End Youth Homelessness commissioned Pro Bono Economics to estimate the potential value for money of their new Health Fund.

End Youth Homelessness is a UK-wide movement of leading regional charities that house and support homeless young people (aged 16-24) at risk of, or experiencing, homelessness. In 2021, End Youth Homelessness is launching a Health Fund which will, amongst other things, fund near-immediate access to specialist mental health support assistance for young people who are homeless or at risk of homelessness.

We draw on existing evidence to estimate the monetary value of the potential benefits for individuals expected to benefit from this new funding through three key channels:

  • Reduced use of NHS mental health services
  • Reduced costs for public services for those in education
  • Increased productivity for those entering or already in the labour market

We assess the potential value for money of the Health Fund by comparing these estimated benefits to the anticipated costs of the programme.

Our analysis suggests that:

  • On average the Health Fund could generate more than £800 of benefit for each young person supported.
  • More than 60% of these benefits - around £500 per person - come from increasing the chances of young people finding employment in more productive roles over their working life.
  • Just over a fifth of this benefit – around £180 per person – is likely to come from reduced demand on NHS mental health services.
  • The remaining benefit – around £150 per young person - is likely to come from reduced costs to additional support in education and social care services for those still in education.
  • If the Health Fund is able to support its target of 1,104 young people per year then it’s possible that it could generate more than £900,000 in economic benefits at a cost of £570,000, delivering a net economic benefit to society of in excess of £330,000 for each year of support.
  • These results imply that for every £1 spent by End Youth Homelessness through the Health Fund could generate a potential societal benefit of £1.60.

Our analysis provides evidence that the benefits to society from improving the mental health of young people experiencing, or at risk of, homelessness by providing mental health services faster and over more sessions are likely to out-weigh the costs. Whilst some of the benefits fall directly to the young people supported in the form of increased wages, we have identified that the wider public is also likely to benefit from reduced pressure on the NHS, school system and increased taxation revenue to support public services. This suggests that not only is there a moral and ethical imperative to supporting young people facing some of the most challenging circumstances, but an economic case too.

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26 April 2021