The big society bank will provide finance for the voluntary and community sector through funds to social lenders and investors. It will provide funds only to bodies that are onward lending or investing in the voluntary and community sector, charities and community groups.
I thank the Minister for his response. In the light of that, can he please indicate how the bank will define social enterprise, as currently there is not a legal definition? How will he ensure that all social enterprises have access to funding but that no organisation that exists for private profit has such access?
Social enterprises can take a wide range of different forms, but the common feature is that they do not seek to make a profit for shareholders. I think there is a widely understood definition of voluntary and community sector groups, and the big society bank will be organised in such a way that it can identify those and make sure that the funds that it is providing to social investors and social lenders go only to those groups.
May I commend the intellectual ideas behind the whole concept of the big society? May I also commend to my right hon. Friend an article by Tim Montgomerie that appeared on ConservativeHome earlier this week entitled, “Conservatives can win the poverty debate but not if the Big Society is our message”? Is the big society more accurately described as a label for a collection of policies rather than a policy itself?
I am grateful for that guidance, Mr Speaker.
My hon. Friend is right to point out that the big society is an idea with a very wide application. The big society bank is a fund that will have a very wide application, because we believe it is extremely important that it should be able to foster all sorts of voluntary and community enterprise which, in one way or another, enormously support the alleviation of poverty—the subject of the article to which he refers.
The idea of such a bank to help to develop the centre of civil society is a good one, but effective government requires a mix of big ideas and getting the details right. In this connection, has the Minister seen today’s report by the National Endowment for Science, Technology and the Arts, which suggests that if the big society bank lends purely on commercial terms, it will be
“failing to support those that it is set up to support”?
What can he say to ensure that the lofty rhetoric of the big society bank does not founder on the rock of inadequate administrative detail?
The hon. Gentleman is of course right to say that the big society bank could not operate as it is intended to operate if it were lending, or investing, on purely commercial terms. It will have what is often described as a double bottom line: it will seek to achieve the highest possible social returns alongside reasonable financial returns. Indeed, part of the point of the big society bank is to show that there is no conflict between achieving high social returns and achieving modest but reasonable financial returns.