Health Planning Social Bonds Trial

18 October 2013

Health Planning Social Bonds Trial

The Government has given the green light to pilot social bonds, an innovative form of social sector investment.

Social bonds are a way for private sector capital and expertise to be used for a social purpose. The Ministry of Health has this year been exploring the potential for social bonds in New Zealand, including testing interest from providers of services and potential investors.

Ministry Group Manager Policy Sarah Holden says the Government is focussed on how to tackle difficult social problems and to achieve better results. New forms of investment like social bonds, are increasingly being recognised internationally as one of the ways to do this.

“Social bonds allow philanthropic and private investors to work with Government to achieve better social outcomes – and to be rewarded by the Government for the results.

"They are already being used in the UK, US and Australia on issues ranging from reducing reoffending and unemployment, to improving outcomes for children in care, and lifting the wellbeing of those with chronic health conditions.

"The idea is relatively new and overseas projects are still in their early days, but it’s time for New Zealand to see if the promising results seen to date can be delivered here.”

Ms Holden says Health will work with other government agencies in developing a social bonds pilot. It is expected to start next year. The first step will be a Registration of Interest process for social service providers who want to be part of a pilot.

In the lead up to that market briefings for providers will be held in Auckland, Wellington and Christchurch next month. Organisations wishing to attend should register by 23 October, using the form available on the GETS website, http://www.gets.govt.nz.

For more information contact:

Background

There is much work still to be done on how a New Zealand social bond might work. However, put simply, social bonds see private and not-for-profit organisations partner to fund and deliver services to improve social outcomes. If they achieve agreed results – government will pay the investors back their investment – plus a return.

The partnership of these organisations will include investors, service providers, and an intermediary to assist with raising funding and driving performance. Independent assessors review and verify results. Investor returns depend on the level of results, up to an agreed maximum.

More information about social bonds is available here:

http://www.health.govt.nz/our-work/preventative-health-wellness/social-bonds-project

Agencies interested in social bonds should email social bonds@moh.govt.nz

GETS: http://www.gets.govt.nz

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