Government versus social enterprise: comparing the quality of government-run and social enterprise spin-out organisations in English health and social care

Abstract

This paper examines what happens to performance when public services transition to social enterprises that combine a public social value focus with private commercial revenue generation. We focus on England’s health and social care sector, which has seen the transition or ‘spin-out’ of some government-run services into social enterprises with the goal of combining high-quality services with a business focus that would allow them to be more efficient, flexible and innovative. Drawing on 2017 English Care Quality Commission (CQC) data, we use ordered logit multi-variate regression to compare quality ratings of government-run providers and social enterprise Community Interest Companies (CICs) while differentiating spin-out and non-spin-out CICs. Our study shows that services spun out into social enterprise CICs did better overall across all CQC quality ratings than government-run services; however, they did not perform as well as independently established CICs. We draw on and contribute to publicness theory to explain divergent performance across these organisational models and provide important information for policymakers deciding where to direct limited public funds for health and social care.