A further £76 million is being released from dormant assets to help those struggling with the cost of living, with more to come as the Dormant Assets Scheme expands, DCMS has announced.
Beneficiaries include no-interest loans for 69,000 individuals struggling with finances via a £45 million grant distributed by Fair4All Finance. Hundreds of charities and social enterprises will receive support from a pot of £31 million, distributed by social investors Access and Big Society Capital. This will be used to retrofit premises with cleaner, greener, and more efficient energy systems, such as new boilers or heat pumps, solar panels, and new lighting.
This decision follows a public consultation last summer. A coalition from across the social, business and investment sectors came together to feed into the consultation and propose the Community Enterprise Growth Plan, with the goal of supporting social investment to reach places and communities that have not benefitted to date.
Stephen Muers, Chief Executive of Big Society Capital said:
“This is an important step and we welcome the commitment from the government to continue to supporting the enterprises and communities that are helping those most in need at a critical time.
“The social investment infrastructure is already in place, meaning we will be able to deploy funds at pace. And because it catalyses private and philanthropic investment alongside, we can make this money go much further. For example, every £1 from the dormant asset scheme to-date spent on social investment has unlocked another £3 from other investors.”
The Dormant Assets Scheme unlocks money from forgotten bank and building society accounts, and is soon to be expanded to include assets from the insurance and pensions, investment and wealth management, and the securities sectors. An estimated £738mn more will be made available over time through the Scheme’s expansion to these new sectors, bringing the total to £880mn.
Community wealth funds to benefit
The government has also announced that community wealth funds will become an additional beneficiary of the Dormant Assets Scheme. These are pots of money distributed to communities in deprived areas and released over a long time period, with local residents empowered to make decisions on how to use it.
The government will shortly launch a public consultation on the overarching design of this new initiative.
Youth, social enterprises, and people in financial difficulty will continue to be supported, with previous beneficiaries including community centres and charities providing care for the socially isolated and elderly.
Kirsty Cooper, Champion for the Insurance and Pensions sector and Group General Counsel and Company Secretary, Aviva said:
“The expanded Scheme will help to make a real difference to the lives of those people who need it most across society, freeing up millions of pounds at a time when financial hardship is a real cause for concern, and I welcome the news that financial inclusion will receive additional funding to support this.”
Also commenting, Stephen Bediako OBE, Co-founder of the Pathway Fund and Founder of the Black Global Trust said:
“I’m happy to see the government has continued to harness the Dormant Assets Fund for the UK social impact space with a further £880mn investment. In particular the focus on harnessing social investment is most welcome. As a co-founder of the Pathway Fund I’m excited to work with communities up and down the country, government, BSC, Access Fund, Social Enterprise UK and others to see how we develop a social investment space that is accessible for all, especially black and minoritised communities.
“The data shows that we are leaving social impact and impact returns on the table by not making our social investment space more accessible. It is great to see the recommendations of the Adebowale Commission acknowledged and recognised – and we hope this will lead to a step change in approach for the social investment space.”
Reclaim Fund Ltd is currently making the final preparations to launch the expanded Scheme. This will welcome the first participants from the insurance and pensions sector in the coming months, with other sectors joining later this year.