Three interesting articles today led by great news of 7 new projects in the UK while NPQ is as cautious as ever about embracing progress and elsewhere a tipping point is being observed, enjoy the read:
UK – Seven New SIBs Launch As Part Of £23m Of Homelessness Funding
Alice Sharman – Civil Society
The government has today announced £23m of funding to not-for-profit organisations to combat homelessness, part of which will fund up to seven new social impact bonds.
The new Fair Chance Fund, which was announced today, is a £15m fund which will pay for sustained housing, employment and educational support for homeless 18 to 24 year olds with investors putting in money now on a “long-term payment by results basis”.
An additional £8m has also been made available from the Help for Single Homeless fund which will support around 22,000 single homeless people around the world.
Seven projects have been awarded a share of the Fair Chance Fund money over three years from January 2015. Those projects are expected to be run as social impact bonds. If this is the case, this will increase the number of SIBs in the UK from 17 up to 24.
The funding comprises £10m from the Department of Communities and local Government, and £5m from the Cabinet Office’s Social Outcomes Fund.
Does Debate About SIBs Need A Shot Of Realism?
Rick Cohen – NPQ
Those with a general stake in packaging and promoting social impact bonds are still waxing enthusiastic, creating an overwhelming din in some circles. Representative John Delaney (D-MD), at the Millennial Action Project’s Congressional Summit on Next Generation Leadership last week, reportedly said that social impact bonds, the subject of legislation that he and fellow Future Caucus colleague Todd Young (R-IN) have introduced, will “drastically increase the philanthropy ‘pie.’” Not many donors expect to benefit from rates of return of six percent to over twenty percent on their philanthropic investments, but that’s now where we are in the nonprofit world, with many people, including national legislators, unable to distinguish the nonprofit and for-profit sectors. Maybe Delaney’s vision of profit-making philanthropy explains some of the challenges nonprofits and foundations have in making their case for congressional action on tax incentives for charitable giving.
However, there are voices in the social impact movement adding notes of temperance and realism. Other SIB promoters are taking somewhat more measured approaches to the SIB bandwagon, though few seem prone toward jumping off, and most are still running hard to grab a seat.
‘Paying For Results’ At A Tipping Point?
Steve Kelman – FCW
It is fascinating to watch new ideas spread. Researchers who study the diffusion of innovative ideas and practices refer to an “S curve” of adoption (first studied literally decades ago in looking at how the use of new high-yield seeds spread among farmers).
At first, only a few venturesome and bold people try something new. Maybe then a few others join them. Many innovations never get beyond these early adopters, and die shortly after birth. But for others, adoption continues, with the use-curve still sloping gently upward over time, still limited to fairly venturesome people willing to go a bit out on a limb, but not quite so bold as the first adopters. Then at some point — which researchers call an “inflection point,” “tipping point” or “take-off point” — use starts to skyrocket. People start adopting a change, not because they are particularly bold, or even particularly convinced about the change on its merits, but because they see so many others doing the same thing. Soon, a change has taken over.
I am wondering whether we are approaching a tipping point in the interest around government in the idea often known as “pay for results.” The pay-for-results mantra is straightforward and (in my view) appealing: If government wants to get another party to do something, stop paying them just for effort, or for producing stuff that doesn’t necessarily accomplish an outcome. Don’t pay job-training providers for providing training courses, pay them for actually getting people jobs.