CIC AssociationCIC

In Sep 2002 the concept of the CIC was outlined in the Strategy Unit report “Private Action, Public Benefit”

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. Government wanted to support SMEs and social enterprises to modernise and reform the delivery of services, regenerate disadvantaged communities and spread enterprise culture.

On publication of a joint DTI/Home Office/Treasury consultation document on March 26th 2003 Patricia Hewitt said ‘The CIC will present new opportunities for social enterprises to benefit the people they serve: Easy for investors to understand, with an assured lock on profits and assets to attract social investors, it will help create a strong new brand for social enterprise and a new marketplace for social investment’.

Passing into law in July 2005, numbers have grown quickly with over 4200 currently on the Regulators register, ranging from £100 individual start ups to multi million pound healthcare providers employing hundreds. It’s being used by Charities, Local Authorities, Communities and Individuals up and down the country across all sectors and activities, and its potential to expand the social economy is being realised daily.

Taken at face value all seems to be 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 that CIC has been failed by the support structure it was born into, most notably by the SEC. Social enterprise was given the first new company legislation in nigh on 150 years, how have they nurtured it?

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, be that accurate and detailed information for professionals and business advisers, or research and development to establish the viability of packaged CIC investment products. 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, which came into being after the CIC legislation. It has received nearly £1million pounds of taxpayers money in total, has less than 300 members and is a complete and utter shambles. Before it received its latest round of funding we asked the SEC and the OTS for the opportunity to present a case as to why investing in CIC infrastructure instead would create more bang for the taxpayers buck and social enterprise in general, but were rolled over, as I was previously 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, and would have preferred to discuss all the positive development we’re achieving at the Association instead. However, I don’t want to be played for a fool again and feel having this discussion in public will help us all draw a line in the sand, learn lessons and move forward. I hope it will also provide context to our decision to bid for a strategic partnership with the Office of Civil Society, and I would urge you to come to cicassociation.org.uk if you can help us develop the infrastructure to enable CIC to do more for the social economy.

Basic Incorporation statistics

Average number of applications received per month 2005-10 Period	Applications received	Monthly average
Jul 05 – Mar 06	260	28
Apr 06 – Mar 07	719	60
Apr 07 – Mar 08	873	72
Apr 08 – Mar 09	1,209	100
Apr 09 – Mar 10	1,572	131