The economic and social impact of the pandemic on the third sector in Scotland has been well documented. OSCR’s November 2020 Survey noted that a third (30%) of registered bodies reported financial security as a threat for beneficiaries, with a quarter (24%) observing increased financial hardship and vulnerability.
Reflecting the ongoing (and, in places, deep) impact of the pandemic, the Scottish Government announced in February 2021 that Social Investment Scotland had been awarded £15m as part of the overall commitment of £30m of resource to the Third Sector Growth Fund.
Although this new capital is repayable to the Scottish Government and therefore must be invested, rather than granted, the terms do allow for greater flexibility than some other SIS funds. In essence they are more patient, with longer term and lower costs. To ensure that future SIS funds meet the needs of the third sector and focused on social impact, we consulted with key stakeholders and directly with charities, CICs and social enterprises. We also sought evidence from published research and surveys undertaken by NCVO, SCVO, OSCR among others. Whilst not all surprising, findings from this research are informing our next steps.
Contributors noted the need for long term patient funding to rebuild (particularly unrestricted) reserves. Trustee boards and senior teams need support to understand the features and benefits of social investment. Business support was also needed to prepare organisations for investment (preparing financial models and business case development).
The terms, features and benefits of social investment should be linked to, and recognise, purpose and social impact. The engagement exercise also identified SIS’ role in wider engagement with grant makers: offering referrals and introductions where there’s an opportunity for joint support.
Responding to the sector’s input, SIS has a future programme of work to support the sector in advance of new funding being launched.
A range of engagement events has been planned, explaining social investment, its features and benefits. We’re partnering with OSCR and SCVO among others to ensure we reach a wide third sector audience.
Interested in exploring social investment for your organisation? As a first step, please see our free online tool. For those that want to progress, in certain cases we can also offer some free consulting support to build your proposal.
It’s not too late to input into our thinking. Please get in touch with our project manager marcella@socialinvestmentscotland.com to share your views. Later in Summer, we hope to formally launch the new fund with a focus on social impact: supporting organisations to rebuild their reserves and continue to invest in innovation and growth.
Look out too for further information later in the year for the launch of our Circular Economy Fund which will support the third sector’s response to net zero and circular opportunities.
Get in touch with Macella via email marcella@socialinvestmentscotland.com.
