Big Society Capital Response
Alastair Davis (SIS)
Social Investment Scotland has been watching Big Society Capital in recent weeks and months with a considerable degree of interest and indeed, are actually quite excited by the possibilities that this new source of capital may bring for Scotland. Whilst much of the detail has still to be sorted out; and the brand has some negative connotations as a result of its association with a particular political ethos; the finance that it will offer presents huge opportunities and is a natural next step for the social investment marketplace. Having attended the launch by the Prime Minister last week, the motives of those in charge seem sincere and we remain open minded.
Social Investment Scotland has been operating in this space for some time, and despite it taking some time for the sector to get used to the idea of repayment finance, taking on a loan is no longer as undesirable as it may have been in the past- the demand for the Scottish Investment Fund alone is perhaps a sign of this. Whilst grants will always have a place- and Cohen and O’Donohoe acknowledge this themselves- there are a growing number of organisations who have the ability to achieve their own self sustainability through the generation of their own income whilst achieving sustained and significant social impact. SIS will continue to support them in their efforts but seek to develop new innovative new finance models that sustain and enhance this impact. It may be that these models- or even these organisations- do not exist at the moment, but what capital, like that offered by BSC does, is provide the opportunity for this innovation to flourish. Of course, the beauty of repayable finance is that this capital can then be recycled again and again and again, to provided continued and sustained support to communities that need it most.
Remember that part of the total investment capital of BSC is money that has been invested by the four Merlin banks- two of which have a strong Scottish heritage. We have an opportunity in Scotland to invest “our share” of this money, in line with the needs and aspirations of our country, rather than merely replicating what comes out of London. Watch this space!