Lessons Learned From the Planning and Early Implementation of the Social Impact Bond At HM Peterborough
At a time when government finances are stretched there is growing interest in finding new ways to fund public services which improve social outcomes. One new funding model currently being tested is a Social Impact Bond (SIB). A SIB is a form of payment by results (PBR) in which funding is obtained from private investors to pay for interventions to improve social outcomes. If these interventions succeed in improving outcomes, this should result in savings to government and wider benefits to society. As part of a SIB, the government agrees to pay a proportion of these savings back to the investors. If outcomes do not improve, investors do not receive a return on their investment. In September 2010 the first ever SIB was launched in the UK. Approximately £5 million of investment funding from private individuals and charities is being used to pay for interventions for offenders serving short prison sentences (less than 12 months) at HMP Peterborough, a prison in eastern England. RAND Europe has been commissioned to evaluate the development, implementation and operation of this first ever SIB. This report is the first output from the evaluation. It identifies early lessons from the development and implementation of SIB at HMP Peterborough. Such lessons may inform future SIBs or wider payment-by-results (PBR) pilots under consideration by the Ministry of Justice and other government departments.