Increased supply

Big Society Capital Limited (BSC) is a UK social financial institution set up by the UK Government in 2011 to help finance projects under the banner of the Big Society. BSC was the world's first ever social investment institution of its kind, established by the Cabinet Office and launched as an independent organization with a ￡600m investment fund in April 2012. One year into operation, BSC’s first annual report was published in May 2013 and is available for download on the Big Society Capital website. The report notes that over ￡56 million in investment was committed to social finance intermediaries, which resulted in the funding of a range of social sector organizations. BSC's aim is to grow the social investment market. It invests in bodies that provide finance and other support to social sector organizations – making it easier for social entrepreneurs to access the capital they need, and become sustainable. And it plans to commit another ￡75 to ￡100 million in up to 20 new investments in the next financial year.

Big Society Capital Limited (BSC)

The Bridges Social Entrepreneurs Fund brings together social investors wanting to support social impact with social enterprises seeking to grow. The fund was launched in August 2009 and has raised nearly ￡12m for investment in scalable social enterprises and charities delivering high social impacts and operating sustainable business models. The fund has committed to invest ￡660 thousand fund in 10 social ventures, including 2 contracts of Payment by Results, PbR supported by Innovation Fund.

Bridge Social Entrepreneurs Fund

The Social Enterprise Investment Fund or SEIF was set up in 2007 by the Department of Health to invest in social enterprises providing health and social care services in England. The Fund aims to enhance the role of social enterprise in the provision of health and social care. The SEIF empowers local people and front line staff who want to form social enterprises to enhance their role in transforming public services in health and social care. Since it began in 2007 the SEIF has invested more than ￡110million in 650 social ventures of the health and social care sector. SEIF is managed by Social Investment Business, on behalf of the Department of Health. SEIF closely cooperates with Local Partnerships. 2012-2013 was the last year for SEIF investment application. The application is no longer accepted.

Social Enterprise Investment Fund

Increased demand

The Investment and Contract Readiness Fund is a new ￡10 million fund, managed by The Social Investment Business, on behalf of the Office for Civil Society that aims to ensure social ventures are better equipped to secure new forms of investment and compete for public service contracts. ICRF provides grants from ￡50 thousand to ￡150 thousand fund for social ventures with potential of rapid growth to compete for social investment or public service contract. The Fund has already invested ￡7.8m to support 81 social ventures that are looking to raise over ￡200m in new investment and contracts to tackle social problems and enhance lives, communities or local areas. The fund closes in March 2015 and is almost fully committed now.

Investment and Contract Readiness Fund

The Social Incubator Fund is a ￡10 million fund, set up by the Cabinet Office, that will support the development of more social start-ups across England. It will provide support to companies that help develop and grow social start-ups and social entrepreneurs. The fund invested ￡460 thousand dollars in 4 social incubators to provide space, finance support and advices for social startups. The award for the incubation application of second round was announced in early 2014. Social incubators must raise matching funding (1:1) from third party investors to ensure the investment of Social Incubator Fund. The social Incubator Fund is managed by Big Lottery Fund.

Social Incubator Fund

The Centre sits within the Social Investment and Finance team at the Cabinet Office. Social impact bonds (SIBs) are designed to help reform public service delivery. SIBs improve the social outcomes of publicly funded services by making funding conditional on achieving results. Investors pay for the project at the start, and then receive payments based on the results achieved by the project. Rather than focusing on inputs (eg number of doctors) or outputs (eg number of operations), SIBs are based on achieving social ‘outcomes’ (eg improved health). The outcomes are predefined and measurable. The Centre for Social Impact Bonds in the Cabinet Office has launched two important new tools to support the development social impact bonds: the Social Impact Bond Knowledge Box and a template SIB service agreement contract.
Social Impact Bond Knowledge Box is an online portal providing information on all aspects of developing and commissioning social impact bonds (SIBs), from identifying service areas suitable for SIBs to measuring outcomes and calculating savings. The Template SIB service agreement contract will help reduce the time and cost associated with developing the legal arrangements of a SIB.

Centre for Social Impact Bonds

The Innovation Fund is a pilot initiative aimed at testing new social investment and delivery models to support disadvantaged young people, and those at risk of disadvantage, aged 14 to 24 years through competition. The fund aims to support 17,000 disadvantaged young people within three years.

This resulted in ten SIBs in total, testing a range of social investment and innovative delivery models. The ten contracting bodies are APM UK Ltd, Links4Life Ltd, Indigo Progect Solutions, Nottingham City Council, Private Equity Foundation, Triodos New Horizon Ltd, Prevista, 3sc, T7T Innovation Ltd and Energise Innovation. The total investment from external investors is around ￡10m and the total maximum payments for outcomes amount to ￡28.4m.

