Amid the vibrant hubbub of Social Enterprise Day, the Government today backed social enterprise as the model to show how business with a conscience can be done. The Minister for the Third Sector, Kevin Brennan, spent the day experiencing the energy and innovation of the social enterprise movement. Most recent estimates suggest there are at least 55,000 social enterprises in the UK, contributing 8.4 billion to the UK's GDP and employing at least 650,000 people*.

Setting out new milestones in government policy, he said: "This government, from the Prime Minister down, is passionate in its enthusiasm for the social enterprise movement. As everyone starts to feel the effects of the global financial crisis it is clear that there is a growing market place for alternative business models, which hold social and environmental value to be every bit as important as financial gain.

"The action research projects we are announcing today show cross-government support for social enterprise. Our work on Social Return on Investment will create new momentum for third sector organisations to prove how effective they are."

At the "Blazing A Trail" lunch reception for social entrepreneurs and young people whose lives have been transformed by social enterprise, held at the Cabinet Office's Admiralty House, the Minister announced:

* Four brand new action research projects by departments across government are to be funded by the Office of the Third Sector in the Cabinet Office to the tune of £740,000 over three years. The projects will galvanise government action to test social enterprise solutions to the challenges we face.

* Departments involved are: The Department of Health (DH), the Department for Business, Enterprise & Regulatory Reform (BERR), the National Offenders Management Service (NOMS) and the Department for Communities and Local Government (DCLG).

* A new project to help measure social value in a way that everyone can understand. It is aimed at making social return on investment (SROI) accessible, affordable and a well understood route for articulating the social value organisations create. This should to help everyone involved to make better decisions. A consortium led by SROI UK has been appointed to carry out the three-year project, which will run alongside a complementary project funded by the Scottish Government.

* The results of two successful pilots which showed that investors are willing to consider the social and environmental implications of their investments. The work suggests a way forward to a marketplace where both investors and the firms in which they invest understand products capturing social as well as financial returns.

At the end of a full day spent taking in a diverse range of events designed to raise the profile of social enterprise, the Minister commented: "Social Enterprise Day has been tiring but tremendous fun. At South Bank Mosaics in south London, I have seen how the homeless and those who have been in prison can re-engage with society through a social enterprise that creates amazing public artworks. I have met young people from the inner city facing a prosperous, fulfilling future because Sam Conniff at Livity or Tokunbo Ajasa-Oluwa at Catch-22 showed faith in them.

"All in all, this has been an inspirational day. Economic and financial uncertainty present challenges to us all, but more than ever our country needs social enterprise to blaze a trail. There are opportunities for those with the ideas, drive and courage to put the good of society alongside the benefit to themselves."

Communities Secretary Hazel Blears said: "Social enterprises make a huge difference to our communities. As we enter tougher economic times, they are more important than ever.

"That's why I'm making sure that my department does all it can to support them, open new opportunities and help them grow."

Secretary of State for Business, Peter Mandelson said: "Increasingly young entrepreneurs are looking beyond the balance sheet and establishing enterprises with a conscience that directly benefits their communities.

"UK social enterprise already contributes £8.4bn each year to our GDP and it is a sector which is steadily growing."

* 2005 Small Business Survey - BERR