At its heart the social investment sector aims to tackle inequality – by backing sustainable enterprises that support the most disadvantaged. We are learning that pandemics have always exacerbated inequality – and this one is no different.
Those on low incomes are likely to have jobs that are most exposed. Those living in sub-standard accommodation are suffering most in lockdown. Before this crisis, over 13 million people in the UK did not have enough savings to support them for one month if they experienced a 25% cut in income . A few weeks into this crisis, the Food Foundation is already reporting that 1.5 million Britons reported not eating for a whole day because they had no money or access to food.
We know the work of the organisations we support is needed more than ever through this crisis. Four weeks ago, we set out the three priorities where we needed to move early and fast to support organisations through this, and we want to keep you updated on progress:
Our social investor and social enterprise COVID-19 hubs have now received more than 25,000 unique visitors. The pages on finance and grants are the most visited and we know grants are needed most by organisations we support in this crisis. We welcome the £750 million government grants programme announced last week. Also last week, our sister organisation, Fair4All, launched the COVID-19 Resilience Fund providing grants for ethical lenders such as CDFIs and credit unions. There are more details on these and many other support programmes on Good Finance.
Adjusting existing funding
We have now largely completed the adjustments across our portfolio to give organisations additional cashflow flexibility where needed in the first stage of this crisis.
In each part of our portfolio fund managers are responding in different ways. Social property investments have so far been relatively resilient, though the need for their services is increasing. For example, initial evidence suggests incidences of domestic abuse are rising in lockdown. We recently re-confirmed our £10 million commitment into the Women in Safe Homes fund managed by Resonance and Patron Capital which supports survivors of domestic abuse – the fund is targeting a launch in June. As outlined recently by Crisis, Homeless Link and others, coronavirus creates additional challenges for tackling homelessness, including planning now for the exit from current hotel arrangements.
Exploring new funding
Last week, we announced our £100 million programme of response and recovery investments – enabled by the accelerated release of £45 million of previously committed dormant accounts. This is being designed to provide emergency investments to sit alongside the other packages of support announced for the sector. As with all funders, we are aiming to significantly accelerate our timetables here to get investment to where it is needed quickly, but it also means we won’t get everything right first time, and will be aiming to learn and adjust.
More details on the Social Investment Business plans for the Resilience and Recovery Loan Fund can be found here, with applications opening early next week.
We believe the demand for investment will be greater than our commitment. We have aimed to move early to establish the funding structures, and are now working with Social Investment Business, the Impact Investing Institute and others to help fundraise. If you are interested in working with us on emergency funding, do get in touch.
All our work in responding to this crisis has required significant partnership between social investors, funders, charities and social enterprises. This fantastic collaboration has been vital to the steps so far and will be increasingly important in the work that lies ahead.
Financial Inclusion Commission - Facts