At an event to launch Big Society Capital’s (BSC) first Annual Report, Nick O’Donohoe, CEO, outlined a number of proactive initiatives for 2013 to drive the development of the social investment market in the UK.
Since our launch we have been grappling with the question of what being a ‘social’ business means and how it can be evidenced to various stakeholders that have different definitions, motivations and priorities. We have attempted to define the ‘unregulated’ social sector in our governance agreement, but along with other social investors, grant makers and commissioners, we know that we need to do more in developing our understanding of this area so that we can build a diverse market that provides appropriate financing to a range of social organisations, and ensure that social impact is not restrained by legal form.
The Government’s commitment to establishing a social investment tax relief is an extremely timely initiative with the potential to transform the social investment market. However getting the terms of the tax relief right will be essential and there are some critical issues that still need to be addressed if it is to be effective.
Big Society Capital welcomes the Government's commitment to establish a social investment tax relief. We believe it is an extremely timely intiative with the potential to transform the social investment market.
The first Social Impact Bond focused on early intervention to prevent young people becoming NEET (not in education, employment or training) has exceeded its Government target for the number of low attainers achieving five A*-C grade GCSEs by more than 80%.
Big Society Capital (BSC) believes forthcoming reforms to probation services have the potential to expand the role of social sector organisations in the criminal justice sector. There are details about the reforms that remain uncertain, including the final payment mechanism itself. But as long as the eventual market both incentivizes lower reoffending, and ensures appropriate transfer of risk and reward down the supply-chain, social sector organisations will be well placed to do more, and in turn there will be greater demand for social investment.
We expect the formal competition process for the new probation services to begin in the next couple of weeks. We set out below the main options for social sector organisations looking for social investment to support their participation in this competition.
Northern Rock Foundation and Big Society Capital haveannounced their intention to create a £11.5m social investment fundfor the north east of England to support the development and expansion of voluntary and community organisations and social enterprises. This will be the first regional fund of its kind to be set up with Big Society Capital support.
One of Big Society Capital’s key objectives is to increase the flow of capital into the social investment market and in particular to attract greater and more diverse sources of finance into the sector. As part of the market building effort to meet that objective we hope to encourage the launch of social investment products suitable for both retail and institutional investors.
This year, as part of his presidency of the G8, the Prime Minister hosted the Social Impact Investment Forum. Here you can watch the footage from the event on 6th June 2013, including contributions from David Cameron, Sir Ronald Cohen and Nick O’Donohoe.
Public servants who form ‘John Lewis style’ mutuals to take control of their services need better access to external finance if they are to transform public services, a report published today argues.
The Boston Consulting Group report, ‘Soft Finance, Hard Choices’, analysed the performance of 71 mutuals, which currently deliver £1.2billion of public services, as well as 15 mutual projects in development. It found clear evidence that mutuals are improving service quality and driving innovation. It also showed that they are performing well as businesses with the 62 mutuals launched since 2010 generating substantial growth and creating as many as 3,000 new jobs.
Strength and diversity are key to our vision for the social investment market. A new report released today co-commissioned by Big Society Capital provides evidence that although we are one step closer to reaching this vision, there are still some challenges ahead.
The UK social investment market grew by up to a quarter to £202 million per annum in 2011- 12 through an estimated 765 deals, according to a new report published today (3rd July).
Growing the Social Investment Market: The Landscape and Economic Impact, authored by ICF GHK in association with BMG Research, has been jointly commissioned by Big Lottery Fund, Big Society Capital, City of London Corporation and Her Majesty’s Government. The research finds that over the lifetime of their finance period, these 765 social investments resulted in the creation or safeguarding of 340 UK social ventures, 6,870 UK FTE jobs and £58 million in GVA contribution to the UK economy in gross terms.
A new report from The Young Foundation, supported by the Private Equity Foundation and Big Society Capital, says the £2.5 billion a year pupil premium is not being used effectively to raise the educational performance of the UK’s poorest pupils – and calls for social investment to be used to develop and deliver programmes with greater impact.
This week, in the lead up to the GB Summit in Enniskillen, Prime Minister Cameron will convene key global leaders from government, civil society, and the private sector to evaluate the potential and practicalities of using "social impact investing" to tackle significant globalchallenges. We urge the world to take notice of this positive development.
At the world’s first G8 conference on social impact investing Prime Minister David Cameron today reinforced the UK’s commitment and leadership in growing the global social investment market, which already creates jobs and growth in the economy and tackles entrenched social problems whilst saving money for the taxpayer.
- UK hosts inaugural G8 conference on social impact investing
- Prime Minister announces £250m to help communities purchase local assets
- London Stock Exchange backs the world’s first Social Stock Exchange
We have just updated and published BSC’s investment policy and launched a “Social Impact Tests and Thresholds Assessment” document. Together, the documents should clarify our three investment objectives of social impact, contribution to market development and a financial return. The investment policy document also sets out some of our key investment conditions and outlines our investment process.
The educational attainment gap is one of the UK’s most pervasive problems. In spite of improved general educational attainment over the last decade, the number of young people, particularly those from socially deprived backgrounds, leaving secondary school without any qualifications or unprepared for the world of work has increased.
This paper revisits the question of whether the current social finance model fits the needs of community-based social enterprises, examining the question from the perspective of an experienced finance professional.