1. Big Lottery Fund Learning from Social Impact Bonds and other outcomes based interventions Phil Messere Funding Manager Big Lottery fund

2. Big Lottery Fund and SIBs
2010 – Peterborough: £4.4m co-commissioner
£5m SIB feasibility contract for 6 SIBs
2011 – £2.8m Next Steps: feasibility 3 SIBs
£40m CBO fund:
2015 – first CBO backed SIB Launched – W2W
2016 – delivering £80m Life Chances Fund
2017 – 12 CBO SIBs Launched;
2017 – 190 projects being considered in LCF
2017 – supporting DfE SIB Innovation Pilot

3. Why a SIB? They support people
SIBs are helping to -
Reduce demands on:
Health – diabetes, dementia, social prescription, end of life
Homelessness
Older people’s services – social isolation
Mental health and disability employment
Victim support
Prevent:
Costs of loneliness and social care referrals
Unemployment and related wellbeing/crime issues

4. Why might you be interested in a SIB?
Cashable savings
Costs avoided
Community benefit
Service user wellbeing
Better data to scale or replicate outcomes models
Research for more effective interventions

5. Cost of Present Interventions
Why a SIB? Financials
More effective interventions to support people
Savings for commissioners
Public Sector Saving
Cost of Present Interventions
Savings retained by Commissioner.
Impact of SIB
Investor return and other performance payments
Cost of new SIB Interventions
Net Cost to Commissioner
Status Quo
SIB
Cost Saving

6. Why a Fund supported SIB?
LCF/CBO subsidises commissioners further
SIB de-risks support local providers
Cashable
Savings
Saving including CBO/LCF top up
Investor return and other performance payments
Commissioner Outcomes Payments
Net Cost to Commissioner
Savings
Net Cost
Outcomes
Payments

7. What is a SIB? Contractual arrangement
Financial structure for investment
Transfers financial risk to Investors
Defers intervention and other costs
Supports early stage prevention
‘Precise’ tool to measure service impact
Data analysis to inform future strategy

8. Ways to Wellness SIB Commissioner: Newcastle Gateshead CCG
SIB Management: Ways to Wellness (WtW)
SIB aims:
reducing costs of patients with long term health conditions
improving well-being in deprived areas
People to be asked to take part: 11,300
People to engage: 8,000 plus

9. WtW Financials Commissioner Savings: £8.76m Other savings: £10.7m
Commissioner Outcomes payments: £6.5m
CBO outcomes payments: £2m
Central government outcomes payments: £1m
SIB start up investment: £1.65m Bridges Ventures
SIB cost to deliver: £3.93m

10. WtW process and success to date
VONNE, a charity, developed the idea
VONNE set up WtW as investment vehicle
WtW - £150K from CBO for feasibility work
CCG commissioned WtW to manage SIB
4/15 - SIB launched
results in year one:
97% of expected referrals completed
95% of patients expected recruited
Good early feedback from patients and GPs
Too early to say if cost savings will be realised.
2017 – further progress year 2 – awaiting results

11. WtW Learning Need to calculate potential attrition carefully
Multi-providers helps secure continuity of service
Different GPs and other hubs will engage differently
Improved wellbeing does not always mean saving
People supported really pleased to be engaged – “best thing since sliced bread” feedback
Strong steering group to drive project forward
Continually review risk/reward balance

12. Learning – why a SIB? Key general issues are:
Other options – is it better than fee for service?
What is similar to past practice – low risk?
What is new and not tested – higher risk?
How to incentivise service users to participate?
Links/fit with other initiatives and existing services?
What is benefit to commissioner – is it saleable?

13. Learning from Feasibility Work
(feedback from 72 SIB feasibility studies)
Value for money - maximise impact
Commissioners have most expertise needed
Skills audit before engaging consultants
VCSEs - multiple roles
Feasibility funding most useful in key areas
Commissioners make sure their agenda first
Shared learning and strong evaluation
Service user engagement - often overlooked

14. Learning - Top up Payments
If commissioner does not lead, SIB structures can get complicated and overheads can cost more
Strong rationales for savings, metrics, outcomes so engage with commissioner finance teams early
Investor returns needs to match risk transfer
Only pay performance bonuses to reward extra risk
Controls can de-risk investor at provider expense
Management overhead needs to be managed – 5%
22 months from concept to SIB launch

15. Learning Financials and Metrics
Incentivise all parties to maximise success
Look for social (and learning) impact first
Clear outcomes and strong data
Independent data verification
Manage perverse incentives, attribution, creaming
Check realism of interventions and savings
Plan realistic intervention costs
Plan proportionate overhead costs

16. Learning: Project Management
Get skilled commissioner people on board
Retain experts
Project manage
In-house or procured management for VfM
Regular data analysis review
Empower project board to effect rapid change
Manage conflicts, risk transfer and procurement
Ensure continued stakeholder engagement
Disseminate learning to scale/replicate SIBs
Make sure proposal timeline is manageable

17. Opportunities for Commissioners
LCF is closed but:
Projects want stronger commissioner engagement
c100 LCF SIBs will be in development end 2017
LCF Adult Services - Drugs, alcohol, health, older people
£1m plus LCF outcomes payments to help commission
DCLG, DoH, DWP and OCS developing SIB Progs.

18. Further Information