Transcript for:
Outcomes Based Contracting (4th Session)

me um I'm shamia Ali I'm the development director here at healthy brains Global initiative this welcome to the fourth session in our series introducing outcomes based Contracting today's session we're going to chat look through sort of working capital and understanding the the need for working capital and how you can address that given that on an outcomes based contract you're not receiving payment possibly too much further down the line when when the deliverables are starting to be achieved so how do you how do you plug that Gap the need for cash the need for Capital so that you can start mobilizing and delivering the program as ever you will hear from Richard Johnson our CEO Richard has what nearly 25 years plus years something like that Richard in the field of outcomes and outcomes based Contracting so a wealth of exper expertise and experience in this reg uh in this sector Richard will talk through the various options and the advantages and disadvantage as well as giving you a bit bit of a background and context to outcom spased contracts his um presentation actually nicely feeds into impact bonds which is where Amit sha comes in Amit it's so wonderful to have you join us um we always try and have these sessions deliver them with with a partner and so it's great honor to have Amit sh from Bridges here on the call with us Amit is an in one of the investment director there and similarly I mean you have wealth of experience on AC based Contracting from your past experience at Social Finance but also currently with Bridges and bridges are involved in a number of impact bonds which um Amit will talk about in in his presentation which will cover broadly speaking sort of the investors perspective and Amit I hope it's I hope I can ask you that when you do your presentation if you could also give a bit more of a background to yourself um I know you will give a background to bridg etics in the presentation but I'd love to hear a little bit more about you and I think you will do more Justice with that than than I could ever do um so that's great um I will also just introduce you to a couple of other colleagues from hbgi on this call Anna Anna's got her camera on Anna is new and this is Anna's first um session with us in terms of the the series and outcomes based contract Anna is our our new Chief of Staff lovely to have Anna on board and I hope you find it helpful and useful this session thank you hello everyone it's great to meet you great and then Rachel is driving our slide Rachel as ever thank you so much um as this is the fourth session we've had three other uh sessions I'm not going to give an overview of healthy brains Global initiative I think most of you are familiar with who we are um I will put our the link to our website on the chat you can have a look at that advanced warning we apologize for the slight state of our website we're actually going through a refresh now so it will look even more Jaan dynamic in a few weeks the previous three sessions which was a a further introduction to outcomes based contracts the recording and the presentations from those are also on our website again I'll put the link on on the chat a little bit later so you won't have missed out on those sessions if you weren't able to join us live and then I will just finish off with a bit of housekeeping you will notice that we are recording the session please if you can just to avoid background noise please do stay on mute we absolutely want to hear from you we have built-in um sessions time after Richard's and amit's presentation for questions and comments but in the meantime please do type away in the chat we will be monitoring them we will answer and respond to them uh bizar Richard also somehow manages to Monitor and answer those um comments in the chat even though he's doing a presentation which is Al always quite impressive I guess the message there is we will be reviewing those comments so please do do feel way to type um we do want to hear from you I think there's nothing more from me as part of Welcome um Richard pleasure to hand over to you to get us started thank you Shia um and thank you everybody for taking the time to join today I hope you're going to find it interesting I'm absolutely delighted that we have Amit here with us from Bridges um one of the leading social investors in this space uh with with years and years of experience of outcomes based Contracting so it will be great to hear from them and we really wanted you to get this perspective from the investor side of their understanding of these Contracting models um and and and he will take you through that um my usual disclaimer I'm going to give you a little bit of a a recap on outcomes Contracting why we like outcomes Contracting um what we think are the components that make it work and a little bit about the cash Gap question which leads us on to amit's session um I am not an academic this is not based on Research that I have published this is based on experience of setting up running managing being involved in operations over the years um and it's on the basis of those observations that um that I offer you uh that I that I offer you these suggestions around outcomes Contracting and and hopefully some interesting thoughts for you to take away um up until the Taliban took over Afghanistan again for about four years I was in the country for roughly a week every month working with a couple of teams one on labor migration and youth unemployment and one on shifting basic and Essential Health Services to performance-based contracts whilst we were there uh an independent review was undertaken of a women's e economic empowerment program this program was being funded by usaid and the total value of the contract was $100 million the evaluation was done 2third of the way through their delivery