Cabinet secretary Sir Jeremy Heywood has proposed a kitemark to vouch for the effectiveness of social policy schemes.

The proposal centres on the formation of an independent arbiter that could encourage third party investors to back proven social enterprise schemes such as rehabilitating prisoners or drug addicts. Potential private investors would be advised of quality thresholds which would enable them to back effective schemes.

The introduction of such standards would also lead to social enterprise schemes improving efficiency as they sought out private funding. This new organisation would be the social policy equivalent of drugs advisory board Nice.

The scheme was devised by Heywood alongside Sir Bob Kerslake, head of the civil service. The pair are looking at various ways of combining the needs of the public sector with private sector money.

Social Enterprise UK chief executive Peter Holbrook welcomed the concept: “Potential investors need to be able to easily identify organisations that have developed a successful model and are investment-ready.”

A timescale for the new body’s introduction is still to be put into place. A spokesman for the Cabinet Office said the scheme was still at an “embryonic stage”.