March 11, 2013
BC explores social impact bonds
Social impact bonds (SIBs) hold the potential for government to increase health and social outcomes while decreasing costs, which is why the B.C. government is exploring them closely, says Gordon Hogg.
The MLA for Surrey-White Rock and former parliamentary secretary for social entrepreneurship says SIBs, which were first successfully pioneered in the United Kingdom, are drawing interest from governments across the globe including uptake in the United States and Australia.
There is enthusiasm for this new social finance tool because it offers government a way to promote innovation and tackle challenging social issues without high risk or disrupting their current services.
Here’s how an SIB works. A non-profit or other organization that has an innovative approach to a health or social problem approaches the government with their model. If the government agrees that this approach could say, for example, decrease re-admission rates of young offenders, it would agree to split a portion of the government savings with the organization.
With this agreement in place, the organization can now seek out investors for the program. The government only has to pay a SIB if and once the agreed social objectives are met.
According to Gordon, SIBs could be used in a variety of ways across the province: from decreasing the number of Type 2 diabetic hospital visits to preventing aboriginal children from entering state care.
It’s the latter example that the B.C. government and the B.C. Association of Aboriginal Friendship Centres are considering. First Nations children and youth end up in state care at a higher rate than the rest of the population. To change this, the B.C. Association of Aboriginal Friendship Centres is identifying the factors leading up to the child entering state care, and how a program could address those, preventing the child from being taken away from family.
One model that offers promise is from West Australia called Family By Family. The model pairs a family that is experiencing dysfunction and struggling with a family that is thriving but has experienced dysfunction in the past.
“What they’re finding is that when families are matched with each other mentoring and social relationships develop, and they’re able to have better social outcomes,” says Gordon, adding this is harder to achieve with a social worker who represents the state.
“It’s a more creative way to address and use the resources of the whole community,” Gordon adds on the potential of SIBs.
“We would like to get to our first social impact bond, I think that would be a wonderful step forward.”
Prepared for enp Canada by Axiom News.
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