um and it identified the fact that $60 million had been spent big tick they spent two-thirds of their money roughly two3 the way through the evaluation also reported that this program women's economic empowerment had managed to assist 12 women to secure employment 12 at a cost of 60 million this wasn't particularly questioned as a lack of performance because success wasn't necessarily measured in those terms but it's one of the most Stark examples that I've come across of how grant-based programs contracts which are inadequately performance managed and which don't focus and center the elves on some definition of success which is Meaningful to their participants are very are very much failing are part of a broken system can I have the next slide please so this is typically how the World Bank the global fund and others would pay for something like a training program we've got our experts sitting within the donor the lender um they maybe contract that expertise out but there we sit remotely in London or in DC or in Geneva and we decide what should be delivered we prescribe the program and we agree what we're going to pay for those inputs possibly on some sort of competitive basis quite rightly the bank or the global fund won't then go and Implement themselves but they have an implementing partner within the country as far as possible it would be the government the government then goes out and hires the trainers sets up the venues runs the training training is delivered and receipts are gathered for the expenditure and on the basis of those receipts the government partner is effectively reimbursed and for the global fund they'll have a locally based local fund agent who goes through each of those receipts one by one and there'll be hundreds thousands of of receipts for every little part of the program there may be some monitoring and evaluation alongside that but it is likely that the monitoring and evaluation will feed into some sort of that happens after the training has happened and it's precisely that structure of funding that structure of remote prescription that focus on reimbursing costs which leads the sort of failure that I just described in that women's economic empowerment program next slide please one day whilst I was in Afghanistan uh I went into a meeting room um the the previous meeting at ended and they left leaving behind on the table a report which I picked up and read with some interest it was um from the people responsible for road building in the country and it detailed the money that they had spent building their roads and where those roads had been built and in a a number of cases a large number of cases Road had been built tarmac or whatever it was there had been laid but these roads did not link anywhere with any anywhere there were simply miles of Road built in the middle of nowhere not connecting any town with any town the road had been built they'd spent their money they had I suppose met those measures of success such as they were but that road had had achieved no meaningful function can I have the next slide please so I think we think at at hbgi um that in order to try and minimize that sort of waste in order to try and and challenge that sort of underperformance you need as far as possible to connect your payments to delivery ideally to the outcomes that that delivery achieves we need to agree what the outcomes are that we're looking for agree what we're willing to pay for them and then leave the service provision to innovate to flex to design itself around the service users to maximize the number of those outcomes that they achieve next slide please I've talked about this before um in these sessions um but just quickly to recap uh it was at the World Bank that I first came across the results chain I suppose it's not far away from a a theory of change and it's fairly straightforward in that in in the delivery of a program you've got inputs outputs outcomes and impact and along the bottom here there you've got the example of uh a training program in an employment context where your training being delivered would be your input if you complete that training achieve your qualification there's your output the outcome that we're looking for is someone securing a job and sustaining that job with an impact of reduced unemployment increased economic Prosperity whatever it might be and as far as possible we will look to attach our money to that outcome as far as possible that's what we'll look to pay for can I have the next slide please attaching the money to the outcomes in this way most closely aligns the incentives and Contracting is a lot about incentives we want to align the incentives of the commissioner the Contracting body with the incentives of the service provider and quite crucially with the incentives with the needs of the service user one of the things that has struck me most strongly over the last 25 years is that when within the program we start to talk about outcomes or more generally about performance we start to see a shift in the culture within that Service delivery when people start to talk about how do we deliver more performance what do we do to keep doing more of this to keep achieving more of these outcomes they start to to look at the way they're delivering the way they're thinking in a completely different way it might sound a little bit woly but the culture of the service completely changes if you get the contract design right this is not just about quantity this is not just about as many outcomes as possible if you define the outcome correctly it's about quality as well I don't just want to get people into rubbish jobs I want to get people into jobs that earn a certain salary that meet certain minimum standards I want to get people into those jobs from communities that are currently excluded from those jobs that are that are supposedly hard