Essex awards first social impact bonds in children’s services

Essex CC has today awarded the country’s first-ever social impact bond in children’s services to protect vulnerable adolescents at risk of going to jail.

Under the innovative way of funding interventions for 380 young people aged between 11 to 16, the £3.1m scheme, which begins next April, aims to divert around 100 young people from entering the care system over the next five years.

A home-based family therapy known as Multi-Systemic Therapy provided by leading children’s charity Action for Children, will be employed using the money which has been raised by non-profit body Social Finance.

Social investors underwriting the scheme – which include Big Society Capital and Bridges Ventures – will receive an annual cash return in the range of 8 to 12% based on how successfully the youths are supported. However, the investment is entirely at risk and should the intervention not deliver on pre-agreed outcomes, Essex CC would not pay.

Success of the bonds will be measured by the reduction of days spent in care by the young people, as well as improved educational attainments and reduced offending.

Essex CC leader Cllr Peter Martin said: ‘I am proud that Essex has had the vision to progress with a new social care model to deliver improved services and support for our most vulnerable young people. Essex has always strived to be innovative and forward thinking and it is this attitude that has allowed us to explore social investment.’