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Shock as social enterprise closes after funding is pulled

This news post is almost 10 years old

Engine Shed to close after council pulls funding <

A leading social enterprise is to close after Edinburgh City Council pulled its funding.

Managers at the Engine Shed, which offers employment training to people with learning disabilities, said a change in the council’s funding strategy meant it will lose 40% of its funding.

Managers say the loss is unsustainable and will lead to the closure of the enterprise by March 2015, after 25 years helping hundreds of vulnerable people gain employment via innovative training programmes.

The announcement follows a consultation by the council which recommended the merger of the city’s six supported training contracts into one to focus funding towards supported employment initiatives where training is delivered on the job.

The charity admitted that the growth of the business had been far less than expected and ventures, such as it café, bakery and outside catering hadn’t been profitable enough to wean it off council funding.

We have also had to face the fact that our income generated from the sale of our products has not grown at a level anticipated in our business plan - Marian MacDonald

Marian MacDonald, the charity’s chief executive, said: “In reality, funding received from the council has decreased in value over the years due to a combination of budget cuts and stand still budgets and in fact we receive less now than we did 10 years ago.

“Alongside a steady decline in income from the council, we have also had to face the fact that our income generated from the sale of our products has not grown at a level anticipated in our business plan.”

Pre-recession figures showed 80% of Engine Shed trainees went on to paid employment.

However Fraser Kelly, chief executive of Social Enterprise Scotland, said the argument that social enterprises such as the Engine Shed were too reliant on council funding was too simplistic.

“There is a shift from supporting employability activity to supporting people in employment outcomes," he said.

“Following a progression route, as the Engine Shed does, is crucial for people who need longer term support to improve their employment prospects. On the other hand supporting people in employment (perhaps more intensively) is beginning to hold favour.

Whichever route is used by commissioners, social enterprise is as viable a business model as any other, indeed, I understand the new consortia approach involves social enterprises in it's delivery.

“What is important in all of this is that the needs of the individual are put 'first' and everything else flows from that.”

The Engine Shed was developed from the work of the Garvald Centre in Edinburgh, a community based on the principles of Rudolf Steiner providing a supportive living and working environment for people with learning disabilities.

Janice Reid, whose son Peter was given his first training for work opportunity through the Engine Shed, said the closure of the charity was a “huge loss”

“Peter wouldn’t have gained work if it for the training he received at the Engine Shed,” she said.

“It built his confidence, enabled him to make new friends and gave him an opportunity when very few were available for people with learning disabilities.”

The board of the Engine Shed said it would continue to work over the next six months to see if there was any viable way the organisation could be saved.

Cllr Frank Ross, convener of Edinburgh City Council's economy committee, told TFN supporting people into work remained a key part of the council’s ‘Strategy for Jobs’.

He said: "Last year we agreed a new city-wide employment support service to give people who have a disability the best chance of finding a job.

“This decision followed a detailed public consultation to ensure that we continue to make the best use of the council’s funding for services which demonstrate that they can support people with disabilities into work.

“The new service, which will be introduced in March next year (subject to Committee approval), is based on the principles of a new supported employment model from the Scottish Government. We have been working closely with all of the service providers, which have grant funding until March 2015, including the Engine Shed, to ensure they have been given the opportunity to be part of this new, more effective service.

"We have also met with them monthly to help ease their transition to enable them to provide people with disabilities with the best possible service to help them to find work.”



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lorraine mackenzie
almost 10 years ago
Saddened and shocked to hear this news, always had a great respect for the work that the Engine Shed did.
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charlotte bray
almost 10 years ago
This is really sad news. The Engine Shed will be a huge loss.
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