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Let’s work together to help the Big Society Bank get it right

The Big Society is big news at the moment. With Nat Wei shrinking his involvement and Liverpool City Council terminating theirs, David Cameron this week re-launched his vision live on television.

And on the same day the Cabinet Office announced its social investment strategy. It comes a week after the banks said they would provide £200m of finance for the Big Society Bank. It’s all quite exciting, really. At least it would be, if we had a clue.

Amid the hype, spin and general furore, it’s hard to work out what is going on and what the Big Society really is all about.  But it seems to me that there are two key strands – the community aspect and the Big Society Bank.

The community aspect is about asking us to step up to the plate, volunteer by running schools, shops and health centres etc. We are all expected to do our bit in these austere times. The PM is clearly trying to recreate the Dunkirk spirit in us.  His passion and commitment is not in dispute. But the reality of it all may be very different.

I began volunteering at the age of 15 and am a real advocate for what it can do for the volunteer as well as the beneficiary. But it is not for everyone. Volunteers need time, energy, commitment and the right skills for the job.  I strongly suspect that almost all the people who want to volunteer are already doing so in some form or another.  So, talk of scaling up and replicating projects by getting everyone involved may be somewhat ambitious.

And then there is the Big Society Bank.  There is no doubt that putting unclaimed assets to use is a great idea.  And that designing a range of financial instruments for social enterprises is also a positive move.  As is the BSB being a wholesaler to current players in the market.  And the investment of private finance that it intends to raise is equally important.

What causes me concern is the market development aspect.  Unless the market is developed appropriately, it will not be able to use the products or absorb the capital.

In my experience the social enterprise/civil society sector needs more support, capacity building and growth before it can take on this type of finance. The £200m from the banks will be ‘permanent capital’ provided on commercial terms – how all this will work is yet to be clarified – but there is a real danger that it is too much too soon. We need to get the supply and demand aspects balancing together, a real trick in any industry, but particularly in an industry that has the balance of social and financial goals as an inherent tension.

In the end it is all about supplying the right type of finance on the right terms at the right time. Let’s work together and make it happen.

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