The government is consulting on plans to distribute more than £700m to charities and social enterprises in England from the dormant assets programme.
The scheme, which was launched in 2008 to redirect cash from long-forgotten bank accounts to good causes, has been expanded to include other dormant financial assets including pensions, insurance plans and investments.
Ministers estimate that the expanded programme will free up another £880m for UK charities and plan to distribute £738m in England, although the consultation document warns that “this money will not immediately become available and is expected to take several years to be released”.
The dormant assets scheme has distributed just under £900m to charities and social enterprises so far.
The government consultation asks for specific ideas on using the new funding for youth projects, help with financial inclusion and social investment, all of which are already backed by dormant assets cash, as well as the creation of community wealth funds.
The paper describes community wealth funds as “pots of money distributed over long-term periods (circa 10 years), with spending decisions made by local residents on how to improve their communities and lives”.
Influential charity figures have lobbied for versions of community wealth funds for several years, including Danny Kruger, a Conservative MP and a former Downing Street adviser on civil society, who in 2020 suggested dormant assets could be used to create a Levelling Up Communities Fund. The House of Lords backed the idea last year.
The consultation opened on the weekend and will run for 12 weeks.
It says that dormant assets funding must cover initiatives that central government is unlikely to fund, that have nationwide impact, and that are “capable of weathering the highly uncertain funding flows and timings associated with this unique type of public money”.
The Access Foundation has received millions of pounds through the dormant assets scheme to help charities and social enterprises use a blend of grants and loans for their work.
Seb Elsworth, chief executive of Access, said “The launch of the consultation on dormant assets is a pivotal moment and a genuine opportunity to secure much-needed investment for places and communities that have been deprived of it in the past.
“Tackling the cost-of-living crisis and delivering real change in places affected by economic decline requires urgent action. We must make the case that it is charities and social enterprises – with their extensive reach into underserved places – that can deliver tangible change by creating jobs and growth.”
Matt Leach, chief executive of Local Trust and a founding member of the Community Wealth Fund Alliance, said that the alliance’s plans were backed by more than 200 parliamentarians from all political parties.
He described the consultation as “an important first step towards rebuilding the social scaffolding of the most ‘left behind’ areas, and trusting local people to make the decisions about how best this can be achieved”.
Leach said: “Community spaces, youth hubs, libraries, parks, community cafes, locally owned pubs and recreational facilities. This is the stuff that helps bring life to communities, and the evidence is that this is often the highest priority for local people when it comes to improving their neighbourhoods.”
Stephen Muers, chief executive of Big Society Capital, said the consultation was “a unique opportunity for new dormant assets released through the scheme to be invested quickly and sustainably in the places and people that need them most”.
Nigel Huddleston, minister for sport, tourism, heritage and civil society, said: “This consultation will allow everyone’s voice to be heard so that the scheme can make a difference where it matters.
“With the cost-of-living crisis, it is more important than ever that we hear views from communities up and down the country on what causes we should support.
“I encourage everyone to participate in this unique opportunity to have your say on the future of dormant assets funding in England.”