Monday, March 20, 2017

Commissioning for Outcomes – The role of social finance

Can social finance help with the challenges that public commissioning faces?

This paper is intended as a provocation to government, commissioners, providers and investors to begin a richer conversation that doesn’t assume we already know the answers. OPM’s experts in commissioning for outcomes (Sue Goss) and in social finance (Chih Hoong) draw on their learning about systems leadership, experience of teaching commissioning programmes and our work in evaluating social investment experiments.

Wednesday, February 22, 2017

Independent evaluation of the Essex Multi Systemic Therapy Social Impact Bond

For the past three years OPM has undertaken an independent evaluation of the Essex County Council Multi Systemic Therapy (MST) Social Impact Bond (SIB). The Social Impact Bond delivers MST to children and young people at risk of being taken into the local authority care.  The Social Impact Bond has been managed by Children’s Support Services Ltd, a Special Purpose Vehicle, established by Social Finance.

The purpose of OPM’s work has been to evaluate the potential added value that can be achieved through local authority and other commissioners using Social Impact Bonds as a mechanism for financing the delivery of new services.  Specifically, whether the use of a SIB impacted on the implementation of MST and whether significant value was added to either outcomes or performance.

The evaluation highlights many instances where the use of the SIB has been seen to add value to systems and processes and indirectly to overall performance.  It also draws attention to some additional costs and complexities which may result from operating through a SIB and how these can be mitigated.  Drawing on a variety of quantitative and qualitative evidence and insights, OPM have now summarised their findings and used this to inform a set of recommendations applicable to organisations that may be considering developing SIBs of their own.

In addition, OPM have drawn on the evaluation findings to develop a new guide on ‘Top Tips for developing and implementing a Social Impact Bond’ – an interactive document for commissioners, providers, funders and managers.  While summarising the Essex experience and including examples from Essex to illustrate specific points, this also brings in themes from the wider evidence base, with the aim of distilling lessons that have wider applicability.

The Essex SIB was the first local authority commissioned SIB to be established in the UK and the experience and findings reflect its innovative nature.  It was launched in 2013 and will be operational for five years, concluding in 2018. Two teams from Action for Children have delivered an MST intervention to approximately 260 young people to date resulting an in an approximately 80% rate of successful care diversion.   MST is an evidence-based programme that seeks to improve parenting and rebuild positive family relationships, enabling families to manage future crisis situations themselves.

 

 

 

 

 

Monday, October 17, 2016

Helping service providers access social investment

We know from our extensive engagement with service providers that a growing number are interested in exploring Social Impact Bonds or other forms of social investment to help them secure longer term contracts or to scale up their services. The £80m Life Chances Fund offers new opportunities for service providers to engage in outcomes-based contracting through a Social Impact Bond model. However, many do not know where to start and may be know how to decide whether a Social Impact Bond is appropriate.

In line with our values as a public interest company, we have produced this simple and free-to-download Service Provider Toolkit aimed at helping service providers think through whether a Social Impact Bond may be right for them. It also includes 10 Top Tips and signposting to other resources.

We would like to thank Michelle Farrell-Bell, Regional Director (North-West) for Teens and Toddlers, for her insights and feedback on an initial version of this toolkit.

Monday, October 17, 2016

Social investment toolkit for service providers

We know from our extensive engagement with service providers that a growing number are interested in exploring Social Impact Bonds or other forms of social investment to help them secure longer term contracts or to scale up their services. The £80m Life Chances Fund offers new opportunities for service providers to engage in outcomes-based contracting through a Social Impact Bond model. However, many do not know where to start and may be know how to decide whether a Social Impact Bond is appropriate.

In line with our values as a public interest company, we have produced this simple and free-to-download Service Provider Toolkit aimed at helping service providers think through whether a Social Impact Bond may be right for them. It also includes 10 Top Tips and signposting to other resources.

We would like to thank Michelle Farrell-Bell, Regional Director (North-West) for Teens and Toddlers, for her insights and feedback on an initial version of this toolkit.

Monday, September 12, 2016

Social Impact Bonds in Japan

Japan’s first steps in developing Social Impact Bonds

April, 2017

I am in Tokyo for a third year running, this time to find out about the experiences of the Yokohama City Social Impact Bond (SIB) pilot. It has been a real privilege working with a diverse group of stakeholders from the outset as they initially learned about the UK experience in implementing SIBs, and then took steps to develop and test a model for Japan. I have written previously about specific learning shared with Japanese colleagues. In this blog, I make further comparisons between the Japanese and UK experiences.

Travelling well?

SIBs originated in the UK and have since spread to many other countries. It is easy to understand why the idea of a SIB is so attractive to governments internationally. It purports to only ‘pay for success’ and holds the promise of helping governments save money.

