QLD Trials Social Benefit Bonds
Wednesday, 29th July 2015 at 11:11 am
The Queensland Government will undertake a pilot program to explore new service delivery and investment options such as Social Benefit Bonds to tackle complex social issues – including re-offending and homelessness.
Treasurer Curtis Pitt said Queensland Treasury would lead the pilot and work in close collaboration with service delivery agencies and stakeholders to assess pragmatic and innovative new service delivery solutions for those community members in need.
“Queensland Treasury will be allocated $2 million over two years to implement this cross-agency initiative in collaboration with partner agencies,” Pitt said.
“A Social Benefit Bonds Readiness Fund of $1 million will also be available to assist shortlisted service providers in the co-design phase of the initiative.”
The funding was detailed in the Palaszczuk Government’s first State Budget.
“The Government will pilot three Social Benefit Bonds which will be designed to address targeted social issues where early intervention can promote alternatives pathways for vulnerable Queenslanders,” Pitt said.
“These pilots Social Benefit Bonds will focus on providing beneficial outcomes to leverage funds from private investors and provide a return when agreed social outcomes and key performance indicators are met.
“The clear focus will be to enhance the current service offering and deliver broad social benefits and ongoing savings to the community.”
Pitt said under the scheme taxpayers will only pay for outcomes when service providers can clearly demonstrate achievement of agreed outcomes defined in the Social Benefit Bonds.
“This investment mechanism is emerging internationally as a new approach to addressing complex social issues. It allows governments to partner with service providers and private investors willing to cover upfront costs,” he said.
“We will be adding to the suite of existing services and are looking to collaborate with non-government organisations and the private sector to deliver additional financing for new solutions to difficult community problems.
The Social Benefit Bonds will look to partner with service providers and the private sector in the areas of re-offending, homelessness and issues facing Aboriginal and Torres Strait Islander people.
“By facilitating investment in early intervention and stopping re-offending we hope to reduce future demand for acute services and deliver savings to government by keeping people out of jail and at home with better access to friends and family,” Pitt said.
“By providing an innovative investment option – such as Social Benefit Bonds – social challenges can be addressed by sourcing private investment and providing a return on that investment when agreed outcomes are achieved.
“We know that for these pilots to succeed, we will need to collaborate with service providers and the investment market to design, develop and evaluate Social Benefit Bonds in Queensland.”
Queensland Treasury will consult with stakeholders and plans to commence a Request for Proposals process by early 2016.