Sunday, March 6, 2011

NSW premier announces social bonds plan

From SMH, 6 March 2011 (AAP):
NSW Premier Kristina Keneally says her government will invest $25 million in social bonds, in an investment pilot to pay for non-government early intervention programs, if re-elected.
Speaking to reporters in Newcastle on the eve of a three-day bus tour of the Hunter, Ms Keneally said the government would chip in $25 million to provide confidence to investors in the scheme, inspired by a similar UK bond.
Under the Labor pledge, which she says would be an Australia-first program, $10 million would go to preventative programs that help keep young people out of juvenile detention.
Another $10 million would go to help families at risk, while $5 million has already been allocated to the Department of Ageing, Disability and Home Care to develop bonds for disability services.
"The government will kick off with $25 million, and we'll do that, one, to provide confidence to investors that this is a program that will work. We'll have our own skin in the game," she told reporters in Newcastle on Sunday night.
"And also to provide that seed funding."
The bonds are not financial instruments like those seen in the traditional bond market, but allow private investors to invest in non-government community service programs.
If the services meet agreed targets and deliver public sector savings - making a measurable social difference - then investors would receive a return on their investment.
"Social Impact Bonds increase the amount of money available to governments to invest in early intervention without having to cut services they are already delivering," Ms Keneally said.
"Social Impact Bonds will complement, not replace, government support for community services."

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