Speaking at the Good Deals 09 Conference in London on 29th October, the Minister for the Third Sector announced that a further five community-owned social enterprises have been selected to take part in a Government-funded research project looking at new ways for social enterprises to attract finance.
The research, which started earlier this year, is examining the potential of community shares and bonds as a way to attract extra investment. This includes inviting ten social enterprises to test the idea, looking at barriers that could restrict their growth and how they can be overcome. The successful social enterprises receive a package of funding and support and their experiences will be used to support future policy development in this area. Five social enterprises were invited to take part earlier this year, the second five benefiting from the second round of support are:
• Hurst Green Community Shop & Centre, East Sussex which aim to raise finance to renovate a local church to provide community shop, post office, youth centre and drop in health centre. We aim to reduce social isolation, provide village jobs (both paid and volunteer) and create a meeting place where village communication can prosper.
Councillor Christie Greenfield, Chair of Hurst Green Action Steering Group, said:
“We have no Community Shop or Post Office and in these difficult times of recession, with the general speed of living and ever forward pace of progress, rural communities and the people in the villages are becoming more isolated.
The need for a central nucleus or hub where people can meet up and talk anytime is vital.”
• THEP - Tutbury Hydro Electric Project on the River Dove, in the heart of England, on the Staffordshire/Derbyshire border, which aims to reinstate the mill fleam, a man-made water course running alongside the park, and install a micro hydro electric plan. It will establish the green credentials of the locality by reducing our collective carbon footprint and over time, the hydro plant will pay for itself, generate income and return funds to the community for other environmental, energy and educational causes
• Sheffield Renewables Ltd, River Don, Sheffield which plans to develop a small scale hydro scheme.
Rob Pilling, Chair of Sheffield Renewables, said "We are well on our way to bringing community owned renewable energy to Sheffield. We are delighted to be selected for this study which we hope will help similar projects spring up in other cities."
• Oxford Cycle Workshop Training Ltd, Oxford which provides community cycle training and aims to serve the needs of individual young people in vocational training programmes embedded with co-operative values, through to online community resources that aspire to creating broad engagement
“Embarking on this journey with the Community Shares programme offering us support and avenues to explore our experiences with others on the same journey is an incredible opportunity. We believe the development of strong community investment models is key to the development of sustainable community owned co-operatives that engage the communities they are at the heart of” Dan Harris, OCWT Management Committee.
• Brixton Green, London which aims to galvanise a Central Brixton community into working together to build a better neighbourhood in by enabling them to invest directly in a regeneration building programme including a theatre, education, urban farming and sustainable housing. Brixton Green is a community owned and community controlled development company based in Brixton, South London. It is set up as an industrial provident society with the sole purpose of benefiting the community; working in productive partnerships with public and private organisations to: • Build better neighbourhoods• Create local wealth• Improve the local quality of life.
In order to be part of the project, all of the social enterprises demonstrated that they:
• Intend to raise finance through community investment ie. “The sale, or offer for sale, of more than £10,000 of shares or bonds to communities of at least twenty people, to finance ventures serving a community purpose.”
• Will issue non-transferable securities.
• have a committed group of project champions and an established steering group, unincorporated body, partnership, association, or corporate body
• have community support for their venture
Hugh Rolo, Head of Assets and Investment at the DTA said: “The standard of applications throughout this process has been very high and we are delighted to be supporting ten community enterprises. The inclusion of two hydro schemes in round 2 demonstrates that local communities are using community shares to establish vital and preferred sources of renewable energy. Renewable energy is also a priority given the current climate threat. Brixton Green and Hurst Green are very different in terms of their scale and the nature of the local community but both demonstrate the importance of providing essential services and facilities to their local community.”
Ed Mayo, Secretary General, Co-operativesUK, said: “Community investment is about community engagement and this is at the core of the co operative way of business. For example, Oxford Cycle Workshop already has an excellent track record of engaging with local young people and improving skills and confidence. Sheffield Renewables demonstrates co-operatives’ continued commitment to renewable forms of energy. I think other communities will want to follow their example.“
Angela Smith, Minister for the Third Sector, said: “Like all the projects in our Social Enterprise Action Research Programme the "Community Shares" project is truly exciting. Not only is it helping government learn about social enterprises, but social enterprises themselves will also benefit from the research. This project will help us understand what Government can do to support communities who want to invest directly in local social enterprises solving local problems. My ambition is that in the future more communities will be able to benefit from lessons we learn through the project."
Barbara Follett, Parliamentary Under Secretary of State for Communities and Local Government, said: "The Government is excited about the potential that community shares have to help people invest money and effort in support of a social enterprise that they know will address local needs. We are keen to find out more about how best to make community shares more widely available"
This project is part of a £1.3m Social Enterprise Action Research programme enabling departments across government to explore the role social enterprise can play in helping them meet their policy objectives - from tackling climate change to managing the nation’s health. The programme is funded by The Office of the Third Sector, in the Cabinet Office. For more information go to: http://www.cabinetoffice.gov.uk/third_sector.aspx.
This first round successful projects (June 2009) are:
• Cybermoor, Alston, Cumbria aims to bridge the “digital divide” in rural areas by helping people use the internet and provide affordable broadband
• Hastings Pier & White Rock Trust aims to regenerate the pier buildings in particular the "apron" section closest to the promenade
• FC United of Manchester aims to raise up to £1m using community shares and bonds with the aim of building a new £4 million community stadium in Manchester.
• Slaithwaite Cooperative Ltd Green Valley Grocery store, Colne Valley, nr Huddersfield raised funding through a community share issue to re-open a valued independent greengrocery shop
• Ashington Community Development Trust (Ashington Minors Childcare), Northumberland aims to become more integrated within the community through a community share offer
