The Financial Times reports on the creation of an innovative social impact bond which will help fund education and support for ex-offenders. The bond was created through a partnership between the UK Ministry of Justice and Social Finance, whose Development Director is GIIN board member Toby Eccles.

From original article:

In the latest effort to bring private money into cash-starved areas, the Social Impact Bond will be run jointly by the Ministry of Justice and Social Finance - an ethical investment organisation founded by private equity veteran Sir Ronald Cohen. The aim is to raise up to GBP 5m for expert charities working with Peterborough prison to provide mentoring, education and social support for 3,000 male prisoners who have been sentenced to less than a year in jail.

The investors - likely to be charitable trusts and foundations with an interest in criminal rehabilitation - will receive a dividend from the government only if the programme achieves more than a 7.5 per cent reduction in reoffending among prisoners involved in the scheme measured against an equivalent group on the police national computer.

The more money the programme saves state services, the higher the return paid to investors.

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