Fund chief’s parting shot at CDFIs
One of the UK’s leading pioneers of community finance announced his retirement this week and issued a parting warning that the fledgling industry could ‘wither on the vine’ unless further public funding is found to nourish it.
Roger Brocklehurst, chief executive of the Local Investment Fund (LIF), will retire from his post this month. Brocklehurst joined LIF in 1997 and is widely known for being a key figure in the development of UK community finance, which exists to support businesses and social enterprises operating in the country’s poorest areas.
Looking back over his seven years in the industry, Brocklehurst said that while ‘great progress’ has been made in supporting the development of community development finance institutions (CDFIs) in the UK, the Government risks undermining the sector unless it extends the Phoenix Fund or replaces it.
The Phoenix Fund was created to help support the community finance industry until it becomes self-sustaining, but the fund is due to be withdrawn in two years.
Brocklehurst said: ‘Having established the industry, it is vital that the Government doesn’t allow t a thousand shoots to wither on the vine. It’s a long march to develop a self-sustaining industry like this -and there’s still a lot of the long march to go.’ LIF has already begun research into the possibility of creating a wholesale fund to support the other CDFIs should the Phoenix Fund end, Brocklehurst said.
Brocklehurst will be replaced by Mike Baker, who joined LIF earlier this year to manage its involvement with the Adventure Capital Fund. Baker has 30 years’ experience with NatWest Bank and has been a board member for King’s Cross single regeneration budget (SRB) programme for seven years.
Echoing Brocklehurst’s fears, Baker said: ‘If the Phoenix Fund simply ends in two years it will leave many CDFIs at half or one-third the size that they need to be to become self-sustaining.
That defeats the object of establishing the industry in the first place’ Last month the Community Development Finance Association (CDFA) warned in its annual report that more public funding is needed to ensure its long-term survival. Speaking this week, Bernie Morgan, chief executive of the CDFA, said: ‘The Government has said that when the Phoenix Fund ends it will be up to the regional development agencies to pick up support for CDFls. But RDAs have their own targets and priorities, and without dedicated support from the public purse we will be left exposed.’
Source: Regeneration and Renewal magazine, www.regenerationmagazine.com