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Social economy

The notion of social economy, also referred to as solidarity economy, is one of the most controversial terms in Poland. Attempts are in place to characterise it and define it in various aspects. There are definitions created through indication of the legal and organisational forms that are specific for social economy (legal and institutional approach). Some also define this term through identification of common rules characterising various entities participating in social economy (normative approach). Jacques Defourny and Patrick Develtererecognised the following rules specific for social economy entities:

  • precedence of providing services to members or community over profit;
  • autonomic management;
  • democratic decision-making process;
  • primacy of people and labour over capital during profit sharing.

Such a rooting in the world of values and principles had been consciously exposed in the Polish Social Economy Manifesto of June 2008, where solidarity was underlined as one of the binding agents specific for the area known as social economy. Not only is it solidarity among people, but also a foundation of the economy of the Republic of Poland under the constitutionally defined social market economy.

Social economy is deeply rooted in Polish tradition and history. This is indicated by the names of its advocates: Stanisław Staszic, father Piotr Wawrzyniak, Edward Abramowski, father Wacław Bliziński, Maria Orsetti, Stefan Żeromski, Stanisław Wojciechowski, Teodor Toeplitz, Franciszek Stefczyk, Romuald Mielczarski, Jan Wolski, Stanisław Thugutt. „Społem”, Liskowa or Warsaw Housing Cooperative initiatives not only constituted social innovations, but also built a new binder of the society where all citizens were equal.

Undoubtedly, social economy may form one of the material components of the European Social Model and Polish social policy. Obviously, it will not solve all social and economic problems, but it might find an important place in the new social integration policy, i.e. the process where entities, environments and societies at risk of poverty and exclusion obtain new opportunities and resources necessary for full participation in economic, social and cultural life and to keep the living standard at the level considered normal in a given society.

One should keep in mind, though, that social economy entities have a much broader context:

  • they are in line with the idea of building a participatory democracy and social capital through the new vision of social order and social integration of local communities. Combination of the value of solidarity and individual economic involvement might, albeit not necessarily, build a new active formulae of local participation, mobilisation of the local community to joint actions in support of a fuller fulfilment of the needs of residents, launching reciprocity mechanisms, building the basis for social solidarity and acting for the common good, which contributes to the development of social capital at the local level. The role of social economy might be analysed here at two levels:
  • Individual level, when employees of social enterprises, thanks to their employment, improve their social skills, network, enter new interactions, which enables them to build social capital, both their own and their enterprise’s. It must be kept in mind that according to CBOS survey of February 2012, over one half of respondents (55%) claimed they knew no one with whom they could run a business. Readiness to start up such cooperation was declared by two-fifths of respondents (40%)
  • social level – the activity of a social enterprise may tighten the connections between local actors, build civic society, improve citizens' confidence in public institutions;
  • they might for a component of employment increase policy through filling in the local area with regard to social services and enabling employment of groups that are particularly at risk on the labour market. With the creation of new jobs and active approach of social economy entities and social enterprises to the issue of activation and support for disadvantaged persons, social economy creates actual opportunities of permanent activation, self-independence and social and professional integration. It is particularly important in the context of relatively low efficiency of the social support system currently in place in Poland which, although modified and improved, is assessed as reinforcing the dependency and passivity. Employment in a social enterprise may modify this model, turning current clients of social support institutions into partners who actively strive for the improvement of their lives. Two key types of entities and social enterprises may be distinguished here: the integration profile and the service profile in the area of public benefit;
  • they form an important instrument of the process of social integration, which creates revaluation of professional and social roles through building communities based on solidarity instead of dependency. The effects of employment in social economy are not only professional activation, but also improve quality of life of the employees, i.e. empowerment, better self-assessment and ability to self-define, greater satisfaction, higher self-esteem. Such changes may translate into further social benefits, such as lower health care expenses or lower frequency of occurrence of family issues;
  • through ensuring better use of local resources, enhanced competitiveness of local economy and building social cohesion at the local level, they might provide public benefit services to satisfy important needs that local communities cannot satisfy themselves. This involves in particular care services – there is a growing demand for them in Poland and the ageing society will only increase it. It is necessary to increase the supply of those services, not only for the elderly, but also for children, the disabled and other groups; health care, educational, cultural and environmental protection services; collective utility services, reciprocal services – enterprises operating on the market and competitive mostly due to their nature, such as mutual insurance, health care services, telephone cooperatives etc.;
  • they also form an instrument of development of the local community, providing inexpensive public benefit services to citizens. The key to success of social economy is to perceive the social economy entities and social enterprises as components of a broader network of public, private and civic entities. Social economy entities may lead to mobilisation of local resources, improved competitiveness of local economy through the development of networking and cooperation, reduced operating costs, delivery of goods and services to local entrepreneurs, as well as local community. It should be noted here that social enterprises may also constitute an important source of innovation, both in economic and in social terms. They might become a stimulus for local economy in a given area. Social economy entities may also generate increased income of members of local community through the improvement of local demand for goods and services.

The abovementioned benefits connected with the development of social economy are intertwined, complementary and enhance each other. Firstly, a subject of social economy and a social enterprise, rooted in the network of local connections, might become an effective tool for initiating and supporting mechanisms of local development, thus contributing to the improved welfare of the members of local community and supporting the fuller use of available resources at the local level. Secondly, a subject of social economy and a social enterprise with stable economic foundations might provide an actual opportunity to enter the labour market and to improve the future of persons at risk of social exclusion. Thirdly, it might provide socially useful goods and services, thus generating additional social benefits. It might also contribute to the development and reinforcement of the role of social capital.

