Transcript Delivering Better Health Outcomes Through Social Impact Bonds

SOCIAL VALUE – A VIEW FROM SOCIAL FINANCE
APRIL 2012
Ben Jupp
[email protected]
SOCIAL FINANCE
2
Social Finance aligns government, investors and social organisations to address
key social issues.
• We are a team of finance and social sector specialists.
• Social Finance is a not-for-profit organisation regulated by the FSA.
INVESTORS
• Trusts & Foundations
• High Net Worth Individuals
• Private Banks
• Mass Affluent
• Institutional Investors
• Big Society Capital
GOVERNMENT
• Central government
• Local government
• Commissioners
• Ministries
• Policy Makers
Financial Structuring
Capital Raising
Research & Development
Key Social Issues
SOCIAL VALUE
©Social Finance 2012
SOCIAL ORGANISATIONS
• Children in Care
• Financial Inclusion
• Criminal Justice
• Employment
• Health Care
• Affordable Housing
• Excluded Youth
SOCIAL INVESTORS HAVE AN INTEREST IN UNDERSTANDING
SOCIAL VALUE
Social investors seek a combination of financial return and social impact
• Social investment in the UK has grown from £0 to c. £200m pa over the last decade
• The development of Big Society Capital should stimulate a more rapid development in the
years ahead
• Charitable Trusts and Foundations have been behind much social investment, but affluent
retail investors could also be an important source of funds
Sample of investors with over £100k investment assets
Source: NESTA/Fair Banking, Investing for the Good of Society
©Social Finance 2012
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WE SUPPORT THE IMPORTANCE OF ASSESSING BOTH FISCAL
AND SOCIAL IMPACTS
Example of Social Impact Bond to improve outcomes for young people in Manchester
Fiscal
Value…
Total Costs
Total Savings
Yr 0
321
-
Yr 1
684
481
Yr 2
1,142
1,145
Yr 3
1,130
1,934
Yr 4
1,133
2,420
Yr 5
1,133
2,420
Cost Requirement
Funded by:
Savings
Investor Drawdown
321
684
1,142
1,130
1,133
1,133
330
330
684
684
534
600
1,134
930
200
1,130
833
300
1,133
833
300
1,133
Savings Profile (including 6 mnth lag)
Yr 0
Total Savings
Allocated:
Recycled to fund costs
Investor Return (Inc cap)
MCC Return
Social
Value…
©Social Finance 2012
-
Yr 1
240
Yr 2
813
Yr 3
1,540
Yr 4
2,177
Yr 5
2,420
240
534
279
930
500
833
423
833
454
-
-
110
921
1,132
Yr 6
Yr 7
Yr 8
21
1,578
15
971
21
15
21
-
Total
39
5,620
10,949
39
5,620
39
3,206
2,414
5,620
-
15
-
-
21
15
Yr 6
1,999
Yr 7
1,275
39
Yr 8
Total
486
10,949
21
15
39
857
282
19
Total Outcome Payments
1,122
978
427
3,206
3,053
6,260
4,690
10,949
What does success look like for a looked after child?
A successful looked after child will experience the following:
Gender: Services will be culturally sensitive and recognise and value diversity.
Family’s: They will retain contact with their birth families and siblings where possible an
appropriate
Placements: They will live locally and have stability in there placement. Placement changes
should be kept to a minimum
Education: They will have the opportunity to enjoy a standard of education as good as that
which can be expected by the general population. They will have minimal disruption in their
school place.
Health……
WE HAVE FOUND THAT SOCIAL OUTCOMES NEED TO BE
TAILORED TO THE NEEDS OF THE POPULATION GROUP
• The Social Impact Bond in Manchester will deliver a new Multi-Dimensional
Treatment Foster Care programme
• The approach forms part of a wider commissioning strategy for Looked After
Children: to improve outcomes for children in Manchester and the quality of
provision and to achieve value for money
• An Evaluation Framework will be agreed with the appointed investors and
providers
• Examples of potential metrics:
– Number of weeks out of residential care
– Progress against the Young Person’s plan
– Attendance and attainment at school
– Health measures
– Foster carer’s satisfaction with the support they receive
©Social Finance 2012
WE HAVE FOUND VALUE IN MONETISING SOCIAL OUTCOMES
Analysis of BeActive physical activity programme
©Social Finance 2012
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BUT SOME WELLBEING METRICS ARE VERY HARD TO MONETISE
Analysis of BeActive physical activity programme
Average subjective wellbeing change
0.1
0.05
0
-0.05
-0.1
-0.15
-0.2
-0.25
-0.3
-0.35
-0.4
-0.45
Unemployment
Poor health
Proxy for active Be Active
membership (member of a club)
‘This represents a 6% improvement in subjective wellbeing above average life
satisfaction for relatively high frequency users’
©Social Finance 2012
WIDER REFLECTIONS ON THE PROPOSED SOCIAL VALUE
FRAMEWORK
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- Real strength in a combined framework for assessing economic, fiscal and social value:
of interest to public, politicians, commissioners, users and social investors
A full ‘balanced scorecard’ would also look at the impact on citizen and professional
capabilities and service user satisfaction
- Agree that social value toolkit best seen as a guide, alongside choices by elected
politicians, citizens and professionals, but still helpful for prompting better decision
making
The development of standard benchmarking in sectors, making available data which is
already collected, would support the comparative approach advocated in the report
- Trade offs between comprehensiveness and complexity: complexity can have costs in
terms of procurement, monitoring costs and effective management
Need to allow those procuring services to make professional judgements on some
wider social impacts, because not everything can or should be measured
©Social Finance 2012