Funding package helps The Skill Mill expand employment programme for young offenders.
A pioneering initiative that helps young people break the cycle of re-offending has moved into Birmingham after it received a £1 million investment package.
The Skill Mill, which delivers an intensive six-month work programme designed to get individuals back into employment and away from crime, has been commissioned by seven local authorities across England, including Birmingham City Council.
This means that 32 young offenders will now benefit from mentoring, support and a guaranteed job on environmental maintenance and construction projects over the next three years.
National expansion has only been possible thanks to The Life Chances Fund and four social investors jointly led by Northstar Ventures and Big Issue Invest, plus backing from CAF Venturesome and the Resonance West Midlands’ SITR Fund.
The latter means The Skill Mill will become the first organisation in the North East to access Social Investment Tax Relief, which offers social enterprises and community groups the opportunity to access repayable finance at a lower rate of interest and on more patient terms, whilst giving investors up to 30% back in tax relief.
“This is a massive boost for the vital work we have been undertaking in Newcastle since 2014 and will now let us take our initiative to seven new areas, helping rehabilitate 224 more young people,” explained Davie Parks, founder of The Skill Mill.
“We will engage with individuals in Birmingham that are highly vulnerable and in a vicious cycle of re-offending. Our aim is to break that chain by giving them a job for six months and, during that time, they will receive accredited training, mentoring and support to hopefully secure them long-term employment at the end of it.”
He continued: “To date, we have had just fifteen reconvictions out of the 158 people we have helped so far, that equates to a 9.5% rate compared to the Ministry of Justice national average of 72% for young people who have been convicted of eleven or more previous offences.
“The average cost to the whole system of a young offender per year, including police, prison, court and the Youth Offending Service, is estimated to be £112,000, so in our six years The Skill Mill has helped save the taxpayer more than £16 million.
“Then you have the social impact of young adults in jobs and positively impacting on society.”
The latest roll-out will see teams of four created and they will work together for six months on a range of environmental maintenance, conservation and construction contracts.
Corporate partners Balfour Beatty, Commercial Estates Group, The Environmental Agency and United Utilities have already pledged their support and The Skill Mill is now appealing for other businesses to come forward.
Each group will be supervised by a team leader, who has been seconded from the Youth Offending Service for the duration of the contract.
The jobs are based on rigorous evidence gained over the past six years and designed to integrate young people back into the labour market and society, whilst also helping them to improve emotional and physical wellbeing through being outdoors and with significant contact with nature.
Davie went on to add: “Our track record for making a difference certainly helped in our ability to attract funding for our growth, with Social Finance sponsoring the programme.
“I was especially pleased with the £100,000 we received from the Resonance West Midlands’ SITR fund. It was the final piece of the jigsaw and gave other investors confidence that the project and outcomes were more than viable.
“The fact that this slice of money can be accessed at low rates of interest and there is no requirement to pay capital back in the first three years means we can focus all of our energy into developing the national programme and making sure it works for young people. I’m also delighted The Skill Mill has become the first North East social enterprise to benefit from the scheme.”
Grace England, Investment Manager at Resonance West Midlands, added her support: “This is a great example of how SITR can be used as part of a blended funding package for social enterprises looking to grow and deliver essential services that make a real difference.
“With Covid-19 putting additional pressure on the financial capabilities of organisations, there has been a strong surge in demand for Social Investment Tax Relief, giving further evidence that the Government should look or extend and enhance the offer going forward.”
Social Investment Tax Relief has leveraged over £14 million in private investment to help 88 social enterprises deliver essential services across the UK. It is the only tax break specifically aimed at social enterprises and is designed to encourage individuals to support the sector by helping them access new sources of repayable finance, with backers receiving a 30% tax break when investing into an eligible organisation.
However, enterprises and social investors are now urging the Government and Treasury Minister Jesse Norman to not backtrack on their promise to ‘level up’ the UK’s cities and regions by scrapping SITR, which has a proven record of unlocking and directing private capital into some of the most disadvantaged places in the country.
They are now encouraging MPs to get behind their bid to not scrap SITR in April 2021 or, if they are looking to tidy up the tax system as Danny Kruger alluded to in a recent report for Boris Johnson, it is vitally important they delay SITR’s abolition until a suitable alternative can be found to grow the social investment market.