Social bonds put profits before people

The Government is putting profit before people with its plans to use private investors to profit from social services which place people with mental illness into work, says the Public Service Association.

“Social bonds are just another way to contract out social services and distance the government from its responsibility to care and support those most vulnerable in society,” says Erin Polaczuk, PSA National Secretary.

“The idea of using an investment product for banks and others to make a profit from people with mental illness will appal many New Zealanders.”

“The Government is touting social bonds as a win-win for the taxpayer, saying it will only pay if targets are achieved. However there are serious weaknesses in such an approach. Social outcomes can be very difficult to measure and drawing up performance-based contracts and monitoring will increase the costs of providing services.”   

“There is a belief that the private sector is always more efficient and contracting out saves taxpayer dollars but you only have to look at fiascos like Novopay to see that how much of a myth that is.”

“Social bonds are unproven interventions. It is disappointing that the Government has chosen to launch this experiment with the lives of people with mental illness and their families.” said ErinPolaczuk.