The social justice strategy presented by work and pensions minister Iain Duncan Smith is set to make joined up government a reality after two decades of false starts.

The strategy unveiled by Mr Duncan Smith presents a vision of an organisational boundary free approach to supporting the hundreds of thousands of people living troubled lives. The strategy focuses on the people and families and then works back to ways in which they can be given a second chance. The solutions envisaged disregard existing organisational silos.

The strategy recognises that the causes of disadvantage span across different areas such as housing, education and health. It highlights that the fragmented approach results in people falling through the cracks between services. It is only be focusing on the individual or family that all the cause can be identified and dealt with.

The work done in Total Place in 2009 and more recently in Community Budgets has been following this approach at the local level. The strategy provides the ministerial framework for joined up working which was previously lacking and which will now ensure that foot dragging by Whitehall departments will be less likely. The Social Justice Cabinet Committee brings together Ministers from across Government to drive the agenda forward.

The initiative being pursued by Communities and Local Government to change the lives of 120,000 troubled families will provide learning for taking the strategy forward on a large scale.

The strategy also takes up a key finding from the Total Place pilots that early intervention is not only beneficial for people and families, but is also much more cost effective. The strategy proposes a switch in spending towards early intervention, and to enlist private investors in providing funding. Currently some £25bn a year is spent on the consequences of social breakdown and a pittance on its underlying causes.

The Department for Education intends to form an Early Intervention Foundation, and to persuade the City and local authorities to invest up to £10bn to prevent social breakdown in a public-private partnership.

The intention is that investors would make money by backing projects or agencies that steer vulnerable people away from crime, drugs, unemployment truancy or family breakdown, so saving state spending on social failure.

A “payment by results” model is likely to be used. The organisation would try to unlock a new social investment market by listing successful early intervention schemes and by setting out indicative rates of return.

The Foundation is to publicise intervention schemes that work, and tell investors how much money they might make over a fixed period. The strategy paper suggests the current social investment market of £200m could grow to £10bn.