India looks set to ramp up the SIB revolution while some media like WashPo remain naturally reluctant to accept that America got prosperous through free markets. Said caution about innovation strikes me as a tad UnAmerican. Net positive but clearly there remains a problem that the big government movement hasn’t got the memo that the state has run out of money…
‘Government Only Pays For The Positive Outcomes.’ A Strikingly New Approach To Social Problems.
Lenny Bernstein – Washington Post
Dubbed “Pay for Success” by the White House, which is cheerleading the effort, the approach is also known as “social impact bonds.” Pioneered in Britain in 2010, it is so new that there appears to be no independent research on its overall effectiveness, though some think tanks have written approvingly of the model.
Tradeable Education Bonds, Social Impact Bonds: Can Budget 2016 accelerate India’s education?
Business Insider
Education bonds in both the public and private sector have been suggested by experts such as Meena Sengupta as a way to deepen the market for investments in education. According to her, tradable education bonds could be used to fund libraries, research, travel grants, student social enterprises and national scholarships. Education bonds are rarely seen in India , even though is entirely logical for education ventures, even if they are not for profit, to increase the range of their funding options by seeking debt in the open market.
The other side to this is social impact bonds, which refer to a new innovation where government enters into a contract with a private sector intermediary for achieving social objectives. The intermediaries are responsible for raising capital from investors, and based on whether the project achieves its objectives, the government repays the investors. The first such bond in India has been launched to improve educational outcomes in Rajasthan. The budget need not be just an exercise in fund allocation, but rather an innovative tool for promoting our development goals, particularly in education.