Last edited 24 Feb 2021

Publicly subsidised project

Unlike a public project that is typically owned and financed by the government, a publicly subsidised project is one which receives partial funding from a public concern. So, for example, a church council faced with significant costs for repair and conservation could apply for and receive lottery funding to cover a portion of its costs.

In situations such as this, receiving money in part from a government organisation, whether a lottery fund or some other public source, makes the project ‘publicly subsidised’; the funds come from the public purse (the National Lottery is operated on behalf of the government by a private company which receives commissions for its work). While the Lottery provides funds to worthy construction projects, in most cases the funding is only partial for any given project.

In the UK, publicly subsidised projects can take many forms. Housing is an example. The diminution of the social housing sector in the 1980s saw the rise of numerous housing associations. Yet despite its aversion to council (public) housing, the government has adopted a policy of supporting housing associations by allowing public funds to be channelled to them as housing development subsidies.

Social housing may be owned and managed by the state, or it may be funded by a combination of the state and non-profit organisations. Another example may be the collaboration between a university department and a private firm on a research project that is expected could have some public benefit so is partly funded by the Government. Such projects are therefore publicly subsidised projects not wholly subsidised from government funds.

The UK government has had a policy in recent years of expanding the types of tenures that are available: Affordable Rent, Shared Ownership are two examples of partial subsidy. As is the Rent to Buy scheme, which allows tenants to enjoy rents that are set at or below 80% of the local market rent, giving them the opportunity to save for a deposit and later the option to buy their own home. These are further examples of publicly subsidised projects in the housing sector.

Like public projects, publicly subsidised projects may be subject to OJEU procurement procedures.

For more information about what might constitute a public funding organisation see: Public authority and Public body.

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