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My name is Bond, ‘Bond for hope’

November 16, 2011 by
Filed under: Credit crunch, Public policy, The RSA 

The unemployment statistics, and particularly the figures for young people, are truly dreadful. The evidence that people who are out of work for an extended period in their younger years are more likely to be vulnerable to unemployment throughout the rest of their life makes an important point: While the Government may say its strategy is putting long term stability ahead of short term demands, the social impact of today’s slump will itself be long term.

I will leave others to comment on the Coalitions’ line that the UK’s current problems can be laid at the door of the Eurozone crisis. It is worth noting that both economic growth and unemployment are worse in the UK than many Eurozone countries.   

The point is that something has to be done. Here is my suggestion. I’m sure it is full of holes but maybe they can be filled by people cleverer than me.

The Government should create a ‘bond for hope’. This would be a five year bond earning say 1% tax free interest (so, below inflation but above what banks are offering). To reduce the worry that this is more Government debt liability, investors would have to carry the risk of Government taking up an option to roll the bond redemption date on by a further five years.

The bond would aim to make £2 billion pounds available immediately to fund roughly a quarter of a million one year jobs for young people costing £150 a week (say £125 weekly allowance and £25 employer admin fee). The bond fund would be financed equally by a direct grant from Government, by 100 companies with the largest current capital reserves, who would be asked publicly to sign up or explain why not (after all, it would cost them less than £7 million each), and a public subscription made up of 660,000 individual investments of £1,000. The public bond would be targeted at particular groups, for example well off pensioners. Those who bought the bond would receive a certificate and other forms of public recognition. The bond would be overseen by an independent body of senior respected figures who would be charged with championing it among corporates and the public.

Crucially the jobs created by the bond would be in areas where young people could make a clear contribution to improving society. I have three initial ideas:

Primary schools – in my experience many teenagers are very good with young children. If every primary school in England took on two young people to help out in a range of functions from reading with children in class, to manual work, to offering additional activities such as drama or football coaching this would create 40,000 jobs and bring real benefits to the schools 

Old people’s homes and other facilities – this sector is in crisis. Local authority funding for homes has fallen by an average of 4% in the last two years and recent report from the Care Commission found terrible examples of negligence in hospital settings. Again many young people are very good with older folks and there is a range of activities which they could undertake to improve the quality of life of frail older people, most of all simply offering more companionship.

Public space – from increasing the frequency of street cleaning, to tidying up and maintaining parks to helping reclaim derelict spaces, every local authority, neighbourhood council or community association could take on a group of young people. Their tasks and goals would be published on line so the public could help monitor, encourage and support them in making places cleaner and nicer

Running alongside these jobs the Government would create an on-line learning resource so that every young person could pursue a qualification related to their activities, with a part of their accreditation being work based. The public could also be asked to offer mentoring support to students. Employers would be encouraged to earmark entry level jobs and apprenticeships for people who had successfully completed a ‘bond for hope’ placement. And, of course, young people would be expected to take up any reasonable offer.

The ‘bond for hope’ would give young people a job and a basic income, it would improve the opportunities of young children in school, the quality of life of older frail people and the quality of public spaces. Most important of all it would give those of us who have some money a chance to help and be seen to help together. We tend to assume that it is hope that leads to action. In my experience it is the reverse; action leads to hope. So let’s act.

This may seem like a simplistic idea; perhaps there is a killer argument to show it is impractical. But if it – or something like it – happens, I hereby pledge to be one of the first ‘bond for hope’ investors.



  • Leon Cych

    I’d totally agree about Primary Schools as that is one of the reasons Social Media for Schools has been set up; to encourage multi-partnership models in both primary and secondary schools. To build networks of expertise that would facilitate this as a model and to connect that expertise.

    Building on a blog I wrote following the learning without frontiers conference last year:

    we established Social Media for Schools (which is entirely bootstrapped by us but seeking funding as a totally non-profit CIC).

    There are many schools out there starting to move towards this area such as Westfields school who employ a full time radio apprentice in their school to run the radio station:

    But all these heads are crying out for funding. There are good precedents for community learning but the infrastructure is just not there to provide adequate models for senior managers and where it is, it is ad hoc and bereft of money for these purposes – possibly because it doesn’t fit within the narrow metric of A*-C but is emergent and I would argue more authentic learning. When I interviewed the local radio station involved in helping to put that radio station in place in the school I discovered there was a whole raft of training opportunities that the company was involved in but people aren’t connecting up the dots. The headteacher had to be brave enough to devote a whole swathe of the budget to installing and maintaining such a system and they have got the gold medal for the best school for parental engagement from the Schools’ Network. Needless to say the scheme is really effective in raising any kind of standard you’d like to mention but there had to be financial risks on the part of senior management.

