Social Impact Bonds 2.0?
Today PERU is publishing a briefing paper that draws together ideas about the next generation of Social Impact Bonds (SIBs) that will be better placed to deliver more innovative approaches and act as positive disruptors in local public services. It is based on research in four SIBs managed by Bridges Outcomes Partnerships (Bridges) and ideas developed by researchers at the Policy Evaluation and Research Unit at Manchester Metropolitan University and the Sol Price Center for Social Innovation at the University of Southern California.
Theory suggests that for SIBs to realise their full potential as incubators of innovation they need to incorporate mechanisms that allow people with lived experience to work with other stakeholders to co-create services that meet people’s needs and that draw on the strengths and assets of people who use services. This model of working provides strong foundations for challenging established ways of working in public services and changing local systems. SIBs that unlocked these possibilities could play a more significant role in public sector transformation.This study of four SIBs provides some evidence of how adopting a strengths-based approach can support and is intertwined with delivering social innovation.This study shows how the structure of the SIB can facilitate a move to strengths-based working. Key elements of the SIB structure included:
- involving a wide range of local partners in the design of the SIB, rather than appointing a service provider once the SIB contractual framework was complete;
- moving away from using standardised delivery models towards service delivery models that emphasised individualised or personalised services;
- adopting a rate card that allowed for multiple outcomes at the level of the individual so encouraging service providers to closely monitor individual progress and adjust individual service offers if one approach didn’t work; and
- flexibility around levels of investment in the SIB to allow for new service offers to be developed as new needs were identified.
Overall, our findings suggest that for SIBs 2.0 to facilitate greater co-creation and social innovation through strengths-based approaches, they need to allow for higher degrees of flexibility in funding and service personalization, establish strategies to support systemic change past the terms of the contract, and engage service users earlier in the design process.
A full report on the research that underpins the briefing is available here.