Ministers are damaging social investment by exaggerating the potential of social impact bonds, a leading social investor has told a committee of peers.
The Social Investment Business criticised the minister for civil society for saying that social impact bonds will be worth £1bn by the end of the Parliament.
In written evidence to the House of Lords Select Committee on Charities, the Social Investment Business, an organisation that exists to encourage the uptake of social investment, said that the minister’s £1bn target was unrealistic.
Rob Wilson, minister for civil society, first revealed that he expected the social impact bond market to be worth £1bn by the end of this Parliament in an interview with Civil Society News in January.
But Social Investment Business told the Lords’ committee that there was “too much hype and lack of relevance” around some statements made by ministers.
It also refers to statements made by then Secretary of State for Work and Pensions, Iain Duncan Smith, who was quoted in the Telegraph as saying social investment will “make perhaps the single most significant difference to how we fund and deliver social services.”
SIB said: “Social investment and social impact bonds have a significant role to play but to publicly anticipate their growth to such scale sets them up to fail.
“While social investment is an important tool everyone working in this area needs to make sure that the rhetoric about social investment matches the experience, understanding and need of the charities and social enterprises it is supposed to support.”
Jonathan Jenkins, chief executive of Social Investment Business, will be giving oral evidence to the committee tomorrow afternoon.
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