    Again, look at the pollen EU Project and its model for community learning:

    These multi- partnership models have been show to work very well but it is question of creating that network and building the infrastructure with more than just good intentions.

    I’d also push for the a route to becoming an entrepreneur, based on any products and services coming out of such a scheme. So a little seed funding there for individuals, mentoring and expertise wouldn’t come amiss either.

    The recent Mozilla festival where a whole handbook on data journalism was produced in 48 hours also points the way to rapid prototyping, mentoring and “hacking” the educational system. Their hive network for creating digital content and web native applications around social concern has a good system of funding from the MacCarthur and Mozilla foundation for younger people. Why doesn’t this exist here?

    We need an equivalent over here – although I doubt there is as much philanthropy so a certain amount of arm twisting such as the Robin Hood tax ( or the scheme you propose wouldn’t come amiss. Where is the vision and the will – it’s certainly there at school level or could be mainstreamed.

    I’d like to think there is enough vision to get the community to connect back to learning in this way and for (not just younger) people to have their future underpinned by truly localised support.

  • Nigel Rayment

    Your proposed Hope Bond – with its contribution from the top 100 companies – seems more just than the CBI’s suggestions that:

    1. the national minimum wage for young people should be frozen
    2. public funding should be handed over to the private sector in the form of National Insurance holidays

  • Ian Christie

    Sign me up. A great set of ideas, and they point towards what we desperately need, namely a system of welfare-with-livelihood, a much more flexible and humane model of transition in and out of paid work than we have now, with a damaging split between being on benefits and being in a job.

  • Tom Brookes

    Great stuff Matthew! Sometimes the simplest ideas are the best ones.

    The government’s ideas? I’ve read cut benefits, it’s the eurozone, the good ship Britain’s at economic stormy seas, don’t worry – we’ll entrepreneur our way out of this! Oh & the hell with EMA & all those surestart programmes I understand were doing so much good. it’ll be all better when the deficit’s gone & there’s nothing to show for it…

    Except 17 year unemployment highs, equally high average personal debt – if not more, if inflation carries on – & a privatised country called ‘Big Society Land’.

    Of course, there’s always the government’s plan – work for free or loose your benefits. A group of lawyers are challenging it as an effort at slavery:
    I honestly don’t think it takes 30 hours a week to get experienced at stacking shelves. What an impossibly foolhardy venture. Better the 1930’s scheme of one team digging holes & the other filling them in – at least they got paid, & it could turn into a massive pothole fixing initiative!

    Not very uplifting thoughts this time, but the employment news & today’s casting of the economic tea leaves has put me in a deeply cynical mood, so I’m spitting sarcastic bile at your nice uplifting post – sorry about that! :)


  • Mike Kinghan

    Totally agree with the principles behind this though I do wonder if 1% interest is sufficient when you can get 4.4% taxfree on a five year ISA. WItrh inflation at 5% perhaps a little more than 1% might be needed to attract this level of investment. I’d invest at either 1 but with 2% I’d do more.

  • Jeremy Richardson

    Like this idea. I had a similar notion that perhaps school leavers could enter a period of National Service. By which I mean National Community Service/National Education Service/National Industrial Service or, indeed, in the Armed Forces. I don’t know how this was funded in war time but we are essentially on a war footing here (or we ought to be) so I think it merits consideration.

    I raised this point on an Independent forum yesterday and someone questioned what transferable skills it would offer. I’d say many but more to the point it would be completely alter the mindset. It would be about contribution and one’s value as an individual in society. I do think this whole issue is about underlying attitudinal change as much as changes in the market.

  • Tim DeVille

    Great idea – best yet I’ve seen. The problem of work for youngsters is huge and will get worse if nothing done – get retired people to administer the fund for no costs and will show that the older generation is doing something for the younger

  • Rachel Bingham

    Just a small question….how are you proposing to repay the capital and interest on the bond if you’ve spent it all in the first year?

  • Bruce Davis

    I should declare an interest as one of the founders of Zopa and a now a director of a new FSA authorised venture, Abundance Generation, which will allow ordinary people (i.e those with a min of £5 to invest) to earn a cash from investing directly in the production of renewable energy.

    We call it ‘Democratic Finance’ – giving people greater control over how their money is invested and weaning off our reliance on the City and Banks as custodians of our investment decisions. While we definitely applaud the idea that putting our money into action can help generate much needed confidence and hope for the future, we would question the need for it to be ‘managed’ by the great and the good (or the need for that matter of any government money or corporate intervention).

