The conclusion of the world's first social impact bond (SIB) will return all of the investment as well as a one off payment described by Social Finance as "just over 3% interest per annum" over five years go to 17 social investors after outcomes were achieved. All of the investors were charities or charitable foundations. Peterborough social impact bond investors see 3% interest, Lee Mannion, 'Pioneers Post, 27 JulySocial Impact Bonds are the non-tradeable variant of Social Policy Bonds. I've had no direct involvement in any of the 89 SIBs in 19 countries which have now been issued. I'm ambivalent about SIBs and their non-tradeability - see here and here. But I think they can be helpful where the alternatives are neglect or poor policy. They might also serve as a handy stepping-stone to the full Social Policy Bond model. For current news about SIBs there is a database and relevant links, here.
Now, if those Italians whose towns have been turned into migrant holding stations had been allowed to debate the migration issue; if those living in Lampedusa and the other migrant destinations in Italy had been part of a process of democratic deliberation; and if they had been allowed to voice their concerns, and influence the decisions which have led to the influx of migrants, then perhaps the seething resentment, the sense of being imposed upon, of having their lives turned upside down with the stroke of pen in Brussels, might have been absent. Perhaps a more workable solution could even have been found. And perhaps the migrants themselves wouldn’t be treated as a problem, but as people just like us, sometimes fleeing wretched lives, always seeking better ones. The EU: pitting migrants against citizens, Tim Black, 'Spiked', 12 JulySadly for everybody involved, our so-called representatives at the national and EU levels have got into the habit of not consulting us about almost everything. The results are as dismal as they are predictable: the gap between citizens and politicians grows ever wider. Ordinary people feel - and are - powerless. Politics are hyper-polarised. Anger and violence are now a normal feature of political discourse.
Our politicians just know they're right. So do those NGOs and philanthropists who support 'open borders', for example, though, unlike the rest of us, they don't have to live with the consequences of their momentous decisions.
It's time to change the way policymaking works. Social Policy Bonds have two main elements: identifying society's social goals, and injecting market incentives into their achievement. If we could strive for the first of these elements alone, that would be preferable to our current system. As it is, few ordinary people are consulted on issues, such as immigration, and our political class is now so removed from everyday life that they no longer have any feeling for what's important to us.
Social Policy Bonds could narrow the gap between politicians and the people they are supposed to represent. Political debate under a bond regime would focus on outcomes that are meaningful to ordinary people; things like physical and mental health, crime and housing. Because such concerns are meaningful to all of us, we could all contribute to discussion about which goals we should target, and their relative priority. Of course, none of us will be fully satisfied by our collective decision. But, crucially, we shall know that we have been consulted and that, if we wanted to, we could have contributed to the debate.
One happy result of that is that there would be widespread buy-in. We might not fully agree with every decision, but we were able to participate in the process, and we now have a fuller understanding of the trade-offs inherent in any political decision.
I've written more about Social Policy Bonds and buy-in on my main website here, and in various blog posts including, recently, here, here and here.