In the bonds of Govt we meet

The Government is setting up deals to encourage more private enterprise innovation into the mental health biz. And a busy biz it would be.

You’ll have your Government agencies (or maybe other social services purchasers like iwi groups or insurers) . . . which would deal with an intermediary organisation . . . which would raise working capital from investors . . . to fund the actual service providers . . . whose work would be scrutinised by independent assessors.

And if it all goes tickety-boo and produces agreed results, the Government will pay back the investors, plus a return.

That’s a lot of participants who would all need to be teamed up by elegantly wrought, exquisitely considered contracts.

The upshot, if we paraphrase Finance Minister Bill English and Health Minister Jonathan Coleman correctly, would be a system better able to encourage and reward innovation and actual results, as opposed to mere activity. And they’re potentially right. But by golly there’s nothing all that terribly implausible in Labour’s Annette King calling it a disaster in the making. Look out, she says, for a system in which, to meet targets, the private enterprise focus is likely to be on the easier-to-help clients, rather than the more problematic and pricey ones.

Much will swing on the Government showing what many would call a newfound ability to deal with private enterprise in a way which ultimately carries sufficient reward and protection for the public.

In these deals you don’t want the businesses to be making out like bandits, but neither do you want them going belly-up. Private enterprise would need plenty of capital to meet contract costs and last long enough to benefit from what might be slow-to-arrive financial rewards, so the Government needs to be very careful with whom it’s prepared to do business.

And what exactly would the bottom-line goals be? Empowering people with mental illness and supporting their families, the ministers say. And, oh yes, fewer people on benefits. Always a plus.

Cabinet has yet to determine details on just how the mental health social bond will be structured and which organisations will be involved.

What’s more it’s already picturing next social bonds category – either lowering reoffending rates or helping people manage long-term health conditions, they reckon.