Piloting a social impact bond in Ireland
Last week we invited Mike Allen, Director of Advocacy at Focus Ireland and President of FEANTSA, to present Focus Ireland’s experience in a pilot project on Social Impact Bonds (SIBs).
In fact Focus Ireland (a FEANTSA member) is actively exploring the use of SIBs in a project focusing on homeless families living in temporary accommodation in Dublin. Mr Allen explained that the Irish Government is piloting the SIB. Slightly detached from the theoretical structure of SIBs, this project is actually running without any external investor but only with the support of the commissioning public authority involved, which is acting also as delivery agency in the research of interested investors. Focus Ireland is the only organisation involved in the project implementation as service provider.
The program formally started in 2013 and aims to move 136 homeless families from privately owned emergency accommodation into sustainable homes with social services support. Since the private landlords were paid by the Municipality, the implementation of this project is estimated to save around 3 million euros per year.
The role of Focus Ireland is in providing social services to help the families to move from one home to another, separately addressing children and family issues. Social support is limited to a 6 months average period. When families were living in emergency accommodation without any social service support, it is estimated that many children drop out of school.
Based on his experience, Mr Allen stressed that SIBs are not a sustainable tool for financing social services. However, in his view, they can be useful for particular circumstances:
- where other tools do not work
- when there is a clear medium term financial saving compared to the cost of inaction, making things happen that otherwise would not happen
- when different departments of the public authorities cannot reach an agreement, because one does not want to invest but the success of the other depends on the first one’s choice: this can be solved by an external contribution
- to anticipate money to experiment a new intervention that governmnets or public authorites wouldn't have.