The Cabinet Office has finally launched the Local Sustainability Fund more than a year after it was proposed.
The £20m fund will provide grants to around 250 organisations working in the voluntary, community and social enterprise sector. It was originally expected to be £40m.
The Cabinet Office said in a statement that the fund, which will be delivered by the Big Lottery Fund, will provide grants that will enable recipients to "implement organisational changes" and access "professional advice".
The funding will be delivered over two years and will be available to medium-sized charities and voluntary sector organisations that deliver support to vulnerable and disadvantaged people.
As well as working with local businesses, the Cabinet Office said, recipients will also work with skilled advisers so that the fund generates maximum impact.
Rob Wilson, Minister for Civil Society, said in a statement: "The Local Sustainability Fund will establish cross-sector partnerships and build skills crucial to delivering sustainability in the sector.
"This fund will enable around 250 medium-sized organisations in England to be in a position to change, helping to build a truly compassionate society."
Nick Hurd, a former Minister for Civil Society, announced last year that a Local Sustainability Fund would be created. In an interview in March last year, when he was still minister, he told Third Sector that he expected it to be worth about £40m.
In May 2014, the Cabinet Office carried out a 12-week consultation about the fund, but the launch has been continually delayed. The delay was criticised by some sector umbrella bodies.
Neil Cleeveley, chief executive of the local infrastructure body Navca, said in a statement: "I’m relieved this fund is finally being launched even if it is less money than originally promised. Rob Wilson deserves praise for being able to get this through the Treasury so charities in need can get some help."
Sir Stephen Bubb, chief executive of the charity leaders body Acevo, said in a statement: "We are glad to see the Local Sustainability Fund re-emerging after its absence from last year's budget. The £20m will be welcomed by the sector despite the smaller-than-expected size of the fund. We hope there is more to come."