Until a few months ago, we were living in a world that was economically richer than ever. Modern economies driven by neo-liberal principles have produced economic growth at an astounding rate.
However, this has come at a high price for the environment and gross mismanagement of the distribution of wealth. World poverty statistics show that there were in excess of 686 million people living in extreme poverty.
The quest to fuel economic expansion and GDP growth produced inequality, scarring human development, creating large gaps between the wealthy and the poor, rich nations versus poorer nations.
Nonetheless, a growing positive movement was spreading throughout the world, which involved many organisations of different natures and industries operating within a sector known as the ‘social economy’. Prior to the global crisis brought about by the COVID-19 pandemic, social enterprises were generating millions of jobs spurring a wave of social innovation.
The ultimate objective of these organisations is one of mutual benefit rather than the accumulation of profit.
There is an endless list of a diverse range of examples of social economy organisations, among which, just to mention a few, are charities and philanthropic organisations, community groups, trade unions, building and mortgage societies, sports associations, hospitals, school organisations, religious groups, environmental groups, producer cooperatives and job-training organisations.
Operators within this sector demonstrate greater social justice, financial self-sufficiency and environmental sustainability. Many of them provide job opportunities to marginalised persons who would have otherwise ended up dependent on social assistance. Unfortunately, the COVID-19 pandemic, as with many other economic sectors, has slowed down this movement to almost a complete halt.
In Malta, although there are a number of organisations working in the sector, the concept of the social economy is still in its infancy. There is still a lack of a specific legal and policy framework for organisations operating within this sector.
A White Paper published in 2015 with the aim of enacting a law specifically for this sector seems to have been put on the back burner and it is not clear when this will ever see the light of the day! Sadly, this is also being noted in the ‘Malta Country Report, Social Enterprises and Their Ecosystems in Europe’ by the European Commission.
The Church in Malta has traditionally been highly active in this sector,
it commands the lion’s share of hundreds of volunteers operating in this sector. Organisations, some of which know their origins to the times of the knights, have been providing shelter for orphans and young single mothers, social housing, basic education, respite homes for people with health problems and disabilities, the elderly, and more recently food banks.
The Church and state have often collaborated on socially driven initiatives. The Church has been at the forefront in its contribution towards establishing government policies aimed at improving standards of care, education and social policies and the provision of support for the vulnerable sectors of society. APS Bank, owned by the Archdiocese of Malta, is the only Maltese bank that is a member of the European Federation of Ethical and Alternative banks.
A newly set up initiative called the Voluntary Solidarity Fund aims to generate funds towards initiatives aimed at social inclusion. However, the absence of specific legislation to regulate this sector hinders its potential.
The pandemic caught the world unprepared at a time when the political agenda was being largely dictated by populist ideologies. In our quest to recover from the devastating economic effects there will be a need for greater solidarity, especially with marginalised groups who have been hard hit by the economic downturn. Social enterprises may be the enablers of a more caring and more sustainable economy that we need to pursue.
Claudio Farrugia is a member of the Catholic Voices Network.