Framing pay for success

1. Framing pay for success Social Finance is authorised and regulated by the Financial Conduct Authority FCA No: 497568 28 march 2014 Toby Eccles, Founder & Development Director toby.eccles@socialfinance.org.uk

2. CASE STUDY: Re-offending Rates in the uk AVERAGE NUMBER OF PREVIOUS JAIL TERMS AVERAGE NUMBER OF PREVIOUS OFFENSES RECONVICTION RATE WITHIN 1 YEAR 7 63% 43

3. Peterborough SIB MODEL INVESTORS Return depends on success £5 million MINISTRY OF JUSTICE/ BIG LOTTERY FUND Payment based on reduced convictions HMP PETERBOROUGH SOCIAL IMPACT PARTNERSHIP Reduction in re-offending Other Interventions St. Giles Trust Ormiston Trust SOVA MIND 3,000 male prisoners sentenced to less than 12 months

4. global action on impact bonds has surged • Outcomes Funds • £20m UK fund • White House proposal for US$300m fund • Specialist intermediaries • 6 organizations with a core focus on bonds • Organizations in at least 10 other countries exploring impact bonds • UK • 14 SIBs for issues that range from recidivism to homelessness by UK government, Social Finance and others • The Netherlands • One SIB on youth unemployment by Rotterdam City, ABN AMRO and others • US • 3 SIBs, including a US$27m SIB, for high risk youth, early childhood education and recidivism by Goldman Sachs and others • One SIB on recidivism by New York State, Merrill Lynch, Social Finance US and others • Harvard Lab providing technical assistance to 9 state governments • G8 Taskforce on Social Impact Investment • Focused on developing policy to scale solutions such as impact bonds • Australia • 2 SIBs on out-of-home care by New South Wales State, Social Ventures Australia and others • Latin America • IDB’s MIF launching US$5.3m facility to support SIB ecosystem building and pilot SIBs • South Africa • BDS bond by Bertha Center, Social Finance and others • Swaziland • HIV prevention DIB by CHAI and Social Finance • Mozambique • Malaria DIB by Nando’s, Dalberg and others • Uganda • Rhodesian Sleeping Sickness DIB by DfID and Social Finance Social Impact Bonds launched Market infrastructure established Development Impact Bonds under exploration / development

5. How sibs can add value INVESTIBLE CLIENT-CENTERED PARTNERSHIP INNOVATION FLEXIBLE RIGOROUS

6. Focusing on ADAPTIVE management FLEXIBLE CONTRACT DATA COLLECTION & ANALYSIS BETTER PERFORMANCE MANAGEMENT & RESULTS DELIVERY IMPACT

7. FREEING UP SERVICES TO BE BETTER • Serving the funder • Checking receipts • Feedback from regulators & politicians • Ensuring services stay the same • Serving the user • Checking results • Feedback from service users & impact measurement • Ensuring services improve FROM TO

8. SHIFTING From “business as usual”

9. NOT LOSING SIGHT OF THE SOCIAL CHANGE Program System Focusing on service users Measuring program effectiveness Promoting flexibility for adaptation Facilitating investment Crystalizing value to government Having pressure to improve

10. Contact details Email toby.eccles@socialfinance.org.uk Twitter @socfinuk @tobyecc Web socialfinance.org.uk socialfinanceus.org Your questions?

11. Peterborough SIB MODEL INVESTORS Return depends on success £5 million MINISTRY OF JUSTICE/ BIG LOTTERY FUND Payment based on reduced convictions HMP PETERBOROUGH SOCIAL IMPACT PARTNERSHIP Reduction in re-offending St. Giles Trust Providing specialized support pre- and post- release to high/medium risk clients Providing volunteer support pre- and post- release to low risk clients SOVA MIND Low level mental health support to prisoners while they are in prison and post release Support needed by the prisoner, in prison and the community. Funded as the need is identified Other Interventions Ormiston Trust Support to prisoners’ families while they are in prison and post release 3,000 male prisoners sentenced to less than 12 months

12. SHIFTING From “business as usual”