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£20m fund to help Yorkshire social enterprises
'We will be financing a variety of enterprises, from a social enterprise start-up, to an unemployed person setting up in self-employment or an existing small business needing cash flow or expansion support'
Keyfund CEO Ann Oldroyd
Social enterprises and other small and medium sized businesses in Yorkshire and the Humber hope to get almost £20m of new funding thanks to a partnership between eight community development finance institutions (CDFIs).
If the funding is agreed, £19.95m will be available over the next three years – £10m will come from the eight community based social lenders and another £9.95m comes as match-funding from the European Regional Development Fund (ERDF).
Speaking on behalf of the consortium Keyfund CEO Ann Oldroyd said: ‘It’s always good to know that you’re drawing money out of Europe and it’s always good to know you’re attracting money into the local economy.
‘We will be financing a variety of enterprises, from a social enterprise start-up, to an unemployed person setting up in self-employment or an existing small business needing cash flow or expansion support.
‘This will help strengthen the economy of Yorkshire and the Humber which suffers from unemployment at 9.2 per cent compared to the UK rate of 7.9 per cent.’
This fund is a particular coup after an ERDF match fund of half the size planned for the region was scuppered by the demolition of Regional Development Agency (RDA) budgets by the coalition government.
Initially the RDA, Yorkshire Forward, was going to put in £5m so as to attract £5m from the ERDF and the fund was to be run by the national representative of CDFIs – the CDFA.
When the RDA funding was withdrawn the whole scheme was in danger of going under. That was until the eight Yorkshire and Humber CDFIs got together and pooled their funding.
Oldroyd said: ‘When the funding fell through the eight of us said “what are we going to do about this?” So we looked at our reserves and decided to put our own money forward and not only have we safeguarded the money from Europe and made sure that it happened but we’ve increased the amount we could access.’
The official decision on the funding is not expected until June but the consortium has received a ‘letter of intent’ from Yorkshire Forward, which manages the ERDF Programme.
The consortium is operating ‘at risk’ until formal appraisal processes are completed, but having passed through public consultation and review by the ERDF Programme to reach this stage they are confident in moving to formal contract.
Members of the Yorkshire and Humber CDFI consortium:
Bradford Enterprise Agency Ltd
Goole Development Trust
Hull Business Development Fund Ltd (Acorn Fund)
North Lincolnshire Developments Ltd (Bees Knees)
Saltend Community Development Ltd (Sirius)
The Key Fund
The West Yorkshire Enterprise Agency