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This is our monthly policy briefing for May 2021. Each week we gather all the news, commentary and events from across the sector, then tie it all together each month. If you would like to get this in your inbox each week you can sign up to Tiny Letter

Innovative cross-sector partnerships in Europe

With public finances around the world placed under significant strain by the pandemic, utilising the resources of the broader economy – the private and third sectors as well as the public sector – will be crucial to tackling both new and persistent social challenges.   

In the last month, much of this broader discussion has centred on Europe. The GO Lab (in partnership with the European Investment Advisory Hub) launched a new introductory guide to social outcomes contracting in the EU. The guide provides practical advice for policymakers, public sector officials, and other practitioners interested in the adoption of outcomes-based approaches, as well as examples from emergent practice across Europe. 

Meanwhile, the Stanford Social Innovation Review continued their European Perspectives on the Emerging Social Economy series, offering a range of perspectives on building the European social economy. Authors considered a range of opportunities to leverage the social economy for wider social benefit, including the role of government in supporting social innovation; the potential for the use of socially responsible public procurement to address social challenges by leveraging the social economy; the importance of shifting measurement from proving impact to improving impact; and the opportunity for social businesses to be a model for the private sector to shift from shareholder to stakeholder capitalism

And around the world

Themes of innovation and cross-sector partnerships are not limited to Europe. As part of a series of briefings on the future of social impact bonds (SIBs) from MMU’s Policy Evaluation and Research Unit and USC Price, Dr Chih Hoong Sin examined the approach taken by Asia Pacific countries to SIBs. He notes their different priorities, with a focus on working within or around existing bureaucracies and taking innovations to scale, and highlights three examples of variation on the traditional SIB model. Another new SIB development comes via New South Wales, Australia, where the recently-launched Living Learning program has adopted an innovative financing mechanism. The SIB is financed through a 'philanthropic impact investment' model which enables a trust or foundation to combine corpus and grant funding in a 'split tranche' structure, unlocking funds not traditionally used to drive social impact. 

As SIBs take on new forms around the world, we’re also seeing efforts to promote greater scale, often through the use of outcomes funds. In this blog reflecting on a recent Engaging with Evidence session, GO Lab Research and Policy Associate Tanyah Hameed, explains the difference between outcomes funds and impact bonds, before examining three ways in which funds are evolving over time: shifting away from rate cards towards greater flexibility, encouraging collaboration between local and national government, and supporting systemic change and development.  

According to a recent blog from Brookings, outcomes funds and social impact bonds are both examples of ‘new PPPs’ - 'partnerships for public purpose' rather than 'public-private partnerships', emphasising the focus of the partnership on public purpose rather than the status of its members - which can provide innovative approaches and foster genuine collaboration to address social challenges. It may be simply another addition to the alphabet soup of cross-sector partnership acronyms, but if the recent flurry of interest in both Europe and further afield is anything to go by, there appears to be genuine interest in the substance beneath the name. 

And in other news...

In the world of outcomes-based contracting, this piece in The Conversation reflects on the lessons from South Africa’s first two social impact bonds, which concluded last year. And Tanyah Hameed joined this recent event, which explored how outcomes-based commissioning can be used to provide a holistic, person-centric approach to refugee integration, in light of the UK Home Office's newly announced Refugee Outcomes Transition Fund (RTOF). 

Finally, as the UK approaches the end of its Covid-19 lockdown roadmap, attention has begun to turn to the Government’s broader domestic agenda. Top of that list is ‘levelling up’, the much-feted agenda to address stark regional inequalities, broadly between London and the South East, and the rest of the United Kingdom. To date, government funding has focused on physical infrastructure; however, data from the newly launched UK Prosperity Index suggests that overall prosperity is being undermined by factors like social capital, health, and community security.  

The point is reiterated by an article calling for greater focus on ‘community infrastructure’ in the levelling up agenda, which cautions that the centre's focus on large scale physical infrastructure is often at odds with local appetite for more socially focused projects. Once again, it seems likely that innovative approaches will be required to deliver solutions to these social challenges. 

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