Guest blogger Rob Wilson, Minister for Civil Society, discusses expanding social action and encouraging social investment to transform public service delivery...
As Minister for Civil Society I’m delighted to be able to contribute to #BetterServices month - working with the Public Service Transformation Network to share how we are working with our partners in civil society to improve the way services are delivered - and ultimately to improve outcomes for people.
I want to highlight two key ways in which we are working to make this happen:
Social action
I am committed to expanding the role of social action. We are facing challenges that government cannot tackle on its own, like an ageing population, whilst expectations of public services increase.
We know social action - whether volunteering, giving, community action or simply people helping people – can play an important role. Projects with social action at their heart can offer support beyond the capacity and reach of the public sector.
One example is King’s College Hospital, where there are now over 1,500 volunteers providing more than 250,000 volunteering hours a year. In 2010, it overhauled its volunteer programme, asking staff for ideas on ways they wanted to support patients, but simply did not have time to do. The hospital therefore started offering volunteers more frontline roles, like welcoming patients and holding their hands and is piloting roles outside the hospital too. Patient satisfaction is higher amongst people who’ve had contact with a volunteer and the service demonstrates the powerful role volunteers can play within public services, complementing existing provision.
Charities, community groups and social enterprises are frequently closer to the people who need help and we are also seeing how social entrepreneurs are reconceptualising the way support is provided. Take Shared Lives Plus, which matches people willing to give their time and share their homes with vulnerable adults who need support to live independently. Already nearly 7,000 volunteers are supporting almost 10,000 vulnerable adults through this approach, a radical, innovative way of providing support.
The challenge we face is to support these projects to grow so that what currently looks innovative quickly becomes the norm.
That’s why we launched the Centre for Social Action. Through this £40 million partnership with Nesta, we are backing more than 150 social action projects to develop and scale up, from helping young people to reach their potential to supporting people through old age.
We’re also empowering communities. We have recruited and trained more than 4,500 community organisers – individuals across England who inspire communities to take action on local issues.
We’re also, through our Community First programme, enabling volunteer-led panels to allocate government funding to local causes – already over £23 million has been distributed to over 15,000 local projects. At the core of all these programmes is the desire and ability of communities to take a lead in responding to challenges they face.
As we design and shape services, it is therefore up to all of us to consider how best we can harness the incredible energy and commitment of individuals, businesses and communities across the country to help people in need.
Social investment
Social investors are people who invest their money to have a measurable social impact, alongside a financial return. This can create pools of capital and expertise to support policy interventions and reduce public funding requirements in the long-term. There is around £1 billion of social investment available in the UK.
Our work to grow the social investment market - connecting these socially minded investors with charities and social enterprises looking for finance to grow - has led to great results in areas like homelessness, re-offending, adoption, education and many more.
The government’s social investment market strategy is achieving these results in three specific ways: enabling innovation in public service delivery; creating diverse public service markets; and enabling sustainability.
Firstly, innovation. Social investors are interested in outcomes based delivery. Social Impact Bonds (SIBs) bring these investors together with public service commissioners, to test innovation and enable voluntary, community and social enterprise organisations to take part in payment by results contracts. Rather than focusing on inputs or outputs, SIBs are based on achieving social outcomes. This approach also allows innovation because the government doesn't specify how the outcome should be achieved - provider organisations can try new approaches and be flexible if an intervention isn't working. We are supporting the SIB market by:
- Setting up the Centre for SIBs to provide advice and guidance to commissioners, providers and investors.
- Setting up the Social Outcomes Fund which is a top-up fund, giving out £20 million to SIBs or payment by results (PbR) projects that work on complex and expensive social issues.
- Working with other government departments to test SIBs in youth unemployment and homelessness to try new solutions to these complex issues.
Secondly, social investment creates diversity in public service markets. The UK has one of the most developed social economies in the world. There are around 180,000 social enterprise SME employers, contributing £55 billion to the economy and 2 million jobs each year. The government’s investment readiness programme (made up of the Social Incubator Fund and then Investment and Contract Readiness Fund) has helped these organisations to get ready to take on social investment and deliver public service contracts. We have funded 10 incubators through our £10 million Social Incubator Fund. These social incubators provide non-grant finance and business support to early stage social ventures. For social ventures looking to operate at scale, we established the Investment and Contract Readiness Fund. This fund has committed over £12 million to support 141 ventures to raise investment or win contracts. Already, 55 of these ventures have already won investment or contracts.
Thirdly, social investment enables services to become sustainable. Social investment models bring a broad range of expertise to bear, enabling a new way of thinking about service delivery.
For example, Greenwich Leisure Limited (GLL) is the UK’s largest charitable social enterprise in its field, delivering leisure, health and community services for the benefit of everyone. In 2013, GLL issued a £5 million five year bond offering investors a fixed gross return of 5% per annum. The issue attracted interest from over 300 individual retail investors and from a number of established institutional investors such as the Rathbone Ethical Bond Fund. The money raised through the bond enabled GLL to refit a number of the Olympic venues for the benefit of people living in the host boroughs and wider community and to develop sites in other areas so that local people can enjoy inclusive and accessible fitness facilities.
Another new approach we are pioneering are 'co-mingling funds', where money from different sources is pooled together. Co-mingling funds can be structured so that more commercially sensitive investors receive an investment return which enables them to invest into the fund, but which still invests on terms that are affordable for social ventures. This is because investors with different motivations, such as the government or charitable foundations, are willing to accept lower rates of return or higher levels of risk on their investment than their commercial partners. Cabinet Office is currently supporting the development of a fund that will apply these concepts. The fund will create social impact by providing affordable investment capital for community arts organisations.
We also recently honoured and celebrated trailblazing social financiers at the first ever UK social investment awards.
In summary social investment is still new to most people and organisations but it has huge potential both to transform public services and to find new ways to make them sustainable.
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