A week ago, we wrote to tell you how we were responding to the coronavirus crisis. It has been heartening to see how our colleagues, partners and fellow investors have come together in challenging circumstances around a shared mission. Together we are determined to do whatever we can to help the social enterprises and charities we all know are so vital to the most vulnerable in society and are now at great risk. At the start of the year, none of us expected to be working in this way, and now we are all adapting to working in an emergency – remotely – with our children, partners and pets in the background.
As the situation is developing so quickly, we thought it would be helpful to update you on what we’ve done so far across the three priority areas we set out last week.
Following our joint letter with other social investors, we have launched a COVID-19 Resource Hub on Good Finance to bring together information, resources and emerging support for charities and social enterprises to help them navigate this crisis. We have also developed an information page on the Big Society Capital website to keep social investors updated on our plans as we respond to COVID-19.
As new support programmes emerge, we are actively lobbying government with many others across the sector to ensure that all interventions are available equally to charities and social enterprises as well as the business sector. For example, we were pleased to see this equivalence confirmed for the most recent offer to pay 80% of furloughed workers’ wages which will be a significant intervention for many organisations struggling at the moment.
Adjusting existing funding
We have been prioritising work with our lending funds and intend (where possible with our co-investors) to be offering interest and capital holidays across our portfolio for charities and social enterprises affected. We will update next week on our work in other investment types.
Access and its partners have moved rapidly to restructure the Growth Fund so it can help the over 400 charities and social enterprises with outstanding loans. Big Society Capital will be waiving all interest to this program for six months and extending its life to give maximum flexibility for capital and interest holidays where appropriate.
Exploring new funding
We know social investment will only be a small part of what’s needed here. Everything from the large interventions of HM Treasury to the many small acts of kindness we’re already seeing across the country will be vital. For charities and social enterprises grants will be particularly important. Loans are a poor replacement to lost revenue. Where investment can help is around likely working capital challenges, as well as investment to adapt service delivery to this new environment.
We are exploring at speed a number of routes to create an Emergency Liquidity Facility for the sector, including accessing new British Business Bank guarantees and new sources of funding alongside ours. We believe this is needed very quickly and at significant scale and hope to announce an initial facility within the next week.
In the immediate future these three areas will remain our top priorities as we do our very best to respond to this crisis. We will work with our partners to use our collective resources to try to relieve immediate financial pressure on organisations. We are already in touch with many funders, fund managers and social enterprises and charities. If you can help or if you need help, then please get in touch.