An invitation from our incoming Deputy Director and Head of Commissioning Support, Nigel Ball

In the spring of 2013, I attended a conference on social enterprise at the University of Northampton. I had just returned to the UK from a long stint abroad and was aiming to get up to speed with developments in my sector as fast as possible. Amongst the many sessions I attended at the conference, one in particular stuck in my mind, about the world’s first Social Impact Bond at Peterborough prison. It was being so talked-about that even on the other side of the world I’d heard of it – but it was at this conference that I first understood how it worked and what it was trying to do. A seed had been sown.

Working on education and social enterprise projects in East Africa, I had come to favour market-based solutions to social problems. There, governments were typically doing a lousy job of providing basic public services, and while large aid agencies were sometimes filling the gaps, they undermined what local structures there were. I wasn’t naive enough to think that SIBs were any sort of an answer to any of these problems, but I perceived one benefit which I thought might be helpful: the opportunity to align social and financial value creation.

Now that I have set up a SIB myself with West London Zone, I am not sure that alignment of social and financial value is the main benefit of SIBs, or indeed whether it is always a laudable aim at all. I have, however, seen other benefits flow from the commissioning and payment structures that underpin a SIB. The GO Lab has devised a way to summarise these benefits under the headings of innovation, collaboration and prevention, which you will be able to read more about soon when we publish a summary of the team’s phenomenally comprehensive review over the summer of 54 documents related to existing SIB projects. I would argue that the West London Zone SIB has features of all three, as below (and as I explain in more detail in my blog on the West London Zone website):

• Innovation: Local Authorities have been able to transfer some of the risk of trying something new – be it a promising intervention or the ability to give providers more flexibility in delivery – onto specialist social investors.
  
• Collaboration: multiple local sources of funding for extra support for children – from Local Authorities, local schools, and local philanthropy – have leveraged one another to back a partnership of local charities to deliver a range of specialist support, tailored to individual children and co-ordinated by Link Workers on the ground.
  
• Prevention: by identifying a tightly-defined group of children using a range of predictive indicators of risk, and bringing to bear all the local resources that can be mustered to help them, fewer children might need support from the state in later youth and adulthood.
  

I believe that given the current economic circumstances and growing pressure on public services, not just in the UK but elsewhere, there needs to be much more innovation, collaboration and prevention in the delivery of public services – particularly around the toughest social issues. This doesn’t mean we need to set up SIBs everywhere, but it does invite us to examine whether the structures that underpin public service delivery are creating the right incentives for decision-makers and delivery organisation do these three things.

Outcomes-based commissioning, a broad set of practices which includes SIBs, could help. It invites those who organise and deliver public services to specify the desired outcomes for individual citizens or groups of citizens, rather than specifying the service to be provided. It is a radically different frame of thought for decision-makers, and there is a hypothesis that thinking in this way can enable more innovation, collaboration and prevention. The problem is, we don’t have very much evidence on whether it does this, let alone whether it leads to better outcomes.

That doesn’t mean our efforts have to stop. New approaches take time to be proven one way or the other. We should keep trying them out, and seek to build up a base of learning as we do so. And that is the GO Lab’s mission: to help commissioners to do more outcomes-based commissioning, and to help build up the evidence base around it.

We should also keep debating. The problems we are trying to tackle through outcomes-based commissioning, and indeed through many other policy approaches old and new, are too important to stay quiet about. But we must take care not to throw the baby out with the bathwater. Rather than asking each other to believe either that outcomes-based commissioning and SIBs are always the answer, or that they never are, let’s instead allow ourselves to discern when they have been done well and when they have been done badly. Then we will keep open the opportunity to do things even better.

The GO Lab is an impressive team made up of a mix of the foremost academic researchers in this area, and practitioners like me who have direct experience, which I am honoured to be joining as Deputy Director and Head of Commissioning Support. We would like to hear from you on three counts. Please contact us if:

• you are a commissioner doing something new in outcome-based commissioning, and think we should know about it, shout about it, or research it;
  
• you are a commissioner who has a tricky problem in your commissioning or delivery of a particular service and think we might have ideas on a new approach;
  
• you an advisor, investor, provider, academic, policy person, journalist, or other interested party, in the UK or abroad, and you have insights to share with us or contributions to the debate.
  

I look forward to hearing from you in the coming weeks and months!

Nigel is the Deputy Director and Head of Commissioning Support at the GO Lab. He leads the work of engaging government commissioners and other practitioners in the research and best practice generated by the GO Lab team.