Scottish National Investment Bank Bill: revised EQIA

Annex

The Building Scotland Fund

1. The Building Scotland Fund (BSF) is a precursor to the Scottish National Investment Bank and will provide some of its initial capitalisation. Launched in 2018, the £150 million Fund across three years to 2021 provides loans or equity, supporting development of housing across all tenures, modern industrial and commercial space and industry-led research and development. BSF is available to non-public sector organisations including businesses, housing associations and universities. The Fund continues to actively seek eligible opportunities for investment and is working with Scottish Enterprise, Highlands and Islands Enterprise, Scottish Funding Council, Scottish Government More Homes and the Scottish Futures Trust to advance a strong pipeline of significant investment projects and opportunities.

2. As a precursor to the Scottish National Investment Bank, BSF is committed to reflecting its emerging values, principles and ambitions including place making, supporting the transition to a zero-carbon society and the promotion of ethical and inclusive business practices. 

3. The EQIA process carried out for the establishment of the Bank identified some potential barriers to businesses gaining finance from lending institutions and BSF is working to ensure that those barriers do not impede its activities. The BSF ensure that the application process is as open, transparent and accessible as possible to all, with clear objectives, eligibility criteria and other information available on our website, and a short ‘expression of interest’ form. We welcome and consider applicants who meet the basic criteria from SMEs to large companies. 

4. We assess each application on a case by case basis against agreed, transparent criteria, and we communicate the reasons for our decision to applicants. Applications are considered from companies that are out-with of Scotland as long as they can demonstrate that the investment will deliver economic benefit to Scotland.

5. The BSF was deliberately given a broad and flexible mandate during the first year as it established its delivery mechanisms and raised awareness as well as delivering investments. As BSF evolves and we move towards the establishment of the Scottish National Investment Bank, we have focused on how BSF can be used to act as a catalyst for wider business practice change by requiring applicants to meet the following Fair Work investment standards: 

• Payment of the Real Living Wage
• No inappropriate use of Zero Hours Contracts 
• Action to address gender pay gap

6. We also actively encourage applicants to sign up to the wider Scottish Business Pledge as an example of best practice in terms of Fair Work.

7. In order to assist with prioritising of investments we ask applicants to provide details, where relevant and applicable, on how their projects are:

• Supporting their local community
• Helping to address demographic issues in Scotland, for example taking into account the needs of people with disabilities or our ageing populations, and;
• Implementing wider community benefits, for example apprenticeships, recruitment/ training/ work experience or development opportunities for priority groups or those with protected characteristics.

8. This encourages applicants to take a more holistic and inclusive approach towards the potential wider benefits of their projects and at the same time ensure that BSF and by extension the Scottish National Investment Bank’s emerging reputation and strong capitalisation basis is built.