Department for Work and Pensions Innovation
Fund

The Social Outcomes Fund is a ￡20m fund managed by the Cabinet Office. It is intended to deal with the main problems holding up the growth of social impact bonds: the difficulty of aggregating benefits and savings which accrue across multiple public sector spending ‘silos’ in central and local government.

The fund will be used to provide a ‘top-up’ contribution to outcomes based commissions (social impact bonds or payment by results) that are designed to deal with complex and expensive social issues. This will catalyze innovative new projects in areas where no single commissioner can justify making all of the outcomes payments, but where the wider benefits mean that a SIB is value for money. As reporting and assessment of performance data is a condition of funding, it will also generate evidence on the effectiveness of the project to overcome these barriers in the future.

Social Outcomes Fund

The Community Shares Unit, which will have a budget of ￡590,000 over three years, will be run by Co-operatives UK, a trade body that promotes cooperative enterprises, with support from Locality, the network for community-led organizations.

The unit will support the use of community shares and bonds, which allow large numbers of people to invest small amounts of capital in local projects without the costly regulation involved in a standard share issue.

According to previously released statements, the unit will aim to support 500 social ventures and back 200 share issues. It will act as a central resource for social investment intermediaries, government and other stakeholders. It will also collect data and publish best practice. The key function of CSU is to refine the market intelligence, which is the first step to improve current information.

Community Shares Unit

An enabling environment for social investment

Inspiring Impact is managed and delivered by eight organizations. Inspiring Impact aims to make high quality impact measurement the norm for charities and social enterprises by 2022. The first year project was planned and managed by New Philanthropy Capital. It developed a Code of Good Impact Practice to help organizations to find a good example and evaluate its outcome. The Cabinet Office provides ￡100 thousand over three years to Inspiring Impact. Other than that, Big Lottery Fund, London City Government, Deutsche Bank and The Diana, Princess of Wales Memorial Fund provides supports as well.

Inspiring Impact

The Global Social Entrepreneurship Network (GSEN) is a new platform, supported by the Cabinet Office in June 2013, working with social entrepreneurs around the world. It utilizes the learning, models and expertise from the UK and from all other country members who join. It will be a peer learning service for support agencies, with the potential to open out to social entrepreneurs themselves as a virtual social incubator at a future point. GSEN is incubated and guided by UnLtd.

Global Social Entrepreneurs
Network

Impact Programme aims to change the social investment market under developing countries. In future 13 years, the program will provide ￡10m social investment fund in Sub-Saharan Africa and South Asia, which will benefit more than 500,000 people with low income and lower-middle income, to access them to affordable goods, services and employment opportunities. Its purpose is to invite capitals from private sector as a demonstration of long term feasible social investment.

Impact Programme

SITR is designed to support charities and social enterprises in accessing certain debt and equity finance from individual investors by offering 30% income tax relief. It is available for investments made on or after 6 April 2014 and is modelled on the existing Enterprise Investment Scheme.

Tax relief for social enterprise investment

Good regulation is a good thing. It protects consumers, employees and the environment; it helps build a more fair society and can even save lives. But over the years, regulations – and the inspections and bureaucracy that go with them – have piled up and up. This has hurt business, doing real damage to our economy. And it’s done harm to our society too. When people are confronted by a raft of regulations whenever they try to volunteer or play a bigger part in their neighborhood, they begin to think they shouldn’t bother.

If we want to reverse this trend and encourage greater responsibility in our society, then we have got to trust people and give them more freedom to do the right thing. So this government has set a clear aim: to leave office having reduced the overall burden of regulation. The Red Tape Challenge was introduced to give business and the general public the opportunity to challenge the Government to get rid of burdensome regulations, to boost business and economic growth and to save taxpayers money.

On 27 January 2014, the Prime Minister announced that we had achieved the target of identifying 3,000 pieces of regulation to be scrapped or improved, with the help of input from the public, business, and other organizations through the Red Tape Challenge. By January 2014 we had already abolished or simplified 800 regulations.

Review of regulatory barriers to social investment

The CITR scheme encourages investment in disadvantaged communities by giving tax relief to investors who back businesses and other enterprises in less advantaged areas by investing in accredited Community Development Finance Institutions (CDFIs).

The tax relief is available to individuals and companies and is worth up to 25% of the value of the investment in the CDFI. The relief is spread over five years, starting with the year in which the investment is made.

Community Investment Tax Relief (CITR)

An enabling environment for social development

The ￡3.2 billion Regional Growth Fund (RGF) supports eligible projects and programmes that are also raising private sector investment to create economic growth and lasting employment. Selected bidders must draw down their grants between 2011 and 2017.

Rounds 1 to 5 of the RGF have supported 430 projects and programmes across England – allocating ￡2.9 billion of government support. We project this to deliver 573,000 jobs and ￡16 billion of private investment between now and the mid-2020s.

To date companies have drawn down ￡876 million of RGF support, delivering nearly 86,000 jobs and ￡2.3 billion of private investment.

