Social Enterprises in the Context of Social Inclusion – The Case of Serbia -

1. Social Enterprises in the Context of Social Inclusion– The Case of Serbia - Dr Marija Babovic - SeConS

2. Social inclusion Social inclusion – analytical model Financial poverty Employment Education Health Deprivation of existential needs Social participation Access to social resources, institutions and processes that enables reproduction of resources of individuals and groups in the society in a way that provides them with capability to satisfy their needs, exercise their rights and to attain at least minimum of acceptable level of living standard in particular society, as well as to participate actively in community life. SeConS - Development Initiative Group Belgrade

3. Society Markets of goods and services Existential resources Labour market Health Education Social services Community State Social inclusion as process

4. Society Markets of goods and services Social Enterprises Existential resources Labour market Health Education Social services Emerging social networks Community State Adjusted OECD model Source: OECD, 2007 Role of SEs in social inclusion process Social mobilisation Social production Civic empowerment Consumer empowerment Economic empowerment Local development

5. Mapping of social enterprises in Serbia - 2007 • Supported by UNDP Serbia and UNDP BRC • Based on EMES criteria for SEs in CEE and CIS • Conducted through very complex methodology SeConS - Development Initiative Group Belgrade

6. Mapping Methodology • Two phases: • Identification of active SEs among: - 25 000 registered associations of citizens in RSO data base (after elimination according to mission, still 8300 had to be included in short eliminatory telephone survey) - 2 800 cooperatives from ABR data base - 70 enterprises for PWDs - tracing spin-off enterprises of associations of citizens • Census of identified SEs • Outcome: - among 1900 active potential SEs in form of AoC only 142 fully match criteria - only 900 cooperatives found active - 55 enterprises for PWDs were still active - 24 spin-off enterprises were found SeConS - Development Initiative Group Belgrade

7. SE sector according to types of organizations SeConS - Development Initiative Group Belgrade

8. Main findings from mapping of SEs • SE sector is dominated by agricultural cooperatives • Sources of revenue: • majority from agriculture, retail trade, employment mediation and retraining • small share of social services, industrial and artisan manufacturing • Weak employment potential - 0.5% of total employment (cooperative members included –1.1%) • SEs still rely on external financial support • Most frequent problems: • lack of financial resources • inappropriate legal framework SeConS - Development Initiative Group Belgrade

9. SEs in light of SI 1.Small producers’ cooperatives 2. Social enterprises providers of social welfare services SeConS - Development Initiative Group Belgrade

10. Small producers’ cooperatives - significance Favourable form for small farmers, redundant workers, marginalized labour force. Economic empowerment Generation of more secure, quality, non-exploitative employment Local development Decrease of informal economy, particularly present in small farming economy Regeneration of agriculture in rural areas Civic empowerment Generation of social capital through solidarity and cooperation Promoting ideas of social justice and creating more inclusive local community. Consumer empowerment Provision of better quality products and services, or services that are demanded in the community SeConS - Development Initiative Group Belgrade

11. Small producers’ cooperatives – main policy issues Obsolete laws: FRY from 1998, RS from 1989 Inadequate legal framework Weak legal protection against illegal transfers of assets and annulment of cooperative membership Lack of institutional settings able to provide systematic and coordinated support from central policy to local actions Weak institutional support Supportive programmes not systematically included in activities of SME AgencyNES Weak capacities of Association of Cooperatives of Serbia, and local officials for agriculture and rural development Inadequate financial support Lack of state funds for cooperative programmes, lack of readiness of private commercial banks to support cooperative projects Awareness problems Negative stereotypes from socialist period, lack of information on modern cooperatives SeConS - Development Initiative Group Belgrade

12. SEs social service providers in Social policy context • Market of social services –outcome of social welfare reform • Standards of services and licensing - in progress • Emphasise on local social services • Inequalities between municipalities: • Capacities to plan and outsource/open services • Financial resources • Institutional capacity of local community (including NGOs) • Gap between urban and rural areas in availability of social services SeConS - Development Initiative Group Belgrade

13. SEs social service providers – main features • Social services’ providers – in the form of association of citizens (NGO). • High discrepancy in social activities and revenue activities among service providers: • Revenues from traditional markets (trade, restaurants, artisan production, even IT services) • Redistribution of revenues to social activities • Law on associations of citizens is obsolete, preventing them to perform revenue oriented activities on regular basis. SeConS - Development Initiative Group Belgrade

14. SEs social service providers – key policy issues • Growth of private sector (for-profit) service providers, growing competition • Clients cover costs, no state funding yet • Issues: • Private sector regulation • Easy cases/hard cases • State funding/client funding • Future of public sector SeConS - Development Initiative Group Belgrade