News Insight: Early intervention must show investors value for money

Graham Allen, the Labour MP for Nottingham North who was announced as chair of the coalition government's review into early intervention a fortnight ago, admits he has a tough task ahead.

Among his priorities is an ambitious attempt to overhaul funding for early intervention projects, which offer intensive social care and health support to the UK's most disadvantaged children and families. "It's going to be tough but the days of government putting up millions of pounds to fund this type of work are gone, we need to have something different," he tells CYP Now.

Allen's review is the first major project of the Cabinet's social justice committee, chaired by Work and Pensions Secretary Iain Duncan Smith, who co-wrote a report with Allen in support of early intervention for his think tank the Centre for Social Justice in 2008.

Social impact bonds, which involve the private sector investing in early intervention to eventually earn a profit through long-term savings in areas such as health improvement and benefit reduction, are among the options Allen will examine. "I'm realistic. The (business sector) don't really care about kids in areas like Nottingham but they do care about getting a good return on investment, which is what I hope to offer them."

Funding models

Nottingham City Council labels itself "an early intervention city", with a range of projects to improve outcomes of young people such as "DrugAware". It is already exploring different funding models, including social impact bonds. But the council's director of children's services, Ian Curryer, believes Allen may face an uphill battle in persuading firms to invest.

"We have talked about this with the private sector. But with the current economic situation there is not a lot of interest," he says. "That is why it is important to get as much evidence as possible to ensure they see the value of early intervention."

Nottingham is also looking at ways public money can be used more efficiently in early intervention projects, including joint commissioning and, in particular, pooling budgets for children's social care and health.

Identifying key characteristics of successful early intervention projects will be central to Allen's review. For Curryer, clear targets and evaluation are essential.

For example, Family Nurse Partnerships, the intensive intervention programmes that target first-time young mothers currently being piloted in Nottingham, have goals that can be measured, such as improvements in children's health. But a similar youth justice project in the city, which takes Year 5 pupils to a criminal justice museum, does not produce such tangible results.

Action for Children, which runs early intervention projects nationally, is exploring how its work can be evaluated. One of its children's centres in Doncaster is trialling a report card, where quantifiable indicators of success are collected - such as improvements in a child's appearance.

Helen Donohoe, Action for Children's director of public policy, says successful projects often use a "hub", like a children's centre, which can target those who need help.

Denise Lane, project manager at Action for Children's Balby Children's Centre in Doncaster, says: "We had a woman in tears who came to the centre 18 months ago - her boyfriend wanted her out, she was depressed and pregnant. This put her unborn baby at risk of health problems."

The Action for Children team helped her get new housing, arrange benefits and attend sessions on nutrition. Lane says the mother and child are now healthy and the mother is training to be a peer support worker.

The previous Labour government's March 2010 report Early Intervention: Securing good outcomes for all children and young people proposed ring-fenced government funding for early intervention and also considered social impact bonds. The former Department for Children, Schools and Families took the lead on this project.

National Children's Bureau chief executive Sir Paul Ennals says the governance of the review should not be the greatest concern. "What is most important is it is being backed by representatives across all three parties," he says. "This is more important because the benefits of early intervention work across generations. The party in power will change so they all need to be behind this."

Previous major reports on early intervention

• In 2008, Labour MP for Nottingham North Graham Allen joined forces with former leader of the Conservative Party Iain Duncan Smith to pen a report on early intervention entitled Early Intervention: Good Parents, Great Kids, Better Citizens. The report called on all parties to support a policy of intervention, which they hailed as a "cheaper and more sensible (way) to tackle problems before they begin"
• Charity Action for Children and think tank New Economics Foundation produced a report in 2009 extolling the financial benefits of preventative services. The Backing the Future report set out a detailed analysis of the cost of failing to invest in services that prevent crime, mental illness, family breakdown, drug use and obesity. The report also suggested that encouraging investors to put their money into government bonds would be a way of financing such initiatives. Under the scheme researchers predicted the UK will save £486bn over 20 years
• In March, Labour published its report Early Intervention: Securing Good Outcomes for all Children and Young People. Within this, Labour committed to forming an expert group to explore the potential of using social impact bonds to raise money. It also provided guidance for children's trusts on how best to deliver early intervention and boost provision

Goals for the next report

The independent review into early intervention chaired by Graham Allen falls under the remit of the new social justice cabinet committee, which is chaired by Iain Duncan Smith. Children's minister Sarah Teather will be updated on its progress on a monthly basis.

The review will report by the end of January 2011 on the issue of best practice and provide an interim report on funding. A final report on funding will be produced in May.