Social Impact Bond Readiness

BUSINESS CASE

RATIONALE - SIB can be sought to overcome:

  • Fragmented services

  • Reactive spending 

  • Difficulty innovating 

FEASIBILITY - To create a well-reasoned care for feasibility one must first define the 

  • Target cohort - select cohort based on evidence & define characteristics

  • Outcomes - outcomes must be specific, measurable & independently verified.

  • Priced outcomes - price outcomes based on evidence base (financial or historical data) & when they will be paid

FINANCIAL MODEL The financial model should be used to determine the minimum and maximum investment requirement (£)

  • Outlining volume of participants

  • Success at achieving outcome payment milestones

  • All stakeholders (commissioner, investor, provider) understand and support the financial model and understand the implications in terms of budgeting / financial planning / cash flow. 

  • BLF/LCF contribution has been built in 

RELATIONSHIP MANAGEMENT

GOVERNANCE, Senior Executive must:

  • Understands risks & put in place processes to mitigate risk

  • hires an accountable officer

  • Signed off a plan for development process that includes interdependencies & stakeholder management 

  • Puts agreement in place for commissioners to jointly develop the project

  • insight from ongoing service delivery to be analysed

  • staff training

INVESTOR ENGAGEMENT

  • Investors engaged in development of model

  • intermediary worked through financial model

MARKET PROVIDERS

  • identify found new and existing providers

  • Market testing and development, including capacity building & positive feedback on proposed terms

  • Decide whether procurement is a restricted process or an open and competitive process with dialogue (there are implications on governance and service delivery)

  • appropriate contract has been signed

SERVICE DELIVERY

REFERAL PATHWAY

  • Referral pathway has been developed to avoid perverse incentives

  • Meeting regulatory or statutory responsibilities. 

  • Eligibility based on the defined target cohort

  • Decisions on whether its a ‘opt in’ service or not

  • Decisions on how referrals will be communicated to the service user

  • Decisions on how opt out, drop out and attrition will be managed and recorded.

INTERVENTION MODEL

  • Clarity on how to specify and access the desired interventions 

  • Strategy specified for co-designing the intervention with stakeholders 

  • In the case of a 'black box' intervention approach, a specific defined approach to ongoing contract and performance management is in place

CLIENT JOURNEY & SERVICE INTEGRATION

  • How a client will experience the service, including the role of the intervention(s). The client journey clearly integrated with existing services

EVALUATION (IMPACT & PROESS)

  • Theory of change has been provided. 

  • Understanding of the baseline and counterfactual

  • plan in place for independent data verification 

  • plan in place for evaluation of the SIB

LEGAL & REGULATORY REQUIREMENTS

  • Regulatory requirements relating to the service considered and planned for 

DATA, REPORTING & PERFORMANCE MANAGEMENT

  • Systems are in place to report on the project progress and achievement of outcomes

  • Payment processes are in place (particularly where there are multiple commissioners involved)

  • The project is GDPR compliant and required data sharing agreement are in place

ONGOING LEARNING & REVIEW

  • Processes and structures in place for input from stakeholders and ongoing learning

  • An evaluation is set up which includes a process for integrating learning when the service ends, including realising savings or system-wide benefits where appropriate

ACRONYMS 

BLF - Big Lottery Fund

LCF - Life Chances Fund is an £80m fund

SIB - Social Impact Bond

ImpactInvestmentFrancesca Tabor