13 June 2018
The Big Lottery Fund has contributed £6.25 million to the first Social Impact Bond scheme. A further £5 million has been allocated by the Fund to further projects planned through the scheme.
The Social Impact Bond was launched by Social Finance, the social investment bank, in March this year as a way of financing social projects. If the organisations being funded by the scheme meet government targets, their investors will make a return, paid for by the government.
This first issue of bonds will fund organisations such as St Giles Trust working to reduce the re-offending rates of short-sentence male prisoners leaving Peterborough Prison. If the project reduces re-offending by 7.5%, investors will receive a return on their investment. If offending is reduced by more than 7.5%, investors will receive an increasing return, up to a maximum of 13%.