to reach or hard to help the outcomes then that I'm achieving are of of genuine quality as well I can run a training program for 50,000 people at $50 ahead and it looks really cheap great value for money but if only 50 of that 50,000 then go on to get jobs or 12 as we saw in that Afghanistan example it's appalling value for money value for money is when we achieve the maximum possible outcomes that we can for the people who are accessing that program it's potentially an attractive model for the commissioner for the Contracting body because they'll pass the risk of underperformance onto the service provider or whoever is funding that service provider in that first example that we looked at where the World Bank or the global fund is is paying for all of the inputs when they're paying for that training program for the 50,000 people if the training fails they still have to carry the cost volume risk is is a key part of of of these operations in terms of ensuring that you've got enough people to get onto the program and I want to incentivize my service provider to reach deep into those excluded communities this is a particularly powerful model when we start to look at populations that are currently un underserved such as within uh TB testing or or immunizations the populations that our programs currently don't reach we could incentivize service providers to reach them through through attaching payments to the outcomes within those populations there's great fatigue across the people funding these programs right now if we show them the actual results if we show them that we're not getting 12 people into jobs but 1,200 people into jobs and we show them the life experiences that we change that surely can address some of that fatigue and and and attract the funding towards us I suppose in order to manage these programs effectively you have got to manage them transparently you you generate a lot of live data to understand what's going on this month in my program in order to achieve my outcomes next month or three months down the line and it's vital that that transparency continues and is is is basically made publicly available um there was a change of government in the UK in 2012 uh the coalition government came in and they recontra all of their employment programs the minister of employment at the time the new minister of employment forbad the department of work and pensions from publishing any further data on the performance of the service providers of those contracts this makes it impossible to hold those service providers to account it removes your opportunity to use competition between them to drive up their performance it removes your ability to actually understand what things cost and and where to invest more of your money and it means it's impossible for you to identify best practice what's working in order to share that learning across your system design your outcomes contract right and what and this is possibly the most important of these for me what it really drives is a service that focuses on the individual service user uh in order to achieve the outcome for this individual I have got to understand that individual's life experience that individual's context I cannot make assumptions about the location in which they live or the the geography the class they come from the the the the social group they're part of whatever it is I have to try and understand the experience of that individual in order to achieve that outcome which makes this a genuinely localized program and something that enables us to develop things which are properly bottom up and properly cognizant of local uh local context local culture flexing and innovating around that individual and I've talked already about having Rich data in order to enable this performance next one please Rachel I want to ideally I said attach my payments to that outcome that's my sweet spot but I I'm really looking to attach it to something that is is not too far down this results chain in some cases we see people try and attach it to the impact and Village Enterprise who were one of our previous Partners on one of these calls uh described a program which did that and and produced really powerful results I think that's too far away from delivery part of the purpose of the payment model the payment schedule is to drive the behavior of the people within the delivery and if you attach payments too far away from that Frontline service you you use that ability to drive that behavior so not too far down the results chain it's got to be something that that I can count ideally something that is relevant that's got some sort of face validity it I I can see its relevance and it's relevant actually to the people on the program meaningful to the service beneficiary I need to be able to count it and I need to be able to verify it not necessarily all of it but I need to be able to go in and test a sample of it to see if it's actually been delivered because I'm paying for it after all and this whole thing has got to be costed in some way I've got to understand what this program costs so that as I as a Contracting body can arrive at a payment model which is actually going to work and incentivize and drive the right level of performance and so that the service provider understands what resources they need and what cash they're going to need up front and we'll come to that in a minute and then of course the program starts can I have the next slide please some examples here and I'm not going to go through all of them you've got access to to this slide deck afterwards but one of the questions that we always ask it is so what are the outcomes what are you going to pay for here's a whole bunch of different examples many of them have already been used people going into work homeless people securing accommodation people leaving prison are not reoffending these have