A backlash is building over moves to let private companies get their hands on third sector cash.
Lender Social Investment Scotland (SIS) has said it has Scottish Government backing to launch a new fund which will be open to the private sector.
SIS currently provides cash – much of it public money – to charities and social enterprises.
A proviso for funding has been that organisations have an “asset lock” – which means profits are put back into the business rather than going to shareholders or into the pockets of individuals.
Now, however, it seems that SIS is set to bust the asset lock by setting up a new fund for private companies – as long as they use the cash to do social good.
It will still offer funds to charities and social enteprises in the old way, but a backlash is building over its plans to open the new fund – backed by Scottish Government cash – to the private sector.
SIS chief executive Alastair Davis told TFN: “SIS has been awarded funding from the Scottish Government under a programme of early interventions to support the delivery of the new ten year strategy for social enterprise.
“SIS is planning a programme of awareness raising and education with a range of stakeholders… in the future, this work is expected to include the development of a new fund to support mission-led businesses and entrepreneurs.
“Please note that there has been no change to the eligibility criteria for all existing SIS funds and these remain open only to those organisations with an appropriate asset lock. There are no plans to change the eligibility criteria for these funds. SIS will continue to grow its support for these organisations with new programmes of investment and support.”
However, this has caused a furious backlash from leading third sector figures, who questioned whether cash which could go to the third sector is now been offered to the private sector.