Japan contributed to the OECD’s Social Impact Investment Taskforce’s work to better harness the power of entrepreneurship, innovation and capital for public good. The Japanese Ministry for Education, Culture, Sports, Science and Technology has been funding a five-year study by a consortium led by Meiji University, while three other Central Government departments have expressed interests in developing SIBs. The Nippon Foundation has also played an intermediary role in coordinating three small-scale early pilots in 2015.

It is fair to say that as SIBs developed within and beyond the UK, there has been a constant process of adaptation. Each country has had to do a considerable amount of ‘translation’ to enable the model to be implemented in its particular national, regional and local context.

Japan, similarly, is trying to figure out an appropriate form of SIB that suits its unique socio-political, economic, and cultural milieu. For example, voluntary sector organisations tend to be small and hyper-local; there is a lack of participative governance in terms of the structure of central and local government relationships; and despite the huge national debt the government has no problems accessing cheap capital.

It is therefore naïve, and frankly wrong, to think that there is a singular SIB model that can be transposed with ease.

What might help?

Japan, drawing lessons from the UK, recognised the importance of stimulating the development of a social investment market. Taking a lead from the model set by the UK in creating Big Society Capital (BSC), Japan recently passed the Dormant Bank Account Act whereby a portion of the money will be transferred to a foundation independent from government who will act as a wholesaler (like BSC) in which money is lent or invested in social investment intermediary institutions who go on to invest in frontline social sector organisations. There is also interest in setting up impact bond funds, akin to the ones in the UK.

However, it is not sufficient if governments only see their role in terms of providing the money either to pay for outcomes or to grow the social investment market. In Japan, we hear that the pilots have struggled with being able to identify the right outcome metrics and being able to conduct measurement consistently and robustly. This area seems under-developed in comparison with the UK where the government has invested significantly in developing the evidence base for outcome measurement and for pricing outcomes.

The UK government has also set up the Government Outcomes Lab: a partnership with the Blavatnik School of Government at the University of Oxford, to support commissioners to better engage with outcomes contracting.

There has been legislative change that support development in this area. For example, the social investment tax relief aims to attract individual social investors, complementing Big Society Capital’s effort at growing the market of institutional investors. The Public Services (Social Value) Act additionally requires public bodies in England and Wales to give due consideration to improving local economic, social and environmental outcomes through commissioning.

I will be encouraging participants at the Social Impact Forum at Yokohama City on 22 April 2017 to consider the specific forms of support that should be put in place, and who might be responsible for doing what, to enable SIBs and social investment more generally to flourish in Japan, and in ways that truly bring about social outcomes.

Dr Chih Hoong Sin, Director Innovation and Social Investment – he has been expert advisor to the Japanese Government since 2014 who are keen to explore the potential for implementing Social Impact Bonds in Japan.

 

Pre-2017

Background

The Japanese Government, as part of the Social Investment Group on the G8, expressed an interest in exploring the potential for implementing Social Impact Bonds in Japan in a way that was sensitive to local contexts.

What did we do?

Dr Chih Hoong Sin was invited to share lessons learned from the UK with a Japanese contingent that visited in November 2014. He was subsequently invited by the Japanese Government visit Japan to advise representatives from central and local governments, and charitable foundations, in March 2015. This involved numerous meetings with various stakeholders, covering  diverse aspects such as resourcing; outcome measurement; the role of local voluntary and community sector organisations; implementation, etc. He was further invited to share learning with a second Japanese contingent that visited in October 2015, with a third visit scheduled for September 2016. He was invited back to Japan in April 2016 to advise Japanese colleagues and to speak at a national conference.

Outcome

The work led directly to Japan taking the first steps in setting up feasibility studies in three prefectures. These were launched in July and August 2015, and funded by the Nippon Foundation. Dr Chih Hoong Sin continues to advice Japanese colleagues, particularly in their first year of implementation. Chih Hoong is currently also providing expert advice for the Yokohama SIB – Japan’s first SIB. Chih Hoong has written a series of blogs about this activity.

Monday, September 12, 2016

Analytical support to the Newcastle Ways to Wellness Social Impact bond

OPM Group has been asked by Ways to Wellness, the Special Purpose Vehicle (SPV) set up to implement the Newcastle Social Impact Bond, to provide specific analytical support to help them understand ‘what works’.

Background

The Newcastle SIB is the UK’s first health SIB and is very high profile. With four providers delivering the intervention, and supported through an SPV, they have been collecting significant amounts of data on activities, outputs and individual-level outcomes as measured by an Outcome Star.

What did we do

Ways to Wellness approached OPM Group to provide them with expert analytical and advisory support to help them organise and manage the data in a way that will support learning and improvement. This further involves helping them improve their internal data management systems and IT, as well as developing a coherent analytical framework.

