Social Impact Bonds

In my last post, I suggested that resources would be needed to support community action and that thought needed to be given to innovative ways of doing this. Social Impact Bonds are an interesting idea here. They are a means of raising investment finance for a new initiative, which could be promoted by community groups. Investors get a return from the government as the initiative produces certain desired outcomes. The idea is that these outcomes in some way save the government money and so they can use the money save to pay for the return on the initial investment (which may be from the public or private sectors). The Social Outcomes Fund currently contains £20 million for this purpose. So how might this work in a way that delivers just sustainability on the ground? First a community initiative that  benefits a lower income or otherwise disadvantaged group of households and contributes to social and environmental sustainability needs to be identified. Then a clear argument needs to be made about the costs that will not be incurred in the future by public services because of these benefits. Hopefully the future financial savings will then be sufficient to provide the desired return on the initial investment in the initiative. Food gardens promoting better nutrition and physical activity, childcare facilities providing 'green play', training activities in environmental services, community-based flood prevention landscaping would all seem potentially to be possible areas for SIBs. Whether they would fall foul of current 'rules and regulations' remains to be seen. At present the commissioning process looks quite onerous and would require support. But in principle this could be a way of resourcing community action that contributes to sustainability and benefits key social groups because - at the same time - it avoids future government bills.