In February it was announced that Access will receive an additional £20m from dormant assets to extend our support for charities and social enterprises in England.
Now known as Enterprise Growth for Communities (EGC), the new programme launches following a detailed consultation process to inform its design. We are grateful to all of the organisations who got in touch to share their thoughtful responses, which have been extremely helpful in informing our thinking.
This blog provides reflections on what we heard through the consultation and where this has led us. If you would like more detail about the different views shared during the consultation and how these have informed some specific decisions that we have made, we have also published this consultation report.
The programme is now open to expressions of interest and applications from social investors wishing to set up funds – please see this page for full details and how to apply.
Reflections from the consultation
During the consultation, we received a broad range of responses to several different design questions. The range of views could be broadly categorised into two buckets. The first being calls for greater flexibility and/ or the expansion of the programme’s stated objectives in order to serve a broader set of needs. And the second being calls to retain simplicity and fixed parameters to prevent mission drift and ensure that the programme can achieve its stated goals. The direction that some respondents were leaning varied between different topics, whilst others were more firmly in one camp or the other across their responses to all of our consultation questions.
This divergence of views is perhaps unsurprising given what the programme sets out to do. On the one hand it will serve to ensure a supply into the future of small-scale, unsecured blended finance once the Growth Fund comes to a close at the end of this year. However, on the other hand it is not intended to be a clone of that programme. Instead, it must incorporate all the learnings and experience that we and our partners have gained over the years and adapt accordingly. For this reason, when making programme decisions we have tried to strike the right balance – providing flexibility where it makes sense to do so whilst ensuring that we do not change or stray from the programme’s core objectives.
A couple of consultation respondents pointed out that there is more than one product gap in the market. We completely agree. We recognise that there is a need for more patient and flexible products including quasi-equity style products (which our Flexible Finance programme is helping to address). We also agree that there is a role for zero-interest or extremely low-interest products to help some organisations take their first steps into social investment. And we know that in some respondents’ view there is a need for more provision in the £200k+ investment range. However we know from the Growth Fund that there is still an extremely high demand for simple, unsecured, small-scale term loans, so if we were to try to broaden the remit of this particular programme we would likely end up with significant unmet demand in this area, simply shifting rather than solving these problems. Ultimately we felt confident that we should not significantly expand the remit of this programme, particularly since this view was shared by several consultation respondents.
That does not preclude us, of course, from evolving our original thinking and setting some big ambitions Some examples of how our thinking has evolved include the setting of the upper investment limit at £200k (although the programme will continue to target an average investment size of under £80k) and allowing security to be taken by exception if there is a particular concern about wanting to protect the social purpose of an asset. We will also enable greater flexibility on use of grant, fund structures and residual grant. The consultation report discusses all of these in more detail.
Some big ambitions include a target that our £20m of grant will enable £60m+ of investment to be made into charities and social enterprises over a four years, as well as enabling the recycling of grant to contribute to the longer-term continuation of these activities and, as such, the sustainability of the social investors who deliver them.
You can read the report to find out more about how the consultation shaped our thinking. Or to find out more about the Enterprise Growth for Communities programme and how to apply to manage a fund please visit this page.
