Another week of feast of famine – yesterday we were almost bereft and today we are truly burgeoning! Fascinating news from Asia, Canada and South Africa – happy reading!
Housing First Social Impact Bond Feasibility Study
MaRS
Homelessness is a major issue in Canada, affecting 200,000 people every year and costing $7 billion to the economy. The prevalence of mental illness within the homeless population is higher than in the general population: 50% of homeless individuals have some form of mental illness, compared to 20% of Canadians. Homelessness and mental illness often occur concurrently, significantly affecting individuals and communities. If we include people who are vulnerably housed, as many as 520,000 Canadians lack safe, affordable and supportive housing.
This feasibility study suggests that a Social Impact Bond (SIB) could be used to fund a Housing First (HF) intervention that aims to improve the lives of homeless individuals with mental illness.
Funding broader implementation of Housing First using a SIB would share the implementation risk associated with replication, scaling and modification from governments with investors, and would establish a rigorous performance measurement framework focused on outcomes. A SIB could also be structured to target outcomes that are associated with cost savings.
Boosting SME Development With Social Impact Bonds
Blair Burmeister – Finweek
SIBs in South Africa
The policy paper entitled Exploration of Social Impact Bonds for SME Development was put together by The Bertha Centre for Social Innovation and Entrepreneurship (located within University of Cape Town’s Graduate School of Business), Genesis Analytics and Social Finance in the UK, and was recently presented to Treasury, the Jobs Fund, and the Department of Trade and Industry.
In South Africa, a study conducted in 2010 by Abor and Quartey estimated that 91% of formal business entities in the country are SMEs and that these enterprises account for approximately 55% of GDP and 61% of employment.
Yet the 2012 Global Entrepreneurship Monitor report estimates that only 2% of South Africans own businesses that have been established for over three and a half years, indicating a high failure rate among SA start-ups.
The Bertha Centre for Social Innovation and Entrepreneurship, a partner at Genesis Analytics, says: “Although there is no shortage of BDS providers in South Africa, there is limited evidence on which interventions are effective. SIBs could play a significant role in addressing this limited understanding of what does and doesn’t work.”
Is Asia Ready For Social Impact Bonds?
Thiam Hee Ng – Asian Development Blog
Raising finance for projects which are socially important but have little appeal to hard-nosed investors has been a major challenge for governments and donor agencies in the past. But now a new instrument has been developed which offers a fresh way forward—Social Impact Bonds.
These bonds provide a mechanism for fund raising to meet social objectives, while still providing a return attractive enough to entice investors. It also has appeal to investors who want their investment to have a social impact.