The Office for Civil Society is planning to announce a foundation with “more than £100m” to grow charities’ abilities to win contracts and take on social investment, Rob Wilson, the new minister for civil society, has said.
The foundation will receive at least £60m of funding from money repaid from the Futurebuilders loan fund – an investment which was previously announced in June by then-minister Nick Hurd.
Wilson has said the foundation will now also have cash from the Big Lottery Fund and will work in partnership with social investment wholesaler Big Society Capital.
However neither of these bodies has confirmed what funding and support they will be providing. The Big Lottery Fund has said it is involved in discussions over the fund but will not make a formal decision until January. Big Society Capital said it does not give grants, but that it is working with the OCS to establish the foundation and will provide loans alongside it.
Wilson said he cannot confirm exactly what the fund will do, or what its name will be. It is also not possible to confirm how the £100m will be distributed, including whether it will all be grant funding directly to sector organisations, whether some will go to intermediaries working with charities, or whether some will be in the form of loans.
However, he has said its work will be based on the Investment and Contract Readiness Fund (ICRF), a grant fund administered by the Social Investment Business on behalf of the OCS.
The ICRF model involves sector bodies working with expert adviser bodies to bid for cash which they use to grow capacity to bid for investment and contracts.
In a speech last Tuesday, Wilson said: “We’re putting at least £60m over the next decade into a new foundation to increase access to the social investment market.
“These funds will help build the capacity of charities and social enterprises looking to take on social investment, learning from the success of our Investment and Contract Readiness fund, which has already unlocked £20 for every £1 of government grant.
“And this £60m is working in partnership with the Big Lottery Fund and Big Society Capital to create a foundation with more than £100m to grow this area of the market.
In an interview with Civil Society News on Friday, Wilson said: “There is a new fund we haven’t announced yet, it’s still with policy at the moment. There is going to be a £100m fund, which includes the £60m Futurebuilders repayments, and some of the rest will come from the Big Lottery Fund.”
He said the new £100m fund would be additional to the £40m Local Sustainability Fund (LSF), which was also announced by Hurd earlier this year and is currently awaiting Treasury clearance.
Wilson said the LSF is intended to “help charities and social enterprises articulate their core offer, reduce running costs if needed, and to explore different ways of diversifying their income”.
