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NSW Treasury publishes KPMG evaluation of Australia’s first Social Benefit Bond 

New South Wales (NSW) Treasury engaged KPMG in Australia to evaluate the planning and development phase of Australia’s first Social Benefit Bond, a new payment for outcomes approach emerging in the human and social services. Social benefit bonds (also known as social impact bonds) restructure the relationships – and the risks and rewards – in the funding, design, delivery, and financing of human and social services.
NSW Treasury

In the approach there are three central parties: government, not-for-profit service providers and financiers. Government contracts for services with social outcomes, which if successful, will generate savings to government. Private investors provide up-front funding to service providers to deliver improved social outcomes and the rate of return to investors is dependent on program outcomes. Social benefit bonds are concerned with better outcomes and more effective service models.


The first social impact bond was implemented in the UK and now bonds are being developed in the US, Australia and New Zealand. KPMG in Australia has released an evaluation of the planning and development phase of Australia’s first Social Benefit Bond which was prepared for New South Wales (NSW) Treasury. The report examines the development of Australia’s first two social benefit bonds which are in the area of early intervention in child welfare; providing intensive support to families and children to avoid placement in foster care or providing support to families so their child can return home from foster care.


Read the evaluation report.


The report documents the development of the social benefit bonds in NSW, outlines what has been achieved, considers what can be learned and proposes future directions for social benefit bonds in Australia.


The evaluation studied the development of the bonds through stakeholder interviews, document review and through a survey of investors. The evaluation found that:


  • Social benefit bonds are viable in New South Wales – Two bonds have been successfully developed, and it is recommended that other payment by results contracting schemes are also explored.
  • The development of the bonds has produced positive outcomes – for both the not-for-profit sector and government, including an increased attention and understanding of program outcomes and measurement.
  • If future bonds are to be developed, capacity building is vital – Capacity needs to be developed within government, in the not-for-profit sector and in financial intermediaries, to develop future bonds, improve data and contracting capacity, and develop and catalyze the social impact market.
  • It is expected that future transaction costs of bonds will decrease – Although the development of the bonds was labor intensive it is expected that transaction costs will decrease as capacity is built and the field matures.

For further information contact:


Liz Forsyth

Sector Lead: Health, Ageing and Human Services

Partner, Government Advisory Services

KPMG Australia

Ruth Lawrence

Associate Director

Health and Human Services Advisory

KPMG Australia

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Paul Hencoski

Paul Hencoski

Global Chair, Human & Social Services

+1 212 872 3131

David Hansell

David Hansell

Global Head, Human & Social Services Center of Excellence

+1 212 954 2867