Paying for outcomes delivers results
The shift to outcomes in government and philanthropic funding is already having a significant impact on the lives of people most in need. By measuring and paying for outcomes that benefit society and provide value for government and donors, we can ensure that resources go to what drives the greatest impact.
One innovative financing model to drive better outcomes are Impact Bonds - where socially motivated investors take on the financial risk of not achieving outcomes. This frees up delivery providers to focus on the implementation of the program and ensures that public and philanthropic funds only pay for what works.
There are now 160 programs in more than 30 countries, tackling issues such as education, maternal health, homelessness, youth unemployment and recidivism. Over the past few years, Impact Bonds have expanded to low-middle income countries. Some are already delivering tangible results, illustrating the impact that this approach can have in addressing some of the most difficult social issues.
New education outcomes initiatives
There are new education outcomes initiatives due to launch in 2019/ 2020 that will address employment skills, computing skills, and math matriculation for school leavers, as well as improving provision and standards of early childhood education in South America, the Middle East and Eastern Europe.
As one example, the World Bank recently approved a US $73.85 million Development Impact Bond to increase access to and improve the quality of early childhood education in Uzbekistan. The project anticipates that by the end of its completion in 2024, about 40% of children aged 3 to 7 will be enrolled in preschool educational facilities, and that more than 1 million children will be attending preschools equipped with improved learning environments.
For additional information on the effectiveness of outcomes funds, read this recent Education Development Trust paper, which highlights several of the above case studies.