Dormant assets could unlock £1bn to boost social enterprise and level up communities, coalition tells UK government

Social Enterprise UK and Big Society Capital are among nine organisations promoting the Community Enterprise Growth Plan, described as a “once-in-a-decade opportunity” to help accelerate the growth of social enterprise in underserved communities.

Nine UK social economy organisations have united to urge the government to use dormant assets funding which could potentially direct £1bn to left-behind communities.

The government is expected to launch a consultation this summer on how to use £880m of additional funding from dormant assets that have been unlocked by a new law passed in February. 

The coalition, which includes Social Enterprise UK and the UK’s social investment wholesaler Big Society Capital, is backing the Community Enterprise Growth Plan, a series of recommendations on how to use dormant asset money to grow social enterprise in left-behind communities in order to help “level-up” the country. 

The best way to level up the country is to grow social enterprises. We know it works

The plan would use £50m of dormant assets funding per year over 10 years – a total of £500m. By leveraging philanthropic and private capital alongside the dormant assets funding, the plan could “double the amount” of money available to £1bn, the coalition claims.

Victor AdebowaleVictor Adebowale (pictured), chair of Social Enterprise UK, said: “The best way to level up the country is to grow social enterprises. We know it works… We have the formula, but we need the next round of dormant assets to accelerate the growth of social enterprise and level-up even faster.”

He continued: “Central to this has to be reaching out to parts of our society which have struggled to get access to finance and support in the past. We need more black-led businesses, more women-led businesses and more [businesses] led by people with disabilities.”

Other organisations involved are the Access foundation, UnLtd, Social Investment Business, the Impact Investing Institute, the School of Social Entrepreneurs, Power to Change and Navca. 

The coalition’s proposal would use a portion of the total dormant assets funding available and the coalition “fully expects” and “would encourage” other causes to be supported as well, a spokesperson for the coalition told Pioneers Post.

We have the formula, but we need the next round of dormant assets to accelerate the growth of social enterprise and level-up even faster.

Tried and tested solutions

The plan proposes to use the money to back existing, “tried and tested” solutions to increase access to adequate capital for social enterprises, encouraging the growth of trading income through match-trading schemes, and providing specialised business support. 

The measures recommended in the plan include using a blend of grants and loans to improve access to capital for smaller ventures; providing “start-up” funding for a Black-led social investment fund, as recommended by the Adebowale Commission earlier this year; supporting community development finance institutions; and encouraging social enterprises to grow their trading income through match-trading initiatives and business support.

Nick Temple, CEO of Social Investment Business, said the plan was a “clear and ambitious proposal for dormant assets funding that will build on proven work and ensure money gets quickly to the people and places that need it most.”

 

Once-in-a-decade opportunity

The dormant assets scheme has used money from dormant accounts to support social and environmental initiatives across the UK since 2011. 

Until now, the scheme was able to use funds held in banks or building society accounts whose owners couldn’t be tracked down and that hadn’t seen any activity for more than 15 years. More than £800m of those funds has been invested so far, including £425m used to establish Big Society Capital in 2012. 

The Dormant Assets Act 2022, which became law in February, expands the scope of the scheme to some insurance policies, pensions, investment and wealth management and securities, making an estimated additional £880m available. The government is expected to undertake a 12-week consultation this summer on how to use the new money.

Peter HolbrookPeter Holbrook (pictured), CEO of Social Enterprise UK, said the plan was “a smart way to deploy limited funds to support social enterprises in places that need them.”

He added: “This consultation marks a once-in-a-decade opportunity to decide how we use hundreds of millions of pounds to help communities. We must use this precious resource wisely.”

  • Jane Hanson, the chair of the Reclaim Fund, which administers the dormant assets scheme, was awarded a CBE last week as part of the Queen’s birthday honours, for her services to the charity sector.

 

Top picture: Dot Dot Dot is a social enterprise that provides housing to property guardians in homes that would otherwise stand empty. The residents keep the property secure and benefit from inexpensive housing; in return, they commit to volunteering for good causes in their community for 16 hours a month. 

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