Team for systemic solutions in the field of social economy

Pursuant to the Order of the President of the Council of Ministers No. 141 of 15 December 2008, the team for systemic solutions in the field of social economy was established. In September 2012, the Prime Minister signed an Order that extended the composition of the team. The team is intersectoral and interministerial.

The tasks of the team include:

  • preparation of the draft programme for the development of social economy,
  • development of a draft act regulating social entrepreneurship,
  • development of proposals of financial solutions regarding the operation of social economy entities,
  • preparation of a proposal of measures in the system of education and training with regard to social economy, which would cover formal and non-formal education,
  • presenting opinion on draft government documents, draft strategies and national programmes, as well as proposals of EU regulations regarding social economy.

The team for systemic solutions in the field of social economy consists of four working groups: legal group, educational group, financial group and strategic group.

Integrated system of support to social economy

On 11 March 2010, an agreement on co-financing of the systematic project entitled “Integrated system of support to social economy” was signed, to be implemented by the Human Resources Development Centre.

Measure number and title: 1.2 System support to institutions of social assistance and social integration

Project No.: POKL.01.02.00-00-005/09
Project title: “Integrated system of support to social economy”
Beneficiary name: Human Resources Development Centre
Beneficiary’s seat: Warsaw
Project value: PLN 55,993,558.89
Value of co-financing: PLN 55,993,558.89
Date of execution of the agreement: 11 March 2010

Partners:

  1. Barka Foundation for Mutual Help
  2. Foundation for Social and Economic Initiatives (FISE)
  3. Cooperation Fund FoundationInstitute of Public Affairs (IPA)
  4. Malopolska School of Public Administration Cracow University of Economics (MSAP UEK)
  5. UNDP in Europe and CIS
  6. National Auditing Union of Workers’ Co-operatives (NAUWC)

The project is aimed at increasing the level of development and improving the condition of social economy in Poland through construction of permanent, institutionalised mechanisms of essential support for social economy entities and their environment.

The project includes activities relating to the construction of support infrastructure for social economy entities. This involves establishment of the Social Economy Centres, which carry out networking activities, and support by means of a grant fund. Standards of exiting economic passivity of persons excluded from the labour market were developed and implemented under the project. With regard to improved competences and enhanced potential of the staff of social support and integration institutions, various forms of education are organised, such as post-graduate studies, courses, training, study visits, internships and consultancy services. Moreover, activities aimed at raising social awareness of the possibility to solve problems with the method of partnerships for social economy have been initiated, along with media campaigns and other activities that create a positive image of the social economy “brand”.

The project is addressed to social support and integration institutions, labour market institutions, non-governmental organisations and social economy institutions, as well as to the employees of the abovementioned institutions and public administration operating directly in the area of social support and integration.

The activities under the project include construction of a nationwide system of coordination, support, training and monitoring for social support and integration institutions, as well as for regional institutions from the social economy sector. 6 educational and advisory centres (Social Economy Centres) will be established, and a curriculum regarding social economy at the post-graduate level will be developed and implemented at 3 universities. It is expected that 800 persons will complete post-graduate studies, 400 public institution employees will be trained, 4,000 consultancy hours will be dedicated to social economy entities, 2,000 persons will participate in the seminars/local meetings regarding social economy, 750 persons will be trained with regard to local partnerships, including a specialist internship, 150 persons will participate in five-day internships, 498 persons will participate in the study visits in Poland and abroad, 6 entities will be awarded in the competition for the best social enterprise, and 150 local initiatives will receive financial support from the grant fund. 

A social cooperative is a new entity in the Polish legal system. Its aim is not to run a joint business in the interest of its members, as it is the case with regular cooperatives, but rather to run a joint enterprise on the basis of the personal labour of its members to achieve professional and social integration.

A social cooperative is an institution which runs business that combines economic and social objectives, gathering persons generally at risk of social exclusion, who, jointly and on the basis of their personal labour, run an enterprise and implement the objectives of a social and professional reintegration of its members. Moreover, a cooperative may also run a social, cultural and educational activity for its members and for their local environment, as well as a public benefit activity regarding public tasks referred to in the Act on public benefit and volunteer work.

Profit is not the aim as such in those enterprises, it is an instrument aimed at achieving the highest aim, i.e. the social aim.

The main act of law regulating the activity of social cooperatives is the Act of 27 April 2006 on social cooperatives (Dz. U. of 2006 No. 94 item 651 as amended). The Act lays down the rules of establishing, operating, connecting and liquidating a social cooperative.

Social cooperatives create an opportunity for effective solution of problems of persons who face the greatest difficulties with functioning in social and professional life (including mainly on the labour market). The Act complements the existing regulations regarding social and professional reintegration. It provides conditions for the creation of new social and economic entities which will become alternative job opportunities for persons in need of social integration. Members of a social cooperative create jobs for themselves, thus ensuring income for themselves and for their families, and through joint activities, they change themselves and the environment they live in – they create something that becomes their common good, for which they are responsible. To this end they must cooperate, learning how to maintain interpersonal relationships and how to perform social roles. They also acquire skills which in the future might enable them to gain professional independence.

A social cooperative is established and operates due to:

  • joint business running,
  • inclusion of cooperative members in social and professional life,
  • reconstruction of their ability to create and maintain relationships, at work, in the family and in the local community.

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