Interesting detail from each side of the Atlantic this morning, happy reading…
How Social Impact Bonds Can Help Bring Private Dollars To Low-Income Communities
John Griffith – Enterprise Community
The House Ways and Means Committee will hold a hearing on Social Impact Bonds (SIBs), which are innovative financial tools that harness private capital to support critical but underfunded public services. Under a typical SIB contract, private investors cover the cost of a particular social service, while the government agrees to pay investors back only if certain social outcomes are achieved.
The primary focus of today’s hearing is the bipartisan Social Impact Bond Act, which was introduced in June by Reps. Todd Young (R-Ind.) and John Delaney (D-Md.). Among other things, the bill would create a $300 mln fund within the Department of the Treasury to support state and local SIBs, mostly through gap financing. The bill would also establish a new interagency council to identify, finance and monitor local SIB initiatives that are expected to save federal dollars.
GLA Rejected An Adjustment To The First Homelessness SIB To Keep Rough Sleeping Figures Down (subscription)
Heather Spurr – Inside Housing
Last week the government published its review of the first homelessness social impact bond (SIB) in its first year. The £5m ($8.06 mln) payment by results scheme (PBR) – was described by then housing minister Mark Prisk as one that would ‘ensure the best value for money’ when it was launched in 2012.
The Department for Communities and Local Government’s (DCLG) qualitative report highlights some of the successes of the programme, run by the GLA, Thames Reach and St Mungo’s Broadway. Both charities performed ‘strongly’ in getting people into stable accommodation, and achieved ‘above target’ when helping people into sustained full-time employment.
LeapFrog Investments, a private equity firm backed by George Soros and JPMorgan, said it has raised $400 mln for socially responsible investments in Asia and Africa – the largest ever for a fund specialising in low-income emerging market financial services.
The fund, LeapFrog’s second such fund, was three times the size of first raised and was oversubscribed, underscoring the increasing popularity of so-called “impact investing”