already been used as payment Triggers on on outcomes contracts some of them have not yet been used such as a reduction in stunting I think that would be a great opportunity to to attach the payment to the performance to the outcome to really Drive something that is is localized and and and takes account of of where that program is being delivered um number 12 is an interesting one um sham and I did some work at the global fund with another colleague of ours now director of technical assistance at at hbgi on Shifting the payments that were made uh by the global fund to actually pay when a mosquito net was hanging over a bed up until that point they'd reimbursed the money for hiring lorries for transporting the Nets from here to here from counting all of the houses from doing a whole bunch of stuff that was necessary but because the payments were attached to it they took over and a lot of fraud crept in as well by attaching the payments to the mosquito net hanging over the bed we were able significantly to reduce the cost of delivery of those mosquito Nets the efficiency in which they were delivered we drove fraud out of the system and significantly reduced the time it took to get the net from the depot to that house uh there's a sort of odd person out here which is number eight a reduction in the number of child pregnancies that's an odd one out because this is a sort of population percentage count so whereas all of the others are counting each individual outcome or each individual output possibly this would say across a population I'm reducing the number of child pregnancies by 10% it's not I have to say my favorite sort of measure I think it starts to to increase this distance from the contract from the payment to something that's that's more like an impact measure but a lot of Contracting um Contracting bodies are interested in this sort of thing number 16 is what we're looking at developing probably on a program right now in South Africa this is a pilot program being funded by anglo-american mining uh the service provider is called right to care or the service facilitator I might say is right to care the service provider itself is going to be the health clinic and the community organizations that sit around it when a mother brings a baby in for an immunization we're going to do a maternal mental health check of some sort and if there is a red flag around her well-being then she'll be connected with resources that we identify and build the capacity of in the community around that clinic really difficult to get at the outcome in this instance so we look for as meaningful activities as we can along that results chain to attach the payment two and we think about then potentially paying for each woman screened each person being referred take of that referral and then ultimately hopefully some sort of self-reported improvement in in her [Music] well-being comment from benw in um in the chat room um I think Ben W has a contract in which he's paid for percentage reductions like this though I appears to similarly share my concern in terms of the attribution the further you push down this line the of the results chain the more you are questioned on the extent to which your program actually is the cause of the impact that is being delivered the attribution there though to a certain extent I think that the people who research around this space and question the efficacy of the model um lose sight of the fact that we can spend 20 million and get 12 women into jobs or we can spend 60 million get 1,200 milon women jobs let's keep it simple and focus on actually those meaningful those meaningful outcomes that really make a difference to people's lives next slide please so you've got to get the contract right you've got to decide um what you're going to be paying for um and we Al and we really need to to base this on some sort of common definition of success we need to Define what it is that success looks like in this program what the meaningful outcome is what success is right for the individual on the program um and we've got to design our perfect outcomes contract and that is only part of the battle once the contract is in play it is vital that you then have proactive Performance Management wrapped around that delivery so that might look like on a monthly basis a performance review at which a performance pack is produced detailing within that past month everything that H has happened within that period of time so that you can question it challenge it test it and ask what are we going to do differently next month where are we going to invest our money next month in order to raise that performance in order to deliver more outcomes and we talked more about this in an earlier session on Performance Management in order for all of this to happen we've got to have the right level capacity within our Contracting body within our service provider but to be honest the best way to build that is for them to start on this journey and start Contracting in this way of of course there's a whole bunch of other components of success behind this such as having the right staff with the right levels of motivation having some good it in place to to collect the data but for me all of those really fall out of a good definition of what success looks like getting the payments right focusing this program on delivering as much performance as possible and then the provision is going to say if I've got to deliver that performance who are the people I need for it what skills have they got how do I how do I maintain them working at their best next please but we have this problem if we're going to attach our money to the outcome if we're going to pay the service provider when they get people into jobs and keep them in those jobs what about all of the stuff they do leading up to that what about they they've got to open an office they've