Chancellor Rishi Sunak announced his spring budget today with a series of measures in response to the Covid-19 crisis, including an extension of the furlough scheme to September and financial support for businesses as they reopen.
Of particular note to the co-op movement is the £150m Community Ownership Fund – announced yesterday – and an extension to Social Investment Tax Relief is being extended, following intensive lobbying from Co-operatives UK and other organisations.
Rose Marley, chief executive of Co-operatives UK, said: “We welcome the £150m Community Ownership Fund that will help more people save valuable community buildings and spaces through matched investment. This is a long awaited manifesto pledge and along with partners we’ve been lobbying to see this come to fruition.
“We know what a difference this will make through our experience leading the Community Shares Booster programme, and we’ve been able to point to its success to demonstrate that community shares work. We’re looking forward to talking to government about how we can help deliver this.”
Using funding provided by Power to Change and the Architectural Heritage Fund, the Community Share Booster programme has provided £2.6m in matched investments, leveraging in a further £7.3m directly from the community, says Co-operatives UK.
A key difference of the Community Ownership Fund is that it will be UK-wide – whereas the Community Shares Booster programme has only been available in England, because it uses Lottery funding.
Ms Marley said she was delighted to see SITR extended until April 2023, which means investors can continue to claim back 30% of investments from HMRC when they invest in an eligible charity or social enterprise. This includes community benefit societies running community share offers.
“We know that communities rushing to launch their share offers by the April deadline will be breathing a huge sigh of relief today,” said Ms Marley. “The Treasury has said they will be publishing their response to the 2019 consultation on SITR on 23 March. We will continue to work with partners and members to access this tax relief and run successful community share offers.”
Locality, which represents community businesses in the UK, also welcomed the Community Ownership Fund.
Chief executive Tony Armstrong said: “Locality and our members have been passionately campaigning for this fund since 2016. It is wonderful that the government has listened to the voices of those who have experienced the power of community ownership.
“Community ownership can help save our local high streets and heritage, bring communities together and be a foundation for local economic renewal. Community assets have been sold off at huge rates over the last few years, and the pandemic puts these places in further danger. Through community ownership we can prevent the buildings and spaces we love, our libraries, youth centres, allotments and public swimming pools, from falling into private hands.
“We look forward to working alongside the government to ensure that this Fund lives up its promise and benefits the communities that need it the most. To do so, it must provide a mix of capital and revenue funding to support assets to be sustainable in the long-term. We will also be looking closely at the match funding element of the Fund – it is vital to ensure that communities with fewer resources are not disadvantaged.”
He added: “The chancellor said in his speech today that he wants to change the economic geography of this country. Any government serious about ‘levelling-up’ must start by putting power and resources in the hands of those who truly understand the issues – local communities themselves. As our Communities in Charge campaign has shown, successful regeneration needs to be locally rooted and community led.”
Most of the budget was taken up by measures to help businesses through the pandemic and lockdown measures.
Co-operatives UK notes that:
- the Coronavirus Job Retention scheme is to be extended to the end of September
- a £5bn Restart Grant scheme to help businesses in England reopen after lockdown, with grants of up to £18,000 for hospitality, accommodation, leisure, personal care and gym businesses, and up to £6,000 for non-essential businesses
- A new UK-wide Recovery Loan Scheme will replace CBILs and BBILs to make loans between £25,001 and £10m available
- An extra £300m has been added to the Culture Recovery Fund, with grants for arts, heritage and culture, which formally constituted co-ops should be eligible to apply for
- The VAT cut to 5% for hospitality, accommodation and attractions across the UK has been extended until the end of September, followed by a 12.5% rate for a further six months until 31 March 2022
- Businesses rates relief for eligible retail, hospitality and leisure sectors in England has been extended
- £126m for the Kickstart traineeship scheme, which sees government pay employers who give young people work placements
- The Help to Grow scheme provides £520m into free online courses to help small businesses to develop skills
- The prospectus for the £4.8bn UK-wide Levelling Up Fund has been published, providing guidance for local areas on how to submit bids for the first round of funding