Agenda item

Community Loan Scheme

Decision:

The Executive is advised to RESOLVE that

 

(i)            a Community Loan scheme, as set out at Annex A to the agenda report, as amended, be set up to support eligible charities and community organisations facing permanent closure; and

 

(ii)          any decision making regarding the scheme to be delegated to the Executive Head of Finance in consultation with the Leader.

 

Minutes:

The Executive received a report proposing the introduction of a conditional emergency low-interest loan to help sustain key community organisations which may otherwise be forced to close permanently due to financial implications of the Covid-19 pandemic. The scheme was proposed in response to reports that the ongoing financial impact of the pandemic was causing some of these organisations to consider whether they could viably continue to operate. The proposed conditions of the scheme had been attached at Annex A to the report.

 

The scheme would only be available to charities or not-for-profit community organisations carrying out work in local areas that the Council considered essential. Furthermore, it would not be applicable to businesses or commercial entities which had other means of applying for support such as rate relief, the Bounce Back Loan Scheme, or other government initiatives.

 

Members considered the report and, whilst the principle was supported, a number of concerns were raised, in particular in relation to charity law. Suggestions were also made that the Council should be offering grants instead of loans. Arising from the discussions, it was agreed to amend the terms of the scheme to include the following provisions:

 

      i.        It would explicitly state that the loan would not be held on the personal liability of any trustees.

    ii.        It would state that the charity or organisation’s constitution must allow it to take on a loan.

   iii.        It would state that, in taking the loan, a charity must be confident that it was not contravening Charity Commission rules.

 

It was agreed to change the name of the scheme from the proposed ‘Pay Back Grant’ to ‘Community Loan scheme’. It was also agreed that a maximum of £150,000 would be allocated to the scheme.

 

Members were reminded that the Council’s Community Fund Grant Scheme provided grants of up to £25,000 to assist local not for profit organisations with the delivery of community projects and it was suggested that the number of funding cycles should be increased in 2021. It was noted that a review of all grants would be considered by the Executive in February 2021.

 

RESOLVED that

 

(i)        a Community Loan scheme, as set out at Annex A to the agenda report, as amended, be set up to support eligible charities and community organisations facing permanent closure; and

 

(ii)      any decision making regarding the scheme to be delegated to the Executive Head of Finance in consultation with the Leader.

 

 

Supporting documents: