Impact Bonds to Get G8 Push
Wednesday, 20th February 2013 at 10:07 am
British Prime Minister David Cameron has told local media that he plans to use the UK’s Presidency of the G8 to push the profile of Social Impact Bonds (SIBS) in the G8 countries.
In an interview with London’s Sunday Telegraph newspaper, Cameron said that his Government had put an emphasis on SIBS to tackle the nation’s social problems despite economic and debt pressures.
“There is growing interest in Britain’s social investment model around the world,” Cameron told the Telegraph.
“So I want to use our G8 presidency to push this agenda forward,” he said.
A SIB is a multi-stakeholder partnership in which philanthropic funders and impact investors—not governments—take on the financial risk of expanding preventive programs that help poor and vulnerable people.
The UK will host the 39th G8 summit this June to be held in Northern Ireland. The ‘Group of Eight’ are made up of Canada, France, Germany, Italy, Japan, Russia, the US and the UK. The nations meet for a summit meeting once a year.
“We will work with other G8 nations to grow the social investment market and increase investment, allowing the best social innovations to spread and help tackle our shared social and economic challenges,” Cameron told the Sunday Telegraph.
“Britain and other developed nations face a shared challenge – sorting out our debt problems and achieving economic growth. We need to do this at the same time as improving public services and tackling our deepest social problems.
“That’s why this Government has placed such an emphasis on social innovation from charities, social enterprises and other businesses.
“Making this work requires a new kind of financial investment to help grow a bigger, stronger society. Britain is a global leader in this field.
“We launched the world’s first social investment bank Big Society Capital and we invented the world’s first social impact bond to help fund payments by results in public services where government only pays for what works.”
In 2010 the first SIB was signed with the UK Ministry of Justice to provide a program to work with inmates of the Peterborough Prison who were soon to be released. The social program worked with them to reduce the likelihood that they would reoffend and end up back in jail.
At last year’s Social Finance Forum in Sydney, the New South Wales Minister for Family and Community Services Pru Goward said that SIBS could be a ‘game changer’ in funding, benchmarking transparency and driving innovation in the Australian Not for Profit sector.