Posted in: General News
£10 million ethical investment supports regeneration initiatives.
Community-led regeneration projects in Scotland have received a £1.4 million funding boost as a result of the Scottish Government’s innovative investment of £10 million with Allia, a charitable provider of social investment products.
Projects to benefit include the Hauners Helping Hand initiative that will provide support services for over 200 local unemployed young people living in Castlemilk near Glasgow, as well as a training, employment and volunteering programme that will support at least 40 people living in the most deprived areas of Falkirk and Stirling to learn new skills and gain qualifications.
Housing and Welfare Minister Margaret Burgess announced the distribution of the funding, which is being delivered through the Scottish Government’s People and Communities Fund, at the Harper Macleod conference in Dunblane today (Tuesday).
The £10 million ethical investment in a Charitable Bond from Allia makes innovative use of financial transaction money. £8.6m of the investment has been made available to Castle Rock Edinvar Housing Association, through the loan to Places for People Group, to build affordable homes in Scotland.
The remaining £1.4 million has been allocated in grant funding to support People and Communities Fund projects in Scotland. It is the repayment of the loan plus compound interest that will enable Allia to repay the Scottish Government’s investment in full.
Mrs Burgess said:
“I am delighted that our investment is helping support community groups throughout Scotland who are undertaking vital work within their local area. The People and Communities Fund has been extremely popular supporting more than 130 projects since being launched in May 2012. This additional funding will support a further 14 worthy projects that had applied through the fund.
“The innovative Charitable Bond model is allowing us to not only generate grants for charities but also allow funding in the form of a loan to a housing association to build more affordable homes across the country.
“This is the first major investment in a Charitable Bond in Scotland. This government is taking the initiative, however with full economic levers we could deliver more support for the poorest communities.”
Tim Jones, Chief Executive of Allia, said:
“We’re delighted to manage this investment by the Scottish Government to support projects that will benefit communities across Scotland. The £10 million investment is the largest to date in our Charitable Bonds and provides a pioneering example of how finance can be used for social good.”
Heather Macnaughton, Head of Neighbourhood Regeneration at Castle Rock Edinvar said:
“To finance new affordable housing we need to borrow. The Charitable Bond model provides a mechanism to add additional social value as part of our overall portfolio of lending. We are delighted to be able, through our existing knowledge of the product with Allia and the Places for People Group, to introduce this in Scotland.”
Fraser Howat, Head of Castlemilk Youth Complex said:
“The People and Communities funding will enable the Hauners project to make a real difference. By engaging with disaffected young people from the Castlemilk area of Glasgow and encouraging them to participate in activities designed to achieve their aspirations, the project will help them to reconnect with their local community.
“The project will identify disengaged young people that are struggling due to issues such as drink, drugs, gang fighting or other crime and offer them engagement, support and encouragement to progress towards further education, training or employment.”
|Charity Name||Project Name||Project Location||Funding|
|Barmulloch Community Development Company||Barmulloch Community Facility Development Project||Glasgow||£128,000|
|Blairtummock Housing Association Ltd.||Financial Capability and Inclusion Project||Glasgow||£108,658|
|Castlemilk Youth Complex||Hauners: A Helping Hand||Glasgow||£86,859|
|Fallin Community Enterprises||Recyke A Bike||Falkirk and Stirling||£78,700|
|Gorbals Youth Run Drop-in
|South East Detached and Outreach Work Programme||Glasgow||£40,698|
|Govan Housing Association Ltd||Financial Capability Modern Apprenticeship Programme||Glasgow||£50,000|
|Govanhill Housing Association Ltd.||Govanhill Community Training Garden||Glasgow||£154,286|
|Govanhill Housing Association Ltd.||Financial Literacy and Advice Project||Glasgow||£117,865|
|Hawkhill Community Association||Supporting Community Momentum||Clackmannanshire||£88,017|
|Hillhead Housing Association 2000 Ltd.||Hillhead Addictions Employability Initiative||East Dunbartonshire||£50,855|
|Kirkshaws Neighbourhood Centre||Brighter Futures Programme||North Lanarkshire||£192,190|
|Mayfield and Easthouse Youth 2000 Project||Growing Futures||Midlothian||£70,290|
|West Dunbartonshire CVS||Social Prescribing Service||West Dunbartonshire||£76,833|
|Whiteinch and Scotstoun Housing Association Ltd.||Working Rite Project||Glasgow||£191,977|
This £10 million is part of an additional allocation of financial transactions funding, restricted to loan and equity investment, coming out of the UK Budget. This is not additional capital grant to the Scottish Government but is additional loan fund money that can’t be invested directly and must be repaid to the UK Government. By using this money creatively and investing it in a Charitable Bond the Scottish Government is able to convert part of it into grant funding for charities and provide loan finance for affordable housing in Scotland. The grant element is a one-off payment for charities and does not have to be repaid to UK Government.
Charitable Bonds are an ethical investment product where the interest is released as grant funding to charities on day one of the investment. Charitable Bonds were developed by Allia, a community benefit society based in Cambridge, and have been used successfully to raise money for charities in England and Wales over the last ten years.
Scottish Government’s investment of £10 million in a Charitable Bond will generate £1.4 million in grant for charities. This grant is being used to grant fund People and Communities Fund projects. The £8.6 million loan element of the investment will be used by Castle Rock Edinvar Housing Association, through onward lending from Places for People Homes, to develop 150 new affordable homes in Scotland.