The Prince Update - March 5th
Our writer Richard Prince shares his regular horizon scan of the sector news, flagging up developments, new funding and opportunities in the social sector for portfolio careerists and others to be aware of.
eBay to invest in small businesses which support disadvantaged communities
eBay UK has announced a three year multi-million pound training and finance support package for retail businesses within the social enterprise sector. The ‘eBay for Change’ programme aims to create jobs and opportunities in marginalised and vulnerable communities which have been hardest hit socially and economically by COVID-19 by helping to grow community based businesses.
eBay has partnered with Social Enterprise UK and the World Fairtrade Organisation to give global shop fronts to small businesses who reinvest their profits back into their communities here in the UK or abroad. ‘eBay for Change’ will be a hub on eBay UK connecting its 29 million UK shoppers with these small businesses each with a clear social mission. As the programme ramps up in the coming months, up to 50 businesses will start trading on the hub with this number expected to grow significantly as it scales.
In addition, eBay UK is investing in growing the social enterprise sector through a new partnership with UnLtd providing training, coaching and financial support.
No plans for more emergency funding for charities by government
Charity leaders have been pushing for further grants to support the sector, but Baroness Barran, minister for civil society, said that there were no plans for “another dedicated package”. The minister said: “The government really did do what we could to protect the work of charities over the last year, whether it was giving charity workers key worker status from the get go, allowing volunteering through the pandemic, and obviously the £750m was the first targeted package which was announced by the government, as well as obviously all the cross-sector schemes.”
Government will work with social enterprises on Covid-19 recovery
Social enterprises have a “huge opportunity” to deliver public services as the country recovers from the pandemic, according to civil society minister Baroness Barran. Speaking to the Social Investment Commission, Barran said that mid-sized social enterprises could help deliver work in areas like healthcare and job training, where the government planned to spend “a great deal of money” in the years ahead. The minister also cautioned social investment leaders against over-estimating the amount of money available from dormant asset funds.
Lloyds Bank Foundation opens new £9.5m fund
Small and local charities in England and Wales helping people overcome complex social issues can now apply for two-year unrestricted grants of £50,000 from Lloyds Bank Foundation for England and Wales. At least 25% of all funding this year will be allocated to charities led by and for Black, Asian, and Minority Ethnic communities, building on the Foundation’s commitment to racial equity as outlined in its strategy. The funding will be open year-round, meaning charities can apply at a time that suits them and will not be restricted by deadlines.
SIB blog - Swapping debt for equity can aid the UK’s economic recovery
Many businesses have taken on significant levels of debt to stay afloat – in part through government guaranteed lending schemes, as well as rent holidays and other commercial loans. Further pressures are emerging, including the need to repay VAT and other deferred taxes, loan repayments, and the reintroduction of business rates; not to mention the substantial unsettled rent debt from Covid crisis period. A variety of proposals have been mooted to ease the debt burden for smaller businesses – but there is potential for social investment to play a pivotal role in shaping the response to this issue. The scale of government-backed lending presents a rare opportunity to utilise debt-for-equity swaps that could considerably expand the social economy by transitioning at-risk, yet viable, private enterprises to employee or community ownership at scale.
Comment: An interesting proposition for what risks becoming a serious problem of debt-trapped SMEs
Former minister criticises government over social investment
The government does not understand the social investment market, said former civil society minister Nick Hurd. He told the Social Investment Commission that Whitehall departments still do not “get” the social economy, and that the ambitions he set out for the social enterprise market a decade ago have not been realised. Hurd was the minister responsible for civil society from 2010 to 2014, and led the government’s work to create Big Society Capital (BSC) in 2011. “I think there are people inside DCMS [the Department for Digital, Culture, Media and Sport] who get it but, with the best will in the word, and they’d be the first to admit it, that is not the most powerful department in government
NPC Evaluation: Better lives for older people
Octavia is a not-for-profit organisation which provides thousands of people in London with quality, affordable housing. It offers a wide range of support to older and vulnerable adults living in its homes, including helping people to stay active, independent and a part of their community. In particular, Octavia’s outreach, befriending and activities services for older people provide practical help to isolated individuals, regular and ongoing companionship from trained and dedicated volunteers, and group social activities that connect people with their peers. NPC’s evaluation of these services strengthens Octavia’s evidence base and will inform future decisions on creating better lives for older people
Comment: interesting and practical example of using Theory of Change
The 2021 Spring Budget – what did it mean for our sector?
