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The social economy brings new business to France – and Europe

18/02/2013 The social economy brings new business to France – and Europe

Already very developed in France, the social economy is highly relevant for the EU’s Europe 2020 strategy.

In the framework of PROGRESS (Peer Review in Social Protection and Social Inclusion programme) France hosted a Peer Review entitled ‘Social economy – laying the groundwork for innovative solutions to today’s challenges’ in Paris on 10-11 December 2012. Representatives from ten Member States (Bulgaria, Cyprus, the Czech Republic, Germany, Greece, Hungary, Malta, the Netherlands, Romania and Slovenia) and from two European stakeholder organisations (Eurodiaconia and FEANTSA) as well as French experts and officials participated.

Cooperatives in France are serving as business incubators. Just part of the country’s thriving social and solidarity economy.

As a translator and language teacher, Nadja Berrebi used to have five or six different contracts, and she was not being paid on time. Then she heard about the COOPANAME cooperative in Paris. She brought several clients with her, and COOPANAME has helped her to contact others and set her own pay rates. “It gives me both autonomy and great security,” she says. The ideal combination for any business start-up. It also provides free training, for example in IT, and a ready-made network of other services.

COOPANAME’s deal with each of its members is that they draw a wage from their own activity or from an activity shared with others. That wage is to be in proportion with the amount of activity they bring into the cooperative. In return, COOPANAME helps each member to carry out the activity they wish, in the way and at the pace that they wish, in cooperation with whomever they wish.

Like France’s other Business and Employment Cooperatives, COOPANAME enables people to test a product or service while retaining employee-style social security through a special “employee entrepreneur” status. These schemes are just one part of the country’s flourishing social and solidarity economy. The sector accounts for nearly 10% of French GDP and over 13.3% of the country’s private employment. Strongly rooted in services, social action, financial activities and education, it is one of the most dynamic parts of the French economy. In 2008-9, the social economy grew by 2.9% and created more than 60,000 paid jobs. Over the same period, the rest of the private sector shrank by 1.6% and the public sector by 4.2%.

Peer reviewers from ten EU countries visited Paris in December 2012 to see the social economy in action and probe its significance for the rest of Europe. In fact, France is already closely in step with the EU on this. Across Europe, the social economy is a force for innovation, and it delivers better social outcomes. Hence its relevance to the EU’s Europe 2020 strategy. This calls for a smart, sustainable and inclusive economy, promoting employment, productivity and social cohesion. The Europe 2020 flagship initiatives “Innovation Union” and “Platform Against Poverty and Social Exclusion” make social innovation a priority.

Europe’s social economy has pioneered the creation of new markets and new jobs and it is a major contributor to the European social model. It clearly promotes sustainable development and social inclusion, which are major aims of the Europe 2020 strategy. So the EU is keen to expand its already strong support for this sector.

Dating from 2011, the Social Business Initiative is an EU-level action plan to facilitate social economy enterprises’ access to finance, raise their visibility and improve the legal framework for them. Meanwhile, the European Social Fund has been supporting the social economy for more than 50 years now. The new draft European Social Fund regulation will incentivise social innovation and transnational cooperation through a higher co-funding rate. And it includes a new specific investment priority for the social economy. Drawing together three current programmes, the draft EU regulation on the Programme for Social Change and Innovation provides for a budget of some EUR 960m over a six-year period. At least 17% of this will be earmarked for social policy experimentation – including the vitally important social economy.