Children’s minister Sarah Teather confirmed that £3.5m will be made available to fund an independent foundation over two years, after which it will become self-financing.
The foundation would also look for investment of up to £10 billion from the city and other private investors to back successful early intervention schemes, by investing in social impact bonds which would give a return over time. This is likely to be based on a payment-by-results model.
The foundation will provide advice to charities, local authorities and others on running and funding early intervention programmes, and build up the evidence on early intervention schemes that work.
The plan is part of Iain Duncan Smith’s Social Justice Strategy published today.
Mr Duncan Smith (pictured) calls for a move towards tackling the causes of social breakdown through early intervention, rather than spending Government money on dealing with the consequences.
A group of more than 30 charities and other organisations set up by MP Graham Allen is understood to be the lead contender to run the Early Intervention Foundation.
Mr Allen is the author of two reports into early intervention published last year, which called for the setting up of an independent foundation to lead work on early intervention.
The consortium has already started work on putting together a bid with PWC, with a team that includes the chief executive of 4Children Anne Longfield, Dame Clare Tickell, chief executive of Action for Children, Jean Gross, former children’s communication champion, Christine Davies, chief executive of C4EO, and Elly De Decker, investment director of Impetus Trust.
Mr Allen said, ‘Building an independent EIF is the most important of the 60 recommendations from my two reports for the Government last year on early intervention since it will give life to the other 59.
‘The fact that the funds have been contributed from the departments of health, local government, education and work and pensions and with the approval of Treasury and Cabinet Office indicate the cross Government awareness of the need for a culture change from expensive and often ineffective late intervention to much cheaper and effective early intervention.
He added that the announcement was 'a significant step forward for the whole family of early interveners'.
Anne Longfield, chief executive of 4Children, said, ‘The current approach of dealing with the consequences of families in crisis after they have reached breaking point is simply unsustainable – and hugely expensive. Government has just five years to radically overhaul the system to focus on prevention, otherwise, the money will run out.
‘This should also mean making social investment a reality. The whole of society has a responsibility to prevent family crisis and if the city could get as passionate about social investment as it is about bonuses, it would make a real difference.’
‘4Children welcomes the establishment of the Early Intervention Foundation – it will bring together valuable and useful resources that will help local authorities identify where problems arise and provide effective solutions and examples of best practice to tackle locally indentified needs.’