King Annette: Oral Questions — Questions to MinistersText is incorporated into the Bound VolumeKing Annette: Oral Questions — Questions to Ministers[Sitting date: 01 July 2015. Volume:706;Page:4972. Text is incorporated into the Bound Volume.]1.Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health: How much has been spent by the Government on the Social Bonds Programme to date?Hon Dr JONATHAN COLEMAN (Minister of Health): That is a totally different matter.Hon Annette King: Well answer it.Hon Dr JONATHAN COLEMAN: I am about to. The Government’s programme on social bonds commenced in 2012 with policy development led by the Ministry of Health which produced a feasibility study and a business case for Cabinet in 2013 and the commercial procurement process which commenced in 2014. Commercial negotiations on the first social bond which will target better employment outcomes for those suffering mental illnesses are expected to be completed later this year. I am advised that the total cost to date is $1.35 million over 3 years which is approximately 0.0015 percent of the total social spend over that period.Hon Annette King: Is payment by result with cash for outcomes once the service has been delivered and measured still a key component of the social-impact bonds pilots?Hon Dr JONATHAN COLEMAN: Yes it is.Hon Annette King: If payment for results is still a key component and the first project does not start until the end of this year or the beginning of next year what are the Budget allocations from 2015 to 2017-18 amounting to around $29 million actually for?Hon Dr JONATHAN COLEMAN: As we have canvassed many times there are four potential pilots there the first of which is going to be this pilot around employment outcomes for people suffering from mental illness. We have been quite transparent. You can have a look at all the papers. We are so transparent about it that it is actually all up on the Ministry of Health’s website so go and have a read.Hon Annette King: I raise a point of order Mr Speaker. I asked what the money was actually being spent on if it was still a component.Mr SPEAKER: If the member is asking whether the question was addressed the question was addressed. The way forward is further supplementary questions.Hon Annette King: Does he recall being advised just a few weeks ago that for the social-impact bonds pilots it could be up to 7 years after service delivery commencement before outcomes are delivered and measured? Why does he need $29 million over the next 4 years?Hon Dr JONATHAN COLEMAN: We get a range of advice on this. In the end the delivery of the results and the timing of those will be tightly contracted for. So the member does not need to worry: we are not going to wait 7 years for results. We are going to pay once we get the results and they will be in much shorter order than that.Hon Annette King: Are ANZ and Westpac the two Australian banks that are looking to get their hands on the $29 million payout prepared to wait 7 years for their cash or has he backtracked on the payment for results and will he now be giving them expenses from the commencement of this service in total contradiction to the social bond project he and Bill English announced?Hon Dr JONATHAN COLEMAN: The first thing is that we have not named any financial institutions. It is subject to commercial confidentiality. The second thing is that the way the model works is that a bank will be a facilitator between an NGO and a source of finance to bring the whole deal together. In the end though we are not paying until we get results.Hon Annette King: Is he saying that the Government is prepared to spend $29 million over the next 4 years to procure for untried projects while at the same time 20 district health boards in Budget 2015 received the same amount—$29 million in funding for mental health—to provide services for the entire country?Hon Dr JONATHAN COLEMAN: No that is not what I am saying at all and the member knows it.Hon Annette King: If he is so confident in the process being used to set up for the social impact bonds why did a reputable organisation like the Red Cross withdraw from the process due to a lack of data availability about how it is going to work?Hon Dr JONATHAN COLEMAN: I do not have any information particularly about the Red Cross but there is a range of providers who are very interested in this. The programme will suit some and it will not suit others.Joanne Hayes: What support has the Minister seen for social bonds?Hon Dr JONATHAN COLEMAN: Social bonds have attracted widespread interest and support around the world with around 100 social bonds in development or under way. Political parties from the centre left have been particularly enthusiastic. That includes the UK Labour Party which announced the first social bond in 2010; the New South Wales Labor Party; and President Obama and the US Democrats. In fact I am aware of only one centre-left party in the world against innovation in the social sector and of course there are no prizes for guessing—it is the New Zealand Labour Party.Hon Annette King: I seek leave to table an update on progress and the next steps to the social sector reform leaders group headed “Social bonds pilot”—Mr SPEAKER: The source and date is? [Interruption] Order! If the member carries on like that I will not even put the leave. I need the source and the date.Hon Annette King: There is no date on it. I gave you the source Mr Speaker. It is a report to the social sector reform leaders group.Mr SPEAKER: Is it publicly available?Hon Annette King: No it is certainly not publicly available.Mr SPEAKER: I will put the leave and the House will decide. Leave is sought to table it. Is there any objection? There is no objection. It can be tabled.Document by leave laid on the Table of the House.Darroch Ball: Will he give his guarantee that the social bond programme once fully established within health cannot be rorted whereby results are manipulated just for profit; if not what measures will he put in place to prevent this from occurring?Hon Dr JONATHAN COLEMAN: The point is that through very tight contracting we are going to ensure that that cannot happen.