New Blog: Big Society re-launch risks becoming just a re-hash #bigsociety

Yesterday I was at the Big Society Network’s event where the Prime Minister relaunched his Big Society project. The room was packed with the faces I expect to see at these sort of affairs – though not as the media suggested an audience solely of social entrepreneurs – and we were all ‘treated’ to John Bird’s singing in advance of the Prime Minister’s arrival.

When he spoke, David Cameron gave a relaxed and upbeat performance, displaying every ounce of his marketing experience. The jacket came off (perhaps suggesting the symbolic removal of a straitjacket Big Society finds itself in?) and he seemed to slip back in to election campaigning mode.

However the thing that surprised me somewhat, was that there was nothing new in his speech. Over the last few days the media had been awash with advance notice that the PM was going to breathe new life into the Big Society vision. He was, we were told, going to get it back on track with a host of announcements to revive the idea. I’d expected therefore to hear him pull at least one or two rabbits out of the hat – some new money to boost the transition fund, or a new initiative, or even an announcement on some of the existing plans which have gone a bit quiet recently. But there was nothing. No new programme. No money. Nothing new. Just a restating of the vision and aims of the Big Society – the same vision and aims which have failed to gain traction among the public to date. Perhaps, as some people I spoke to suggested, the public aren’t bothered by a lack of anything new – or aren’t fobbed off by a small pot of money. But I must admit that I was surprised and I can’t help thinking that the PM’s PR skills may have misjudged the public mood.

The daily news of cuts to charities and community groups – now, according to the Voluntary Sector Cuts website close to £50m – brings with it real stories of hardship for the most vulnerable in society. The inconsistencies in Whitehall to stand by the Big Society rhetoric undermine its credibility. We’re told one the one hand ‘we won’t tell Local Authorities what to do’ and yet at the same time they are being told they must collect bins once a week and publish data on all their spending over £500. This lack of consistency challenges even the most optimistic among us in our belief that Big Society may present opportunities in the future.

After a few questions from people whose names he knew, the Prime Minister did take close to an hour’s worth of questions, which I have to give him credit for. The audience were fairly deferential and he didn’t get the hard time he might if he’d been talking Big Society to the general public. He skilfully sidestepped mildly awkward questions – giving several ‘non-answers’ and using anecdotes to ‘prove’ that something was true. But that’s par for the course with politicians in my experience (sad but true!).

I was pleased to get the chance to ask the Prime Minister how the £200m he had told us he’d ‘got out of the banks’, was really worth anything to civil society given that it was being provided on a commercial basis? The Prime Minister replied by giving me an example of a social enterprise that needed capital – which is quite frankly neither here nor there – and then went on to say that the Big Society Bank would offer greater understanding than commercial banks and that he hoped the capital it provided would also be cheaper.

Let’s just think about the two elements of his answer.

First, that the Big Society Bank (BSB) will be more understanding about the needs of social enterprises and charities seeking capital. However the BSB won’t be lending to charities and social enterprises directly, it will be lending money to existing social finance providers – Community Development Finance Institutions such as Charity Bank, Social Investment Business and the like. His answer seems to lack any awareness of these existing institutions who (to a greater or lesser extent) already understand the needs of the sector. There are a range of ethical and socially motivated financial institutions that provide capital to support social ventures – Triodos Bank and Unity Trust – have been doing this for money years and will continue to do so. My understanding (and I am prepared to be corrected on this) is that for enterprises with strong business plans and financial viability there is finance to be had. So quite where the PM’s ‘more understanding’ fits I’m not quite sure.

The second part of his answer was that BSB would provide cheaper money. So capital is loaned from the high street banks to the BSB – for a profit. The BSB then loan it on to social finance providers – both of whom will have admin and overheads that need to be covered. Then, finally, the money will be available to social enterprises and charities (with further transaction costs to recoup). How can that money be cheaper than going directly to the high street banks? Or even to the social finance providers who’ve raised money themselves without the intermediary of the BSB?

The only feasible answer I can see is by using the dormant accounts – part of the BSB’s capital comes from the unclaimed assets that will be administered by the BIG (the Lottery distributor). Perhaps that’s okay. Personally I’d like to see unclaimed assets used to help fill the huge gap in funding available to community groups and small charities who aren’t delivering public services or anywhere near being in a position to take out a loan (and may never be). In effect this (now) ‘public’ money is being used to provide the banks with a profit. Once again we’re underwriting risks being taken by the banks (albeit for social purpose this time).

The Prime Minister has placed a huge amount of personal capital on Big Society – at one point yesterday he admitted that Big Society wasn’t about winning elections….which the latest polls would seem to confirm. If Big Society is ultimately consigned to the policy dustbin, one wonders what the knock on effect on David Cameron’s credibility would be. Given that, I think he would be well advised to find something ‘new’ to add substance to the vision in the very near future.Not only does thi

Toby Blume

Chief Executive

Urban Forum

 

Twitter: http://twitter.com/tobyblume/ 

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4 thoughts on “New Blog: Big Society re-launch risks becoming just a re-hash #bigsociety

  1. Good one Toby on the BigSociety Bank. Its complete tosh and 5 years down the line since the unclaimed assets idea was launched.How many fees have already been paid to construct a complicated arrangement with so many opportunities to screw the rest of us?John

  2. Thanks John.My frustration is partly about the way the deal with the banks is presented as a ‘victory’. But we in the sector ought to take a long hard look at our response to it, as too many were quick to welcome the (so called) ‘new money’

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