Outcome

Although the project is ongoing, we have already provided specific recommendations for data management systems and have helped Ways to Wellness develop a series of hypotheses to be tested. We have also made emerging sets of recommendations on service-user segmentation.

Monday, September 12, 2016

NEW Devon CCG outcomes-based commissioning demonstrator for alcohol dependency

OPM Group has been providing commissioner advisory support to North Eastern & Western (NEW) Devon Clinical Commissioning Group (CCG) to initially explore the feasibility of an outcomes-based commissioning approach for tackling alcohol dependency. Following the feasibility study, OPM has been asked to support the CCG to develop a full business for a Social Impact Bond.

Background

NEW Devon CCG (with partners Devon County Council, Plymouth City Council, SW Academic Health Science Network, University of Plymouth, Royal Devon and Exeter NHS Foundation Trust, Plymouth Hospitals NHS Trust, and Exeter CVS) secured a development grant from the Commissioning Better Outcomes Fund to explore the feasibility of an outcomes-based commissioning approach for tackling alcohol dependency. This is seen as a demonstrator project, and will inform wider commissioning practice in the region.

What did we do?

We have been providing commissioner advisory support for the feasibility study, with additional lead responsibilities for outcome and financial modelling. Following the successful completion of the feasibility study, we are invited by NEW Devon CCG and partners to continue supporting the development of a full business case for a Social Impact Bond to tackle alcohol dependency. This includes project management support, specific lead responsibility in further financial and outcome modelling, support for provider engagement, and support for investor engagement.

Outcome

The feasibility study was completed successfully, with the Executive and Finance Committees at the CCG approving work for a full business case. We contributed to a learning and reflection session and have been sharing the lessons learned with other colleagues within the CCG and partner organisations.

Monday, September 12, 2016

Peninsula Local Services Integrated Trust (LIST) feasibility study into a Social Impact Bond model for preventing children from entering care

OPM Group supported Peninsula LIST, a special purpose vehicle set up by the local authorities of Devon, Cornwall, Torbay and Plymouth, to explore the feasibility of commissioning an intervention designed to keep children from entering care through a Social Impact Bond model.

Background

The four local authorities in the South West were keen to explore not only the potential of a SIB model for commissioning services, but also to do so via a Special Purpose Vehicle that will enable the commissioners to adopt a flexible approach in attracting a wider range of commissioners over time. There was also interest in the SPV, potentially, being an instrument for drawing down finance as well as generating income.

What did we do?

The project was specifically in relation to children on the edge of care, and involved an audit of project processes, assessment of the LIST and Social Impact Bond business models and capture of lessons learnt and best practice from the project. This involved looking at potential investor interest and motivation; examining the effectiveness of structures and processes that engaged with practitioners and the public; critically scrutinising the business case and relevant risks; as well as assessing the evidence base that supported various alternative interventions.

Outcome

The project directly influenced strategic decisions taken by the four local authorities, who came to the conclusion that a SIB model will not be appropriate for all four areas. Instead, individual authorities, such as Torbay, proceeded to explore feasibility in their local authority area; while Cornwall took the decision to provide an identified intervention in-house. The SPV model of co-commissioning has since influenced subsequent SIB models elsewhere.

Monday, September 12, 2016

Essex County Council Social Impact Bond for Multi-Systemic Therapy

OPM Group has been conducting a three-year evaluation of the first local authority-led Social Impact Bond in the UK and worldwide

Background

Essex County Council, with funding from the Department for Work and Pensions, the Department of Health and the Cabinet Office, commissioned the evaluation of the Essex SIB with the aim of learning from the experience and informing the development of future SIBs. The evaluation is the only one in the UK, to date, that focuses on the impact of the SIB itself (rather than the impact of the intervention procured through a SIB), and looks at whether this model for commissioning adds value.

What did we do?

Three annual iterations of surveys, interviews and focus groups with a range of commissioners in Essex and other local authorities that have commissioned MST (but not via a SIB); with social investors; with intermediary organisations; with strategic and operational staff from the service provider; with other professionals in the local area working on related services; as well as key stakeholders in the three Central Government departments.

Two additional unique features of this work are: (a) the convening of an international practice share group to draw on emerging learning from the global community and to feed in lessons learned from Essex; and (b) an economic assessment that surfaced (and monetised) a number of ‘invisible costs’ associated with the SIB, borne by Essex County Council, the service provider, and others.

Outcome

This work has attracted significant attention from the outset and on an ongoing basis. Formative lessons learned are regularly fed back not only to Essex but also to the Central Government departments. The Essex experience has directly influenced later SIBs. Within Essex, we facilitated three learning sessions for commissioners and those in commissioning support functions. There has also been annual conferences to disseminate findings and lessons learned more widely.