On 20 June, UK charity think tank NPC published a new paper on the future of social impact bonds. Opportunities and Lessons argues that charities are well placed to exploit specialist knowledge in some areas of service delivery, and to influence the way social impact bonds (SIBs) are developed and used in the future. While facing a number of hurdles, charities should seriously consider working alone or in coalition to develop their own SIB proposals, and direct government policy towards delivering more effective interventions on behalf of beneficiaries.
Providers remain positive about the potential of SIBs even after recent poor publicity and the cancellation of the £5 million Peterborough SIB established to try and rehabilitate male ex-prisoners, says NPC. ‘It isn’t for the faint-hearted, but there is a big prize for charities, government and society as a whole if they get it right.’
But two articles by Rick Cohen of Nonprofit Quarterly present a more sceptical picture from the other side of the Atlantic. In an article called Eight States Reduce Recidivism without Social Impact Bonds, Cohen refers to a Council of State Governments report documenting ‘the very promising efforts of eight states … that have actually achieved reductions in recidivism between 2007 and 2010. The distinction between these eight states and the two states that are pursuing recidivism-reduction programs with the help of SIBs (New York and Massachusetts),’ he continues, ‘is that the CSG is documenting system-wide, statewide reductions in recidivism as opposed to project- (or prison-) specific efforts. According to the June 2014 report, “compelling evidence is now emerging that shows that recidivism rates for an entire state can indeed change.”’
The title of the second article, Eight Sobering Thoughts for Social Impact Bond Supporters, speaks for itself.