“The results show that the new funding mechanisms are neither the cure-all remedy for every social problem or public funding shortfall as promoted by some nor the guaranteed disaster in every circumstance warned against by others” says the US National Council of Nonprofits (albeit I am not sure PFS was ever touted as a cure-all for everything: a PFS military, for instance, presents specific challenges). Anyway a further step forward in the US while an Australian pension fund NGS Super records excellent ‘win win’ results from its first SIB investment in the “Newpin” project.
The National Council of Nonprofits (Council of Nonprofits) today released “Principles for Consideration of New Funding Mechanisms,” providing nonprofits, governments, foundations, and for-profit entities with guidance on issues that must be considered before launching pay-for-success initiatives, social impact bonds, or other new funding mechanisms.
As interest in pay-for-success initiatives and social impact bond programs have spread in recent years at the local, state, and federal levels, these experiments have had mixed results. The results show that the new funding mechanisms are neither the cure-all remedy for every social problem or public funding shortfall as promoted by some nor the guaranteed disaster in every circumstance warned against by others. Rather, they are nuanced tools that can be appropriate in certain situations. The Principles will help parties contemplating alternative funding arrangements set expectations and avoid unintended consequences as they seek to address community problems.
Darren Snyder – Financial Standard
Industry fund NGS Super says an investment in Australia’s first social benefit bond has rewarded members with both social and financial returns, aligning with the fund’s environmental, social and ethical investment framework.
The New Parent and Infant Network (Newpin) Social Benefit Bond recently reported positive results for its third consecutive year, returning 12.15% to investors. NGS Super said this is on top of previous yearly returns of 8.9% and 7.5%. The fund’s initial investment was $500,000 in 2014.