WIREDGOV

Stakeholders back ground-breaking social enterprise risk capital investment fund

CABINET OFFICE News Release (CAB/086/08) issued by The Government News Network on 31 July 2008

Phil Hope, Minister for the Third Sector, today welcomed the overwhelmingly positive contributions to the Government's consultation on establishing an unprecedented £10million fund for risk capital investment in social enterprises.

The proposal for an equity and equity-like investment scheme, to be matched by private investment, has won near-universal backing from a broad range of industry experts. Respondents agreed with the Government that the proposed fund would help bridge a gap in finance that some social enterprises experience particularly when moving from a start-up to a growth phase.

The consultation also raised a number of issues that the Government has considered and addressed in its response which is published today. As a result, improvments have been made to the proposals for appointing and reimbursing the fund manager or managers.

Welcoming the views, Phil Hope, Minister for the Third Sector, said:

'The consultation has reinforced my view that a lack of access to risk capital finance can hold back social enterprises from reaching their full potential to improve peoples' lives.

'We are world leaders in social investment. The social enterprise risk capital fund is exploring uncharted territory and the consultation responses are an invaluable guide. I'm extremely grateful to those who have contributed to this discussion for their constructive support which has helped fine-tune the fund to give it the best chances of success.'

Overall there were 29 responses to the consultation from a wide range of industry experts, Regional Development Agencies and bodies representing investors and thousands of social entrepreneurs. The next step will be to appoint a fund manager or managers through an open competition over the coming months.

Notes to Editors

1. For further information on the risk capital fund and the Government's response to the consultation please see:
http://www.cabinetoffice.gov.uk/third_sector/funding_finance_support/risk_capital_fund.aspx

Cabinet Office Press Office 22 Whitehall LONDON SW1A 2WH
http://www.cabinetoffice.gov.uk