9 December 2009
The consultation on the Social Investment Wholesale Bank (SIWB) was launched on 15 July 2009 and closed on 7 October 2009. The consultation document set out the vision and economic case for the SIWB. It also consulted on the design and functions of a potential SIWB.
On the 9 December 2009, the Office of the Third Sector published a summary of responses to the consultation, including next steps in taking forward work on the SIWB. In the next few months, the Government will finalise the model for the SIWB and will aim by Budget 2010 to start the process of engaging with potential providers of this financial institution.
To fund the SIWB’s initial capitalisation, Government also announced in the Pre-Budget Report (2009), its intention to commit up to £75 million of the funds expected to be released through the Dormant Accounts Scheme in England, subject to the final volume of funds and alongside funding other priorities.
In a joint foreword, Liam Byrne - Chief Secretary to the Treasury and Angela Smith - Minister for the Third Sector, said:
“Organisations, driven by a social mission, are changing lives for the better every day, delivering important social and environmental outcomes and increasingly delivering core public services.
The task now is to push this frontier further still by ensuring that there are more resources - financial and human - to continue to innovate in this way.
We believe that social investment could make a huge difference to the third sector and other organisations with social impact. We are therefore committed to the development of a strong and sustainable social investment market that crowds in new players and new flows of capital”.
You can download a copy of the summary of responses to the consultation on the SIWB via the link in the 'Background' section below.
Government recognises the important role played by the third sector and other organisations driven by a social mission – as sustainable organisations with a social or environmental mission they contribute significantly to stronger local economies and a fairer society.
Yet it is argued that access to appropriate funding and finance often remains the single biggest concern facing organisations driven by social or environmental purpose.
A Social Investment Wholesale Bank could help enable third sector and other organisations to access the finance they need to grow and become more sustainable. More broadly, the Bank could help increase investment in society, the environment and the economy at the same time, delivering against a ‘triple bottom line’ of more effective interaction between greater economic growth, social cohesion and sustainable development.
The consultation response showed a strong consensus for a mission-driven financial institution, operating independently from government and retail intermediaries and at a wholesale level to support the development of a strong and sustainable social investment market in the UK.
Respondents agreed that the SIWB should crowd in – not out – existing and new players and encourage new flows of capital in this space.
Respondents also highlighted that there were deep capacity issues on the demand-side that needed to be addressed, although not necessarily directly by the SIWB.
A copy of the original consultation document, response questionnaire and the summary of responses can be downloaded via the links below:
Please direct any questions you have relating to the Social Investment Wholesale Bank to:
Social Enterprise and Finance Team OTS
Admiralty Arch South, The Mall, London SW1A 2WH