Issue - meetings

Report of the Director of Economy and Enterprise is circulated.

The Leader presented a report which sought approval for the Council’s participation in a Wiltshire Finance Initiative to address the market failure in terms of the availability of affordable credit to individuals and small businesses in Wiltshire.

In response to this issue being highlighted in the Bright Report published in March 2009, a partnership group led by the Council put together plans to address this through the ‘Action for Wiltshire’ programme. There were initial difficulties due the lack of capacity and limited funding. However, it was now possible to pursue the initiative as an opportunity had since emerged to draw down funding from the Department of Work and Pensions to provide affordable credit for individuals. The Fredericks Foundation had also come forward offering a potential solution to the problem of accessing affordable credit for businesses.

Cabinet approval was sought over the necessary expenditure to help with bringing this initiative to fruition.

Resolved:

That Cabinet:

1.                  agree to support the Growth Fund by:

a)                 funding a capped amount towards the revenue costs associated with the delivery of the Growth Fund amounting to £42,000 over two years;

b)                 offering pro bono office space including access to private meeting rooms for use by the Credit Unions; and

c)                 exploring the extension of Credit Union membership to staff;

This support would be subject to the success of the current bid to DWP.

2          Agree to support the Fredericks Foundation Small Business Loan Fund by:

a)         approving revenue expenditure of £42,240 towards the costs of a         Wiltshire loans officer working 4 days per week over 2 years; and

b)        approving a loan of £100,000 to match GWE funding and establishing the Small Business Loan Fund.

3.         agrees to the setting up of a Wiltshire Advisory Board to oversee these projects and enable the delivery of a comprehensive package of financial inclusion measures as part of a comprehensive Financial Inclusion Strategy.

4.                  Asks the Chief Finance Officer to strongly encourage the Council's bankers to second a suitable employee to support this initiative. 

Reasons for Decision

By supporting the Growth Fund this will help to attract substantial DWP funding for personal lending in Wiltshire and would be contributing to an improvement in financial literacy, provide an alternative to costly door step lending and help to build a single credit union in Wiltshire. 

The Council’s involvement would also help to introduce this new service to those that approach the Council for help with the management of personal finances e.g. Council Tax and Housing Benefit claimants etc.

The establishment of the Small Business Loan Fund would address a major problem faced by small businesses i.e. the availability of credit. Each year, it is expected that the fund would provide up to £5000 each to 15 businesses with the result that 28 new jobs would be created with an estimated saving of £50,000 - £75,000 in benefits to the public purse.

Overall, the Wiltshire Finance Initiative would assist in building more resilient communities and help to secure economic recovery.