Challenges to your public services

Large scale expansion of private financing for public service delivery using so-called mutual and ‘social enterprises’.

Increasingly, successive Conservative Governments have promoted the use of private funding through Social Investment and Social Impact Bonds (SIB’s), collectively known as ‘social finance’. These investments and loans are performance related (profit with purpose), risking the integrity of our well respected public services so private investors can reap financial rewards.

In the UK and US, similar programmes are being extended into criminal justice, education, homelessness and rehabilitation services. Most of these services would normally be delivered by public sector workers on a not-for-profit basis!

With 32 Social Impact Bond Projects, the current UK SIB market is worth an estimated £153M. For 2016, Big Society Capital (the Government’s Social Investment wholesale agent) reported £306M of ‘risk investments’ including community shares, equity investments, SIB’s and investments by banks and others into ‘profit with purpose’ organisations.

Most of this is underwritten and supported by the 2008 Dormant Bank Accounts Act (using dead people’s bank accounts) and Big Lottery Funding! There is little public awareness that these dormant bank accounts and Lottery funding are being used in this way.

Peterborough Social Impact Bond Scheme introduced in April 2010 and supported by the Big Lottery, under which 17 ‘impact investors’, mostly foundations and private trusts, contributed £5M and will receive 3% interest for rehabilitation of 3000 offenders. Under the Transforming Rehabilitation programme, as part of 10,000 job cuts in probation, prison and court services, most Probation Services were dismantled or reduced, with payments to 21 new ‘Community Rehabilitation Companies’ run by private contractors, paid £3.15bn over 7 years on a similar basis to the Work Programme.


St Mungo’s and Thames Reach charities are part of a £5M London Homeless SIB project for 830 individuals, under which, working with the Home Office they receive payments when people are deported to their country of origin.


Worcestershire County Council is operating a £2.02M SIB project to reduce loneliness and social isolation, with services delivered by local organisations, which receive payment of £460 after six months linked to each case of reduced loneliness.


Sandwell and West Birmingham Clinical Commissioning Group abandoned an End of Life Care Social Impact Bonds Scheme, under which there would be payments to investors if people died in their own homes rather than in hospital.


Essex County Council’s SIB is paying £7.1M through ‘Social Finance’ to a range of national and local organisations to keep 380 vulnerable 15 to 17 year old’s with their families.

The history of privatisation in this country has led to inferior services, lower wages and higher prices for consumers.

 

green circle saying save our local services

 


michael foot quote


UNISON SAYS HANDS OFF ALL OUR PUBLIC SERVICES!