish a joint consultation document. “The CIC,” she said, “will create a strong new brand for social enterprise and a new marketplace for social investment.”

The legislation passed into law in July 2005. Five years on, there are more than 4,200 CICs on the register, ranging from £100 individual startups to multi-million pound healthcare providers employing hundreds. They’re being used by charities, local authorities, community groups and individuals across every sector. CICs have flourished from the Shetland Isles to the Scilly Isle, with activity spanning art to zoology.

On the face of it, all seems rosy on planet CIC. But dig a little deeper and some tough questions emerge. At the risk of encountering the well-oiled PR machines that have supposedly been aimed at me for some time, I’m sticking my head above the parapet to say something that needs to be said.

CIC has been failed by the support structure it was born into. Most notably by the Social Enterprise Coalition.

Social enterprise was given the first new company legislation in nigh on 150 years. And despite the millions that have been invested into social enterprise by the previous government, virtually nothing has been spent on developing CIC infrastructure in five years. No accurate, detailed information for professionals and business advisers. No research and development to establish the viability of packaged CIC investment products. Nothing.

I get phone calls almost daily from CICs or potential CICs of all shapes and sizes, and the quality of advice they receive is variable to say the least. CICs have flourished in spite of the indifference to doing anything tangible, not because of it.

By way of example, look at the Social Enterprise Mark. It came into being after the CIC legislation. It has received nearly £1 million of taxpayers’ money in total. It has fewer than 300 members. Before it received its latest round of funding, we asked for the opportunity to present a case as to why investing in CIC infrastructure instead would create more bang for the taxpayer’s buck. We were rolled over. Just as I was previously rolled over when I asked the SEC to help us build some funding bids in 2008. I’m happy to provide full copy of all correspondence if needed. There’s a lot of it.

I don’t say any of this lightly. I would have preferred to discuss all the positive development we’re achieving at the Association instead. We’ve built a membership of 788 CICs from an £8,000 starting grant. We’ve developed a data system that tracks creation rates, survival trends, and regional distribution. We’ve established media partnerships, academic collaborations, and a growing library of practical resources.

But I don’t want to be played for a fool again. Having this discussion in public will, I hope, help us all draw a line in the sand, learn the lessons, and move forward.

The CIC legislation was a landmark achievement. It’s the most significant development in company law for social purpose in generations. It deserves a support structure that matches its ambition. It hasn’t had one. And the body that was funded to provide one — the Social Enterprise Coalition — has, in my view, failed in that responsibility.

That’s why the CIC Association is now preparing to bid for a strategic partnership directly with the Office of Civil Society. We believe we can deliver better value, better outcomes, and better representation for CICs than the existing infrastructure has managed. We’ve proved what we can do with £8,000 and no staff. With proper backing, there’s no limit to what the CIC community can achieve.

I would urge anyone who shares our vision to come to www.cicassociation.org.uk and get involved. If you can help us develop, if you have experience in bid-writing, policy engagement, or sector development — we want to hear from you.

The next five years will determine whether CICs fulfil the promise that Patricia Hewitt articulated in 2003. I intend to make sure they do — with or without the support of the established infrastructure.

The Association has grown up. And it’s getting tough.