26.08.11
Social impact bonds launched to tackle deprivation
The Government is launching new social impact bonds in order to help poor and disadvantaged families in the UK. Private investors, voluntary organisations and charities will be asked to put cash into bonds, and will get paid a return for projects that are successful.
The scheme is set to be trialled next year in London, Birmingham and Leicestershire in the hopes of raising up to £40m to help break the cycle of deprivation. The project is based upon the idea that early intervention can avoid more serious problems later on.
Assisting severely deprived families currently costs over £4bn a year, with an average of nearly £100,000 per family. Many are affected by multiple issues, including drug addiction, unemployment and poor education.
Civil Society Minister Nick Hurd said: “We must not be afraid to do things differently to end the pointless cycle of crime and deprivation which wrecks communities and drains state services.
“Social impact bonds could open serious resources to tackle social problems in new and innovative ways. We want to restore a stronger sense of responsibility across our society and to give people working on the front line the power and resource they need to do their jobs properly.
“Social impact bonds could be one of many Big Society innovations that will build the new partnerships between the state, communities, businesses and charities and focus resources where they are needed.”
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