Social Entrepreneurship of NGOs in Poland
Krzysztof Cibor, ekonomiaspoleczna.pl
Praha, 24-02-2014

Social Enterprise – definition in Poland
• No legal definition
• Different legal forms (social coops, Vocational Rehabilitation Facility
(VRF/ZAZ), Social Integration Centers (SIC/CIS), Cooperatives, nonprofit limited liability companies, NGOs (economic activity)
• Draft of Social Entrepreneurship Act

Definition of SocEnt - Social Entrepreneurship Act (draft)
• Different legal forms (NGOs included)
• Registered economic activity
• SME
• WISE (30-50% of employees from disadvantage groups and/or – public interest services)
• Limited salaries, limited distribution of profits…
• Social Enterprise – a label not a legal form

Public interest services
• Social care
• Early education
• Mental health care
• Disabled people support

NGOs – social economy – social enterprise
Economic activity

Statutory vs. Economic activity
Payable statutory activity Economic activity
Income = costs Profits
Restricted salaries
No registration
Non restricted salaries
Compulsory Registration
Only public benefit domain Not only public benefit, profits must go to statutory activity
Payable statutory activity is rather not percieved as a social economy

Public Benefit Activity Act (2003)
• Definition of public benefit domain
• Label of Public Benefit Organization
• Economic <> payable statutory activity
• Public task outsourcing (dedicated to Non-Profits)
• Income and local tax exemptions
• Preferential access to properties maged by municipalities

NGO in PL - numbers
• Fundations (11000)
• Associations (72000)
• Volountary firemen associations (16000)
• Church organizations
About 75% of registered NGOs are active

NGO in PL – assets

NGO in PL – annual budget
10% - economic activity

NGO „enterprises” (2012)
7% - NGO Enterprises (regular, daily activity, av. 11 employees, strategies, annual budget >0,6M PLN)
19% NGOs employ people for regular contrats (av. 2 employees)
21% NGOs employ non-regular contrats workers

NGO as a „social enterprise” – different possibilities
• As NGO
• Member of coop or social coop
• VRF/ZAZ provider
• SIC/CIS provider
• Own ltd company

NGO – social coop member
• Two legal persons to set up a coop
• WISE
• After one year of employement – membership (-> lost of control)
• Profits
• Tax exemptions
• Public grants for employees

NGO – Vocational Rehabilitation Facility
• Economic activity, no separate legal personality
• WISE (more than 70% of employees - disabled)
• Profits only for rehabilitation
• Tax exemptions, public subsidies for disabled

NGO – Social Integration Center
• No economic activity, no separate legal personality
• Main goal – work training of disadvantage unemployed persons (no more than 9 m)
• Incomes from selling good and services – only for SIC
• Trained persons payed by public money

NGO – limited company
• economic activity, separate legal personality
• Tax exemptions (if non-profit)
• Different goals and groups of employees
• Public subsidies only for disabled persons
• Possibility of Public Benefit Organization label

Future/Challanges
• Social Entrepreneurship Act
• National Strategy of Development of Social Economy
(http://socialeconomy.pl/node/100)
• Economization
• Public Employement Services Act (more outsourcing for NGOs)

Thanks
• Ekonomiaspoleczna.pl
• Ngo.pl
• Socialeconomy.pl
• kcibor@fise.org.pl