UNISON Barnet: Future Shape of the Council Programme – Briefing No. 7, The impact and performance of management buyouts, social enterprises and mutual models

There is renewed interest in management buy-outs (MBOs), social enterprises, the ‘John Lewis’ model and other mutual forms of ownership as an alternative to outsourcing or ‘partnerships’ with private contractors. The Briefing draws on historic and recent evidence. These options transfer a service from the public to the private sector and is thus privatisation. The form of private ownership, for example whether it is a public or private company, a cooperative, mutual, social enterprise or some other non-profit organisational model is a secondary matter. The fact of the matter is that the ownership of assets and employer responsibilities will transfer to the private or voluntary/third sector. A procurement process will still be required, irrespective of an MBO or social enterprise option. However, the MBO/social enterprise option effectively means that there will be NO in-house bid.