Supporting The Third Sector and Social Enterprise
Within our communities, the third sector and social enterprises play a crucial role – supporting community development, inclusive growth, and providing lifeline services, facilities, and employment. A thriving third sector and growing volunteering is vital to Scotland. Its economic and social contribution is vast and as such it is an essential partner to Government. The Scottish Government invests around £500 million annually in the third sector, leveraging a turnover estimated at £6 billion in normal times. However, these are not normal times and the trading environment for social enterprise in particular has been severely constrained during the crisis.
Beyond the immediate need our role must be to create the best conditions for the third sector and volunteering to thrive and contribute to a recovering economy and society. As we move from the immediate response to recovery we will now refocus part of the Communities Fund into a £25 million Community and Third Sector Recovery Programme. This will include business support and investment to help organisations adapt their operations and income generation to increase sustainability. This funding will support our third sector to continue to support people and communities in responding to the ongoing impact of the pandemic.
We will begin work to explore other strands of social investment including capital loans to support the sector to work together and co‑locate as the demand for office space declines, whilst leaving organisations with an asset in future years to enhance sustainability, and ensuring that this benefits all areas, particularly those hardest hit by the crisis.
Good Jobs and Green Jobs
We will also build upon our existing and extensive work to support social enterprises and Credit Unions which provide vital financial services for some of our most deprived communities. We will launch the next Social Enterprise Action Plan, by the autumn, and the Credit Union Strategy by the end of the parliamentary term – both of these are essential to a wellbeing economy.
The legal environment within which Scotland’s 29,000 charities operate is critical to all of our ambitions for the third sector. Delayed by the crisis, we will now re‑start our process of co‑production with the sector to review Charity Law and publish our proposals by the end of this parliament.
Communities across Scotland– particularly those in remote and rural areas as well as in urban regions – have benefitted significantly from European Structural Funds, with the current 2014‑2020 programme worth over £780 million. The UK’s exit from the EU means that we will lose access to this vital funding, hindering the progress that has been made in supporting the economic and social wellbeing of these communities. The UK Government has committed to replacing this support with the UK Shared Prosperity Fund, but as of now, we have not been given any clear detail on how this will operate in practice.
We will therefore continue to move forward on the assumption that an appropriate allocation of the Shared Prosperity Fund will be devolved to the Scottish Government to disburse in line with our own policies and targets. We will work quickly to establish a Scottish Programme that will be focussed on promoting place‑based economic development and cohesion, helping communities across Scotland to improve key economic, social and wellbeing performance indicators.