A fund of between £4bn and £5bn should be set up using dormant assets to support "left-behind" communities, according to an alliance of voluntary sector organisations.
Earlier this year, the government announced that it would expand the dormant assets scheme to include pensions, insurance, securities and wealth-management assets, which it is estimated could be worth up to £2bn for the charity sector.
Backers of the Community Wealth Fund, which include the National Council for Voluntary Organisations and several major grant-making foundations, said the idea could raise between £4bn and £5bn if "a range of resources were brought together" and could then support poorer communities across the country.
The proposal for the new fund comes after the announcement of the government’s Civil Society Strategy earlier this month, which promised £35m worth of dormant assets income to "develop new models of community funding".
But supporters of the new fund said it would go much further and use up to £5bn to try to meet some of the strategy’s objectives by creating substantial place-based investment programmes.
It would also seek to help the government’s strategy by introducing a new model of investment from a range of sources to raise social and economic outcomes, and develop new approaches in poorer and left-behind communities.
Supporters of the Community Wealth Fund include the Church Urban Fund, the Barrow Cadbury Trust, the Paul Hamlyn Foundation, the Lloyds Bank Foundation for England and Wales, the City Bridge Trust and the Local Trust.
Sir Stuart Etherington, chief executive of the NCVO, said: "In the wake of the Brexit referendum and the Grenfell fire there’s a real sense that something really ambitious is required to address the feeling of being ‘left behind’ that some communities obviously feel quite intensely.
"We believe that a significant endowment with the potential of the Community Wealth Fund is needed to support connection and place-making, and to put decision-making power and resources into the hands of local communities."
Matt Leach, chief executive of the Local Trust, said: "The Community Wealth Fund would enable people and places to design and commission activities, drawing on local strengths and assets and tailoring services to people’s actual needs.
"It could be targeted at those places most in need of support and provide the scale of investment required to develop the social capital needed for transformative social and economic change."