Cabinet Office publishes template contract for social impact bonds

The Cabinet Office has published a template legal contract as part of its drive to support the development of social impact bonds (SIBs).

The Centre for Social Impact Bonds, which is based in the Cabinet Office, has also created a ‘Knowledge Box’ – an online portal providing information on developing and commissioning SIBs.

It covers issues such as the identification of areas suitable for SIBs, the measurement of outcomes and the calculation of savings. There are also case studies and answers to technical questions that early developers of SIBs have encountered.

The template service agreement contract – governing the terms of the relationship between the commissioner of a SIB and the delivery body – has been designed to help reduce the time and cost associated with developing the legal arrangements of a SIB.

The Centre said: “It is a relevant tool for developing any payment-by-results or outcomes-based service contract, but it has been developed based on specialist expertise on outcomes-based commissioning projects that draw in social investment through a social impact bond.

“The contract template is based on the law of England and Wales. It was developed through a wide consultation with experienced SIB developers including commissioners, investors and intermediaries involved in the 13 SIBs currently in operation.”

The Centre stressed that the template was intended as an enabling tool. “It is not, however, an off-the-shelf contract and commissioners and other developers should seek their own legal advice in developing their legal arrangements.”

A guidance document on contracting social impact bonds is also available here.  

See also:

Setting up social impact bonds by Richard Curl of Essex County Council

The name is Bond, Social Impact Bond – SIBs and social housing by Jon Coane of Bevan Brittan