Just in case you missed the Federal Government’s 2018 Fall Economic Statement, which included an announcement of $805 million for social innovation, we wanted to share a few key highlights.
There were a couple key announcements included in the 2018 Fall Economic Statement that will impact the work we do here at Eco-Ethonomics as well as that of our clients:
- The Government of Canada announced in August 2018 that it would amend the Income Tax Actto remove the limits on political activities, allowing charities to participate fully in public policy development. Legislation to implement these measures was introduced on October 29, 2018 as part of the Budget Implementation Act, 2018, No. 2.
- The establishment of a permanent advisory committee on the Charitable Sector. The Government is providing $4.6 million in new funding over the 2018–19 to 2023–24 period for the Advisory Committee to strengthen the relationship between government and the charitable sector.
- To help charitable, non-profit and other social purpose organizations access new financing and to help connect them with private investors looking to invest in projects that will drive positive social change, the Government proposes to make available up to $755 million on a cash basis over the next 10 years to establish a Social Finance Fund. Additionally, the Government proposes to invest $50 million over two years in an Investment and Readiness stream, which is for social purpose organizations to improve their ability to successfully participate in the social finance market. Details on the governance and parameters of the Fund will be developed further in the coming months and released in early 2019.
- Restatement of the commitment to the $40 billion National Housing Strategy.
Focusing on the Social Finance Fund a little closer, the Fund will:
- Support innovative solutions on a broad range of social challenges through a competitive, transparent and merit-based process.
- Attract new private sector investment to the social finance sector. It is expected that the Fund would achieve matching funding from other investors.
- Share both risks and rewards with private investors on any investments.
- Only support investments that are not yet viable in the commercial market.
- Help create a self-sustaining social finance market over time that would not require ongoing government support.
Examples of funds that the Social Finance Fund could support:
- The First Nations Market Housing Expansion Fund (Quebec)is a proposed expansion of a loan fund managed by the Aboriginal Savings Corporation of Canada that would provide mortgage loans to residents of Indigenous communities, enabling a growing number of residents to become homeowners and improving overall housing quality in Indigenous communities.
- The Chantier de L’Économie Sociale Trust (Quebec)provides patient capital financing to support start-up, expansion and real estate activities of co-operatives and non-profit businesses. The Trust has provided support for programs to help at-risk youth, including Indigenous youth, acquire skills through integrated learning opportunities, and loans to local communities to help restore services.
- The Saint John Community Loan Fund (New Brunswick)works towards helping individuals and organizations create income and build assets and self-reliance using finance, training and support. For example, the Fund provided: a loan to leverage a mortgage to develop affordable housing units; support for establishing a literacy organization; and capital for an innovation hub to help launch and develop new social enterprises.
- The Alberta Social Enterprise Fund (Alberta)provides access to loan capital for social entrepreneurs to address challenges in the environment, social issues, local food security, culture and other public benefit missions. For example, the Fund has provided support to mental health organizations to help provide accessible housing for clients, employment opportunities for persons with disabilities, and therapeutic programs for adults and children with physical and mental disabilities.
View the complete Federal Government 2018 Fall Economic Statement here.