Oral Answers to Questions

Baroness McIntosh of Pickering Excerpts

Wednesday 2nd March 2011 Commons Chamber

[Peter Aldous (Waveney) (Con)]

4. What progress his Department has made in establishing a big society bank.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

5. What recent representations he has received on the big society bank; and if he will make a statement.

[The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)]

Sir Ronald Cohen and Nick O’Donohoe are working with us and with the banks to develop a proposal for the big society bank. As I have said, it will initially be capitalised by an investment from the mainstream banks. We are currently seeking to secure state aid approvals from the European Commission so that money from dormant bank and building society accounts can be directed towards the big society bank. Nothing along those lines had been done when the Government took office. In the meantime, we are working with the Big Lottery Fund to ensure that interim arrangements are in place by April, so that we can make early investments as soon as the first round of dormant bank account money becomes available in the summer.

[Mr Maude]

As my hon. Friend will know, a key part of our approach to public service reform will be encouraging voluntary and social enterprises to bid for the delivery of public services. They are being given a massive opportunity to develop different revenue streams and deliver public services in a responsive and agile way. The big society bank will deliver extra wholesale funding to the social investment market for start-up and development capital for such organisations. In the meantime, for some organisations the transition fund will provide bridging finance until those revenue streams become available.

[Miss McIntosh]

My question was about representations received, because there is a lot of interest in the big society bank in Thirsk, Malton and Filey, but there is also concern that if match funding is required, it will trigger the 2.5% referendum call on local government spending under the Localism Bill. Will this issue be addressed?

[Mr Maude]

I will look into that. The big society bank will provide private investment to bulk up the important social investment market. We have had numerous representations on this matter, most of them saying, “Please get on with it because we were very disappointed about waiting for so long for the last Government to do anything at all.”