Here are some of the main announcements affecting charities:
· The government’s Coronavirus Job Retention (furlough) Scheme, which has been used by thousands of charities, will be extended until September. Employers would be asked to pay 10 per cent toward the costs of furloughed employees in July, rising to 20 per cent in August.
· Extension of Social Investment Tax Relief (SITR) to 2023 is a big win for the sector after concerns that SITR would be axed and will help to unlock further capital for investing in the social economy.
· A new £150m Community Ownership Scheme will offer match-funding of up to £250,000 for people to purchase local assets of value to their community, such as pubs or Post Offices.
· An extra £300m will go into the government’s £1.6bn Culture Recovery Fund, designed to help arts and cultural organisations through the pandemic. There will also be a further £90m for government-sponsored museums and cultural bodies in England.
· Charities that run shops or other retail schemes could be eligible for “restart” grants of up to £6,000 to help them reopen.
· There will be an additional £19m to support domestic abuse programmes and £10m to support armed forces veterans with mental health issues.
· The government will extend the apprenticeship hiring incentive scheme in England to September and increase the payment to £3,000.
But charity sector figures have strongly criticised the government for the lack of sector-specific announcements in the Spring Budget, for example:
Vicky Browning, chief executive of ACEVO said: “The government is taking the charity sector for granted. Since the first day of the first lockdown the government has relied on charities for help delivering food, medical care, mental health support, and housing support.
Charity Finance Group: “Government has once again failed to recognise the vital role civil society plays. Deliberate and continued refusal to support social change organisations delivering public benefit leaves our sector precariously balanced on the cliff edge of rising demand and reducing income.”
NPC: There is still time for this to change' Leah Davis, head of policy at NPC, said: “This was meant to be a budget for the post-Covid-19 era, yet for all the innovation, infrastructure and investment to get our economy moving, we saw nothing comparable for solving the deep social problems we face.”
Paul Johnson, director of the Institute for Fiscal Studies: Mr Sunak had three challenges in this budget – to ensure the right level of support for the economy over the next few months, to set about fixing the longer-term public finances, and to deal with the longer term consequences of the pandemic, especially its unequal consequences.
· He has done a decent job of the first, arguably erring on the side of generosity.
· He has given us a sense of where he wants to go on the second, but he still has a lot of work to do and his spending plans in particular don’t look deliverable, at least not without considerable pain.
· On the third he has been silent. No money to deal with post-pandemic priorities. No policies to deal with the inequalities that have opened up over the last year between rich and poor, old and young, more and less well educated. This is a big hole in the chancellor’s and the government’s policies, a hole which needs to be filled and soon if we are not to suffer a much worse hangover from this crisis than need be the case.
https://www.civilsociety.co.uk/news/charity-sector-voices-disappointment-at-budget-2021.html
https://ifs.org.uk/budget-2021
Nesta unveils new ten-year strategy
The innovation funder Nesta will focus on childhood inequality, public health and a sustainable economy, under a ten-year strategy recently unveiled. Nesta said it aimed to “change the lives of millions of people” through its work over the next decade.
The strategy paper, Nesta’s Strategy to 2030, said that its success depended on developing “strong working relationships with families, frontline workers, service delivery organisations, policymakers and academics”. Nesta spent just over £27m through its charitable programmes last year, according to the latest filings with the Charity Commission.