The name’s Bond – social investment bond

I was fascinated by an item on the Today programme on BBC Radio 4 the other day, about using social investment bonds to finance early intervention in the lives of unfortunate children. This was a bit of a holy grail for the Labour Government – there has been a  ‘Measuring Social Value consortium’ in the cabinet office (isn’t that lovely?) for the past few years now, whose basic aim is to monetise social outcomes. The coalition is keen too – they can’t otherwise find the money for early intervention, even though they rightly attach a great deal of importance to it.

The idea is that investors including charitable trusts and ‘high net worth individuals’ (hereafter ‘HiNWIs’) could put up the cash to fund a scheme to help very young children whose circumstances are such that they are likely to suffer low achievement, involvement in crime, unemployment, etc. At the end of such a scheme, the investor could not only get their money back, but also receive a dividend of around 7.5% – a huge return which few other bonds could legitimately hope to match.

Further plus points are that the risk is shifted from the government to the investor, and that the actual cost to the government is  delayed until after the project is proved to be working. In addition, it would free the government from paying twice: once for the intervention, twice for picking up the pieces when its transpires that the invention hasn’t worked.

This model is already being used by a scheme in Peterborough prison to prevent re-offending. A charity has invested £5m over three years. The problem with early intervention is that unlike re-offending (‘has this chap re-offended? (a) yes (b) no; what level of re-offending has this chap perpetrated? (a) oooh, dear (b) could be worse (c) not much really’) early intervention is very, very hard to evaluate. I’m using the word ‘evaluate’ in its original meaning here, that is, putting a figure on something.

Early intervention also has a much longer horizon – you may have to wait until your subject is 21, has a job and is engaged to be married to that nice young person down the street before you can say you’ve been successful.

My mind instantly turned to the problems and potential of the arts in all this. So many arts projects now have strong social aims, and these are unlikely to vanish even under the new world order where ‘front line arts’ have been granted the highest plinth. The arts know that they do this stuff well – I remember a project for excluded young people at the wonderful Mercury Theatre in Colchester quite a few years back where they even had to teach the young drama students to eat breakfast. However, they also know how difficult it is to quantify the impact.

Last September, PriceWaterhouseCooper  published a report on the impact of Creative Partnerships – part of the ultimately unsuccessful effort to rescue it from the axe. They said that the CP programme had made “a net positive economic benefit of just under £4bn”. Their case was rather elegantly deconstructed shortly afterwards by Liz Hill in issue 226 of Arts Professional (subscribers only I’m afraid), but the point had been made: creative work makes children’s lives better. Countless other reports, research and evaluation show that young people benefit and improve their attainment if they’re involved in the arts – a lot of it pointing to arts activity in the first few years of life. Of course, these reports were not made by the likes of PWC, so they may not have the same cachet in the City.

However – to get finally to my point – all these charities and HiNWIs are going to want to know in advance whether or not the schemes they’re thinking of investing in are actually going to work. We know that the arts work in providing positive social solutions. What we need here is for a call to arise from the massed ranks of trusts and HiNWIs: give us arts projects, and give them to us now.

Then the arts would clean up and we’d all live happily ever after – creative and crime-free.

It’s a bit late to say Happy New Year, but at least I can say Brave New World… with only a slightly wry smile.

Published in: on January 21, 2011 at 16:50  Comments (1)  

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One CommentLeave a comment

  1. Your logic is impeccable Lady E – that probably means this will never happen.

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