Could Manitoba non-profits benefit from private backers?

The Pallister government is touting a private-public funding model as a possible way to finance socialprogramming that would relieverisk otherwise placed on Manitoba taxpayers but how havesocial impact bonds fared elsewhere?

Manitoba Families Minister Scott Fielding announced Tuesday the province is looking for ways to measure the efficacy of social programs it currently funds. To that end, Fielding said the government plans to hire aconsultant as it moves toward creating social impact bonds in Manitoba.

The bondsbring private investors to the table to help fund social programming runby not-for-profit community organizations. If targeted social outcomesare met down the line, the governmentpays investors back, plus interest. If the social programs fail to reach agreed-upongoals, investors get nothing.

Manitoba's healthcare, child welfare, justice and education systems have all been identified as areas suitable forsocial impact bonds, Fielding said.

Saskatchewan

Social impact bonds have been used farther afield since 2010 in theU.K., U.S., Australiaand more.

Premier Brad Wall introduced a social impact bond scheme in Saskatchewan in 2014, and one of the recipients was theSaskatoon Downtown Youth Centre, or Egadz.

The organization helps at-risk single mothers and their kidssome of whomare victims of domestic abuse get back on their feet beforeprovincial child welfare workers intervene.

What the social impact bonds did was keep the bureaucracy out of this program.- DonMeikle

"My investors are very successful people and what they want to see is change for the better," saidDon Meikle, executive director ofEgadz.

Two private investors and a local credit union invested $1 million into a home forsingle-mothers and their kidsrun byEgadz. The Wall government promised to pay back the investment on the condition that 17 of 22 of the mothers stayed with their children for six months after leaving the home.

Completion of that goal would net the Saskatchewan government roughly $1 million in savingsit would otherwise have spentputting the kids into the province's child welfare system.

Over the past two years, Meikle saysEgadzhas kept those 22 kids out of care, saving the government about $1.5 million.

"What the social impact bonds did was keep the bureaucracy out of this program," he said."We just found we need to get the moms and the children at time of crisis and not just let it spiral, so it's been very, very successful for us."

'Pay-for-performance'

The Ontario government recently began exploring "pay-for-performance" social impact bondsfor four not-for-profit programs.

Priority areas identified by the province included programs that focused on affordable housing, bolstering supports for at-risk youth and creating opportunities for people with disabilities and others facing barriers to employment.

A preliminary report cited cross-departmental collaboration within government and between community organizationsas a high point in the research and planning stages.

"Service delivery organizations were asked to think critically about the qualitative and quantitative benefits of their program, outline a clear outcome, and provide evidence for their proposed intervention," the 2016 report reads.

"Parties were pushed to evaluate data in a more holistic manner and to think creatively about how and where to access data sources."

But the report also states access to data on a variety of social outcomes was complex by nature and "many organizations found it challenging to develop a feasible [social impact bond] idea."

Communityorganizations that successfully net funding through a committed entrepreneur or corporationcould end up with"long, strong, stable funding," said KateKehler,executivedirector ofSocial Planning Council Winnipeg.

"That could be something they don't often get from the government, especially when always fearing a government change or simply their program becomes out of favour," Kehler said.

Reform, social change needed

At the same time, Kehler hopes the government is genuinely interested in reform in areas such aschild and family services and justice, as Fielding highlighted, and not simply looking to off-loadits financial responsibilities to community organizations.

"When we have two systemslike child and family services with an over-reliance on apprehension, and a justice system with an over-reliance on incarceration two of the most expensive and least effective answers to our social issues small community programs can only go so far," she said.

"The social change is what's necessary if we're going to make any progress on this."

Kehlersaid details from the province are vague at this stageand shewants to know what will happen to organizations that do manage to hit their financial targets a few years down the line.

Fielding said whatever experiments the provinceruns, social impact bonds won't be used as replacements to government funding for existing programs.