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One of the big strengths of the scheme is that it is funded for a long period of time. There has been plenty of opportunity for the One Service to put proper structures in place and to experiment with new ideas. Without a social-impact bond or something similar to ensure this long-term flow of working capital from private investors, however, providers will have to raise their own money and take the risk of not being paid if things do not go to plan. Mr Grayling has ruled out any additional public spending for his “rehabilitation revolution”, so one question is how providers will gain access to working capital over a long period of time.
Another strength of the Peterborough scheme is how it is monitored. The scheme is co-ordinated and run by Social Finance, a non-profit organisation, whose job includes keeping investors informed about progress. Data dashboards show everything from how being met at the gates affects reoffending rates, to month-on-month comparisons of case workers’ activities. Again, the structure of the social impact bond helps: it is a contractual mechanism that ensures investors, commissioners and providers agree on outcomes and maintain constant communication about progress. The task for Mr Grayling is how to replicate this monitoring process on a much bigger scale.
Instiglio co-founders Michael Belinsky and Avnish Gungadurdoss are finalists for the Echoing Green Fellowship! Instiglio was selected from among “nearly 3,000″ applicants, according to Echoing Green. The 50 finalists will present their innovations at before Echoing Green judges in May 2013. Read more here.
Today the Federal Reserve Bank of San Francisco published a 139-page issue of Community Development Investment Review devoted entirely to social impact bonds. Instiglio co-founder Michael Belinsky joins four other co-authors and members of the Harvard Kennedy School Social Impact Bond Technical Assistance Lab on an article describing lessons learned from implementation of social impact bonds in the United States. The Review is here and the article is here.
The Harvard Kennedy School Magazine highlights Instiglio’s work in international development in its Winter 2013 edition.
Harvard Kennedy School Magazine, Winter 2013
Quote from the sidebar:
Michael Belinsky MPP 2012, Michael Eddy MPA/ID 2012, and Avnish Gungadurdoss MPA/ID 2012 founded Instiglio, a company whose mission is to take the social impact bond model to developing countries. Instiglio has embarked on a partnership with the Colombian state of Antioquia, conducting feasibility studies of programs to reduce the number of school dropouts and prevent unwanted pregnancies.
In December 2012, the U.S. Agency for International Development (USAID) informed Instiglio of its “intent to award” the company a grant for its Colombian efforts through an agency program that “aims to find and support breakthrough solutions to the world’s most important development challenges.” If the grant is finalized in early 2013, as expected, Instiglio will receive $100,000 from USAID to establish it’s “proof of concept” and could potentially receive millions of dollars to implement the founders’ ideas in Colombia and elsewhere in the world
The Economist highlights Instiglio’s projects to develop results-based financing programs in developing countries in its print edition.
Social Impact Bonds: Commerce and Conscience
February 23, 2013, print edition
And there is rising emerging-market interest in SIBs, where they go under the name of “development-impact bonds”. According to Michael Belinsky of Instiglio, a start-up devoted to designing SIBs in poor countries, there is less scope for government savings to pay back investors in emerging markets because social safety nets are thinner. So international-development agencies are more likely to act as sponsors. Mr Belinsky is working on potential SIBs in India, to improve educational outcomes for girls in Rajasthan, and in Colombia, to reduce teenage-pregnancy and school drop-out rates.
Check out our job posting on the GIIN Career Center:
We are thrilled to announce that Echoing Green has chosen Instiglio as one of its 300 semi-finalists for the 2013 Echoing Green Fellowship. Learn about the announcement and the other semi-finalists here.
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