    Zopa has successfully taken 2% of the UK personal loans market generating stable returns for its lenders throughout the financial crisis, and winning ‘most trusted lender award’ 2 years running from its satisfied borrowers.

    Abundance investors will be putting their money into building the much needed “green economy” – an infrastructure which aids UK energy independence and combats the volatility of our growing reliance on imported supplies of natural gas – as well as producing jobs, taxes and wealth which stays in the UK.

    Where we would also challenge this idea is that doing social good necessitates a low rate of return. The danger is that this compounds the idea that growth in our economy requires the patronage of those who can afford to give to help those who can’t help themselves. If you want to make a charitable donation, then do it through a mechanism that provides additional tax boost of gift aid, if you want to make an investment in the future of the UK – then it must be possible to engineer a return that marries individual interest with collective ethics.

    For too long the City have been selling the myth that they are only ones who can organise sufficient finance to deliver significant public investments (and carry the risks involved). Democratic Finance will hope to debunk the idea that PFI, son of PFI were just a costly cul de sac in our financial history and that in the future it will be public money that finances the public good and benefits from that investment return.

  • Simon Edwards

    I believe that there is the basis of a very good idea here and I would like to pick up on the comment about a national community service. As an ex-serviceman who has been setting up mentoring programmes for those leaving the services as a result of redundancies and injuries, I am struck by the huge resource we have in UK in those who have served their nation. Many of the skills, that we have already invested in, are transferable into peaceful and social purpose. Moreover I am humbled by the fact that many of these young men want to continue to put something back – help from heroes

    I am proposing that we create a national service providing exceptional young leaders from those leaving the Armed Services, working with young leaders, as part of their personal development, from the corporate world (who would contribute to the funding), to act as mentors and role models to inspire, empower and guide young people to develop the confidence, skills, attitudes and behaviours to take responsibility for their futures so as to realise their full potential and maximise their chances of finding rewarding employment. This will link young people to the opportunities to find themselves through service to others here and abroad, thereby changing their lives and the lives of others. To create hope for the hopeless

    Maybe this could be one way of utilising the bond of hope

  • Matthew Taylor

    Some facinating and useful comments here. Thanks to you all. I return to this issue in my blog today.

  • http://www.1986 Small John

    I will speak my mind.

    Thatcher 1986: Big bang in this country, great.

    However, this did create meriticracy which is now biting back.

    There are too many youngsters, whom I know very well, with fancy degrees who are unable to get work.
    It works 2 fold, but ultimately the U.K opened the doors for employment, it waved goodbye to the old adage”its all about who you know” and paved the way for merit. And so good it was, the U.K has the best people from all over the world coming to work here. Fantastic, therefore we retain, hopefully, an exceedingly talented workforce.
    However, this leaves us with the question does meritcracy eliminate our own.
    Too many Unis accpeting International students etc who all want to live in the U.K This is great but, realistically, our own unemployed youth take the burden.

    Contrary to popular belief I’m not BNP or a marxist but a’ realist.’
    Would we be better doing it ourselves?

  • MAS

    (re. comment above – meritocracy?! Really?!)

    1. It seems a bit at odds with slimming down the public sector to have so many suddenly doing a form of apprenticeship in them.
    2. Maybe universities will have some spare capacity to take on young people instead?….(and at those rates…)

    It comes across slightly as occupying the masses rather than investing in young peoples future (I appreciate that’s not how it’s meant). Likewise the suggestions about citizen services etc. etc. Not that I’m against that line of thinking – my personal belief is we should stop involving ourselves in warfare, save for defense, and instead use our armed forces as the heart winning humanitarian forces they sometimes claim to be, only to do it full time and that would certainly provide all manner of transferable skills.

    How I think young people could make a difference to society is in helping to build small, local businesses. I mean really small – small enough that good service is critical, where the customer meets the owner. Small enough that the owner has to innovate, not contract everything out.

    I’m not anti Tesco et. al but I do think a part of the problem with a lack of responsibility is related to the ‘don’t give a crap’ attitude stemming from not caring about the things people do, and I’m not sure that picking litter in the park will help improve that.

    Even at the Catalyst workshop yesterday the dominant talk was of ‘scale’ – to the point that one of the funders claimed to have no interest in anything that couldn’t scale within 18 months!

    What about helping young people create new services, businesses, based on local need? There could be incentives/encouragement for them to work towards the ‘public good’ but critically they would be doing things of their own creation, things that THEY would be responsible for, and ultimately able to take credit for helping shape society rather than dancing to the tunes of those who’ve made a mess of it.

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