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Funds and pension funds to invest in welfare

The Danish government intends to accomplish more welfare tasks in the future by means of investments from funds and pension funds.

As part of the Danish government's reform of the public sector, it wants funds and pension funds to invest in core welfare, Danish news daily Berlingske reports.

In Herning municipality, local authorities are trying to form a partnership with a number of private investors that are to put a three-digit million sum in DKK into a youth education project. If a number of prearranged benchmarks are reached, the investors will profit from the investment, while they will lose money if the project fails.

Danish Minister of Public Sector Innovation, Sophie Løhde, sees big potential in in the model.

"It's an entirely new way of collaborating between the public sector, the private sector, and also the voluntary sector, that we haven't seen in Denmark previously. This way, we want to develop better performance that creates better returns, primarily for the individual, but also for public funds. Take the social sector, for example, where we spend billions every year, but we don't necessarily have evidence of what is effective," she says to Berlingske.

English Edit: Marie Honoré

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