Outline proposals for the Big Society Bank have been endorsed by Francis Maude,
minister for the Cabinet Office.
The bank is to act as a wholesale investor for social investment. It will invest capital in intermediaries so they in turn can invest in frontline organisations and in "developing a powerful infrastructure for the social investment sector". It will not make grants, but will act as a champion of the sector to the public, stakeholders and investors.
Source: Cabinet Office
"Over the last ten years very significant progress has been made in the development of social investment in the UK. Today's announcement by the Government gives the go ahead to the creation of the Big Society Bank. This is a momentous step forward. The Big Society Bank is the first organisation of its kind in the world. We believe it will revolutionise the way that the social entrepreneurs and the social sector are funded in the UK," said Sir Ronald Cohen, one of the independent advisers on the Bank.
Also approved by Maude is the formation of an interim investment committee, to be managed by the Big Lottery Fund, which will use the dormant account money it has received to start making investments from this summer.
The committee is to comprise six experts in social and financial investment. They are:
John Kingston, Director of CAF Venturesome and Chair of the Investment Committee;
Chair of Big Lottery Fund's England Committee or his/her nominee [to be appointed shortly];
Anna Southall, Big Lottery Fund;
Sir Ronald Cohen, Independent Adviser on the Big Society Bank;
Nick O'Donohoe, Independent Adviser on the Big Society Bank; and
Dawn Austwick, Chief Executive of Esmée Fairbairn Foundation.
Francis Maude, Minister for the Cabinet Office, said:
"Sir Ronald Cohen and Nick O'Donohoe have developed a robust proposal for the Big Society Bank drawing on experience in the social sector. It will be the first institution of its kind anywhere in the world dedicated to growing the market for investments that blend financial and social returns. The interim Investment Committee will ensure that we can start getting additional finance into the social sector as soon as possible."
It is expected the Big Society Bank will eventually receive £400m from unclaimed assets in dormant bank accounts, and £200m from the UK's largest banks.
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