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Social Impact Bond. EUROPEAN OFFENDER EMPLOYMENT FORUM 24 th March 2011. Janette Powell – Social Finance Colin Lambert – St Giles Trust. 1. 1. Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568. Who are Social Finance?.

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Social impact bond

Social Impact Bond

EUROPEAN OFFENDER EMPLOYMENT FORUM

24th March 2011

Janette Powell – Social Finance

Colin Lambert – St Giles Trust

1

1

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


Who are social finance

Who are Social Finance?

Social Finance was formed with an overriding purpose – to connect investment with need in a way that supports social progress

  • Our aim is to make more non-governmental money available reliably and quickly to those who need it.

  • By making more financial resources available for intelligent interventions, we hope to enable better social outcomes.

  • We believe that the market and society need each other and can work more closely together.

  • We develop structures that enable investors to fund social progress and receive returns that can be invested again in society. In this way we make more money available, more sustainably, to address entrenched social issues.

  • Social Finance is an FSA regulated, nonprofit organisation.

2

2

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


What is a social impact bond

What is a Social Impact Bond?

The Social Impact Bond Model

  • A Social Impact Bond is a contract with the public sector in which it commits to pay for improved social outcomes.

  • On the back of this contract, investment is raised from socially-motivated investors.

  • This investment is used to pay for a range of interventions to improve the social outcomes.

  • The financial returns investors receive are dependent on the degree to which outcomes improve.


Why do we need a sib

Why do we need a SIB?

The Social Impact Bond enables a shift in focus from crisis provision to preventative spend

Cycle of

re-offending

At risk of offending

Receive police caution

Serve community sentence

Serve prison sentence

Social Impact Bond

Social Impact Bond

Social Impact Bond

Social Impact Bond

Transfer of resources catalysed by Social Impact Bonds


Social impact bond

Social Impact Bond – Criminal Justice System

Public Sector

£

£

£

£

£

£

£

£

£

£

£

£

Service Users

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


Social impact bond

SIB – Criminal Justice System

Public Sector

Investors

SIB Delivery Agency

£

£

£

£

£

£

Money drawn down evenly over project life

£

On going operating funding

£

£

Service Providers

Service Users

Host prison - HMP Peterborough operated by Sodexo Justice Services

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


Social impact bond

SIB – Criminal Justice System

Public Sector

Investors

SIB Delivery Agency

Service Providers

Service Users

IA

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


Social impact bond

SIB – Criminal Justice System

Make payment based on defined outcomes

Financial returns dependent on outcomes

Public Sector

Investors

SIB Delivery Agency

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

£

Service Providers

Improved social outcomes

Reduced public sector costs

Wider benefits to society

Service Users

IA

Reduction in re-conviction

Social Finance is Authorised and Regulated by the Financial Services Authority. FSA No: 497568


How do you get paid

How do you get paid?

The payment structure is crucial to ensuring that the Social Impact Bond encourages and enables quality services to achieve outcomes and address the most deep-seated problems

The price should be value rather than cost-based. This encourages the development of more cost-effective outcome delivery models.

e.g. the price should be based on the value to the government per reduced re-offender not the on the cost of services delivered

Price per outcome

e.g. if the payment is based on reduction in re-offending then it is more “profitable” to work with a low level offender and stop him offending than invest in effectively resettling a frequent offender. However, if the payment is based on a reduction in conviction events the perverse incentive is removed.

The pricing structure should be designed to encourage service providers to work with the entire target population rather than focus on quick wins. Also ensures that investors are rewarded for all the value they create.

Pricing structure

Payment timing

e.g. rather than receiving government funding to deliver the service government only pays when the outcome is achieved.

The payment is received when the outcome is achieved and measured


Can it be used anywhere

Can it be used anywhere?

This model does not apply to every social issue and is only one of a range of funding options

  • Cost of intervention is smaller than public sector savings

  • The cost savings accrue within a relatively short time horizon

  • The cost savings are cashable (particularly in the current economic environment)

  • There are good outcome metrics on which to base a contract

  • Preventative interventions have been shown to improve the outcome

When Social Impact Bonds Apply

Traditional funding streams will still be critical in funding many services


Social impact bond

Example – The One Service

The service is funded by investment raised through a Social Impact Bond. Interventions are delivered by a number of social sector providers with a proven track record, united under the brand “One” to provide a co-ordinated service to prisoners. Financial returns to investors are funded by the Ministry of Justice and the Big Lottery Fund and are based on improved reoffending rates. If reoffending rates do not improve, then investors will receive no recompense.


Social impact bond

Multi-agency Interventions

St Giles Trust

STG Mentors

Ormiston

STG /Mentors

Ormiston

Volunteers

Ormiston

Volunteers

Community

Prison Staff

St Giles Trust

St Giles Trust

Bail Support

Peer Volunteers

St Giles Trust

STAGE 1

STAGE2

STAGE 3

STAGE 4

BAIL in Community

PRISON INDUCTION

HOUSING

DRUG TREATMENT

GYM

EDUCATION

WORK

FAITH

HEALTHCARE

etc

HOUSING

DRUGS

FAMILY MEDICATION

MENTAL HEALTH

BENEFITS

DEBT

EMPLOYMENT

etc

HOUSING

DRUGS

DENTIST

MENTAL HEALTH

EMPLOYMENT

FAMILY

LIFE SKILLS

BUDGETING

etc

TENANCY SUPPORT

ATTITUDES

COUNSELLING

TRAINING

FAMILY

FAITH GROUPS

FRIENDS

etc

HEALTHY LIVING

COUNSELLING

WORK

FAMILY

VOLUNTEERING

VOTING

HOBBIES

COMMUNITY GROUPS

etc

ONE ASSESSMENT

DAY OF RELEASE

Example offender journey

12 months support post release


Where do st giles fit in

First agency involved

Helped mould the project

We are delivering the ‘through the gates’ element of the service

Why us?

Where do St Giles fit in?


Ttg family tree

TTG Family Tree


The proof

The Proof:


The peterborough project

The Peterborough Project

  • NVQ 3 in IAG in the prison

  • Through the gates workers

  • Resettlement Support

  • Other agencies in the community and volunteers to help keep people out of trouble for 12 months after release


In prison

In prison

  • Serving prisoners trained as peer advisers using NVQ 3 in Information, Advice and Guidance

  • Pre release assessments done by TTG workers or Peer Advisers

  • Work begins on planning for release, make referrals

  • Links made with in-prison services


On the day of release

On the day of release

  • Met at the gates

  • Taken to key appointments

  • Accommodation found – often temporary

  • Support given by paid TTG workers and volunteers, some of whom have come from Peterborough prison and gained the NVQ


First 3 months post release

First 3 months post release

  • Work on permanent housing

  • Ensure benefits claimed

  • Refer into other services – subs use, MH

  • Refer into ETE

  • Support around staying out of trouble

  • Lots of hand holding


When stabilised

When stabilised

  • Lighter touch support

  • Low level monitoring for one year

  • Referral onto community mentoring

  • Be available if there are wobbles

  • Need early warning system

  • This is the ‘new’ bit


Case study

Case Study

  • 28 years old

  • First offended at 13

  • Been in prison every year since 17

  • Diagnosed with schizophrenia, Class A drug user, PPO

  • Now out of prison for 4 months, longest period in his adult life


Overall aim

Overall Aim

  • The only thing we are measured on is whether we can reduce re-offending

  • What we deliver is a classic menu of practical help with housing and other services and support to move away from offending.

  • Because these are the things we know work


Social impact bond

Questions?

www.socialfinance.org.uk

www.onesib.org

www.stgilestrust.org.uk


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