INVESTMENTS in social enterprises led to the creation of more than 450 jobs north of the Border during the year to the end of March and supported thousands of others, a report this week will reveal.
Social Investment Scotland’s (SIS) annual impact study shows that firms backed by the third-sector lender created 454 jobs during the year. That represents about 15 per cent of the 3,000 jobs which they also maintained.
Turnover generated by firms in the SIS portfolio reached £172 million, an increase of £22m on the previous year. Significantly, £100m of this came from trading income, which SIS chairman and entrepreneur Nick Kuenssberg said was up “by about half” on the previous year.
A further £55m came in the form of grant funding, with the remaining £17m attributed to other income sources.
SIS posted record results with £23m of new or renewed investment commitments for the current financial year.
Following a slight lull during the summer months, applications to tap into this money have returned to a brisk pace.
“We anticipate a further increase once the budgets for the next year are cleared, because there are obviously going to be more welfare spending cuts, which stimulates demand for the kind of services we support,” Kuenssberg told Scotland on Sunday.
Established in 2001 to create new financial models for Scotland’s charities and social enterprises, SIS has to date invested nearly £50m in roughly 180 organisations across Scotland which aim to promote employment, good health, positive relationships and quality facilities within their communities.
It manages the government’s Scottish Investment Fund, and recently launched SIS Community Capital, one of the first social investment tax relief funds in the UK.
According to the latest Social Enterprise in Scotland Census, these organisations generate annual income of £3.6 billion and employ more than 100,000 people across the country. But they have traditionally relied primarily upon grant funding, which has been dwindling amid government efforts to cut budget deficits.
However, there are signs that this is changing. The latest Social Enterprise Census noted more than 200 new organisations setting up annually, while two-thirds of all existing social enterprises expect their income to increase in the coming year.
One of SIS’s main goals is to help these firms towards sustainability.
Chief executive Alastair Davis said, in that sense, it has been “a huge year” both for SIS and the broader sector.
“With a wider understanding of what social investment can deliver, more social enterprises and community organisations are turning to this form of finance to help them achieve their social goals,” Davis said. “And it’s clear that these goals are being delivered in abundance.”
Nearly half of SIS borrowers who focus on employment, training and education said clients have moved into suitable assignments, while three-quarters of those targeting arts, heritage, sports and faith reported positive outcomes.