Regional Growth Fund

We set up the Business Finance Partnership to invest ￡1.2 billion in increasing lending to small and medium-sized businesses from sources other than banks. This money is being matched with at least an equal amount from private sector investors and will be invested on fully commercial terms.

The scheme provides start-up finance and advice for 18 to 30 year olds. The scheme started in September 2012 and will provide ￡82.5 million to young entrepreneurs.

It’s run by the Start-up Loans Company (a government-owned organization) and offers young entrepreneurs money to start their businesses (seed capital) of around ￡2,500 each.

This scheme is a public/private programme which provides venture capital investment for early-stage, innovative small and medium-sized businesses with high growth potential. The scheme started in 2006 and we’ve made a further ￡200 million available.

We’ve launched 12 funds since 2006 and invested more than ￡160 million in companies.

Business Finance Partnership(BFP)

Funding Central is a free resource for charities, voluntary organizations and social enterprises. We list thousands of funding and finance opportunities, plus a wealth of tools and information supporting you to develop a sustainable income strategy.

Funding Central is managed by the National Council for Voluntary Organizations in partnership with Idox Information Solutions Ltd and is funded by the Office for Civil Society.

Funding Central

An Act to require public authorities to have regard to economic, social and environmental well-being in connection with public services contracts; and for connected purposes. This act is expected to provide social ventures connect to contracts, thus public authorities are better accessed to creative contracts.

The Public Service(Social Value) Act 2012

The aim of the act was to devolve more decision making powers from central government back into the hands of individuals, communities and councils. The act covers a wide range of issues related to local public services, with a particularly focus on the general power of competence, community rights, neighborhood planning and housing. The key measures of the act were grouped under four main headings;

new freedoms and flexibilities for local government
new rights and powers for communities and individuals
reform to make the planning system more democratic and more effective
reform to ensure decisions about housing are taken locally.

Localism Act: right to bid and to challenge

The Social Investment Business has ￡10m in grants as part of the Community assets and services grants programme made available by Department for Communities & Local Government to help citizens with feasibility studies or the initial setup of the service. This grants programme is available for organizations using the Community Right to Challenge and for the running of local services more broadly.

Community Right to Challenge and Community Ownership and Management of Assets Support Programmes

What is the right to provide?
Evidence shows that staff-led enterprises bring many benefits, including reduced absenteeism
and increased productivity1
. They also give front line professionals greater freedom to personalize and improve service delivery to the public, particularly to individuals and communities at the margins of society. Staff-led enterprises can improve staff and community engagement. The right to provide builds on the successful right to request scheme in community health services, which will see almost 25,000 NHS staff involved in the creation of social enterprises that will deliver high quality services.
The right to provide supports and enables staff working in health and social care to ultimately develop staff-led enterprises to deliver more flexible and responsive services, whilst having ownership and real influence in the way the service develops. As discussed later on, the right is to present to your board your proposal for a staff led enterprise and to seek approval to develop a full business case to test your proposal. If the business plan is then approved, you will be able to set up a staff-led enterprise. How this right applies to different NHS and social care organizations is described below. Staff-led enterprises have an important role to play in meeting the Government’s commitment to improve choice and quality in the delivery of healthcare services. The right to provide enables staff to consider a wide range of options, including social enterprise, staff-led mutuals, joint ventures and partnerships. Their freedom to innovate and respond to service user need will put them in a strong position to drive up quality and improve health outcomes.

Right to Provide

Mutuals Support Programme, a new support to help staff-led mutual organizations set up and spin out from the public sector, has been unveiled. The new ￡10 million Mutual Support Programme (MSP) will provide business and professional services to groups of staff or existing mutual organizations. The support programme is made up of the Mutuals Information Service website and hotline, and the funds. PA Consulting, leading a consortium of experts in employee ownership, will manage the mutuals information service hotline that will provide advice and support to fledgling mutuals. The MSP funding, administered by the Cabinet Office will purchase HR, legal, financial, tax and business planning services to develop the most promising new mutuals.

Mutuals Support Programme

The financial co-operative is one of 31 credit unions across Britain to sign up to the ambitious Credit Union Expansion Project which aims to attract up to a million more people into credit union membership. The project is being managed by the Association of British Credit Unions Ltd (ABCUL) and has attracted Government investment of up to ￡38 million.

Credit Union Expansion Project

The Merlin Standard has been designed to recognize and promote sustainable excellence within supply chains and provide guidance to those seeking to achieve it. It is built upon four fundamental and integrated principles; supply chain design, commitment, conduct and review. These principles have been designed to examine key areas of the relationship between a prime contractor and its supply chain partners.

The aim of the Standard is to encourage excellent supply chain management and within this to ensure fair treatment of partners and subcontractors by Prime Contractors, to support development of healthy, high performing supply chain.

The Merlin Standard