Portugal: social enterprise, a cornerstone for inclusive prosperity?

In Portugal, the tension between social welfare and fiscal constraint is a tightrope stretched over a chasm of political crisis, which has haunted the nation for centuries. The traditional option for maintaining political stability is autocratic dictatorship, which was finally rejected by the Portuguese people during the ?Carnation Revolution? of April 1974. Alarmingly, in a recent public poll contest organized by the public broadcasting station RTP, citizens voted the last dictator Salazar, as the ?Greatest of Portuguese?. The survival of democracy in Portugal depends on its ability to effectively and quickly reconcile the pressing dilemma between social and economic priorities.

One of the regular sources of contention between the Portuguese government and its citizens is the on-going reform of the National Health System. The Portuguese NHS is struggling to meet the present demand, especially in the face of increasing budgetary constraint and chronic institutional inefficiencies. Centralised rigidities weaken its capacity for tailored responsiveness at the local community level, and for adapting to the new demands of a fast approaching tsunami, of demographic and health-determinant change.

Social enterprises for healthcare

The populations most at risk are the demographically expanding patient groups of the elderly, the chronically ill and those in need of end-of-life care. In accordance with European policy, based on recommendations by the World Health Organisation, the Portuguese government has instituted a programme to move the locus of care for these patient groups from the acute hospital setting to the primary care level in the community. This programme (RNCCI – Rede Nacional para os Cuidados Continuados Integrados), seeks to integrate the provision of healthcare and social services, through the establishment of a multi-agency network of providers at the primary care level, including non-governmental organisations.

A review of the Portuguese NHS, which was published by the World Health Organisation in 2004, expresses the underlying concern of many Portuguese citizens: ?that most of the reforms [in the Portuguese NHS] were only legislative, and lacked substance in practical execution.? Unless there is genuine reformation in the relationship between the Public and Civil sectors, so that a greater equalisation arises regarding their respective roles (as per the UK model), the risk of the RNCCI programme also failing is quite high.

The creation of genuine Third sector enterprises within the framework of the present RNCCI programme, for delivering community based and domiciliary care services, could provide considerable returns on investment for Portugal; not only to satisfy the social need within prevailing cost constraints, but to lay the foundation for a more innovative and productive Portuguese economy.

Partnership between the Private and Third sectors

This will require a strong partnership between the Third and Private sectors. According to recent studies, collaboration based on a transfer to the Third sector of business know-how and joint-investment from the Private sector, results in valuable Private sector gains, including: the development of new business models for the provision of innovative goods and services, better market insights, reduced risks, as well as more committed and enthusiastic employees; all resulting in greater productivity and profit.

To prepare the way for the development of a strong and active Portuguese Third sector, a supporting framework of measures needs to be considered, for example: the use of social enterprises as a practical training environment for the next generation of Portuguese Private and Public sector leaders; the creation of a specific NGO to promote and develop the activities and role of the Portuguese Third sector; the establishment by national government of an agency modelled on the UK government?s Office for the Third Sector; and productive collaborations between the Private and Third sectors, facilitated through Corporate Social Responsibility organisations and programmes.

According to a recent study by the respected UK consultancy firm SustainAbility, the greatest challenge to social enterprise development is the lack of an adequate social banking sector. What is needed is the provision of financial services tailored to the specific requirements of the not-for-profit sector. At present the overwhelming proportion of philanthropic support is in the form of grants. A more credit orientated approach would promote greater access to more funding. It would also ensure the financial sustainability of social projects, through the development of an enhanced entrepreneurial capability. As the well-know maxim shows: teaching a man how to fish, and giving him the means to start, is always a more effective, ennobling and lasting solution, than merely giving him a fish whenever he is hungry.

The author of this article is Raymond Aitken, from the Portuguese NGO, AMARA. Email: raymond.aitken@amara.pt Website: www.amara.pt