got to employ some staff they've got to go into the community and engage with the unemployed people the people looking for work they may have to do some work with those individuals to uh create budgets for them when they go into jobs so they understand how they'll be better off in work they might have to do some personal development programs with them they might have to buy them clothes for interviews they might have to teach them how to to apply for jobs they might have to polish their CVS whatever it is there's a whole bunch of inputs and outputs ahead of that outcome where does the money come from to cover those costs next slide slide please number of ways you could address this and AD is going to talk a little bit further about these as well but the service provider could go and borrow it from a bank or or maybe they've got it sitting in their cash Reserve somewhere now in a lot of cases if they're an NGO if they're a community based not for profit they're not allowed to have big reserves maybe and they're certainly not allowed to risk those reserves in inputs and outputs ahead of payments for something that they're not necessarily sure about and going to a bank is going to is going to cost them extra money and maybe they're not allowed to do so perhaps this favors big private sector organizations and excludes some of our our smaller community- based organizations it's possible for the Contracting body the commissioner to bring some of the payments forward and sometimes these are called interim outcome payments but I could attach some of my payments to inputs and outputs in order to get cash out into the system thinking through that a little bit further and and this is this is what we did in Ethiopia with the World Bank on a refugees into jobs program that we were designing we brought money forward into a mobilization allowance so that when the contractor started they were given a bunch of money UPF front and then they effectively repaid it as they started to achieve their outcomes so for each outcome they were they were earning out some of that money they'd had in that allowance or you've got the option of potentially bringing in Social investors and this is sometimes called social or development impact bonds I don't think it has to be called that but that's generally what the model is called the next slide please so again iit's going to talk to you further about this but here generally is your structure of a social or development impact Bond the difference being in a social impact Bond the local government pay for the outcome in a development impact Bond it's some sort of development institution like the World Bank who pay for it so here the government goes we want to pay for jobs that's what we're going to attach the money to the service provider goes but I haven't got the working capital the cash to cover my costs ahead of those outcomes so a prime contractor or a social investor step in to provide the working capital maybe they select the service providers themselves they Prov provide that cash up front and then as the service provider delivers the outcomes that prime contractor or social investor claims the payments back from from the commissioner can we have the next slide please criticisms of this model that I will often hear are that it's incredibly complicated it's incredibly expensive to set these things up and there have been some horribly expensive examples of this it's all going to be about Quant and profit and money and quality is going to suffer the service users are suff are going to suffer and providers won't like this anyway because they don't want to do outcomes can I have the next slide please you think this is complicated I think this is incredibly simple what could be simpler than saying my measure of success is somebody getting a job or a homeless person securing and sustaining employment and that's what I'm going to pay for as opposed to sitting down with my experts to come up with a a a plan that we then prescribe with multiple inputs all of which we then have to price and pay for and audit and and and Chase and it's incredibly complicated and Incredibly expensive to do it in that way I'm really simplifying this and in so simplifying it freeing up my service provider as I say to to innovate to flex and to maximize that performance you should see the size of the world bank's procurement documentation that's complicated is it expensive to set up yes there have been some hideously expensive examples of this um partly because I think in a number of cases funders organizations for whatever reason decide oh I've heard about this really sexy thing called an impact Bond I want to have one of those and they employ a large consultancy to go around looking for some application where they can stick the impact Bond and then they design this thing around that application whether it really fits or not rather than starting at first base which is identifying having that problem statement of unemployment need to get people into jobs what's the best way to contract that best way is through paying for outcomes how do I now need to facilitate funding to address the cash Gap beware the Consultants beware the the noise around this it does not have to be complicated or expensive design it well design your target group carefully and quality is actually a consequence of the program it doesn't suffer at all because I have to reach that excluded population because my outcomes are outcomes that are genuinely life-changing for them they're not just sitting in a classroom for six months they're achieving a job which changes their life um and we went out to the market 18 months ago now and we 24 months ago now and we asked service providers are you interested in delivering outcomes contracts and we got 51 responses saying yes please in some cases we'd like help in understanding how we manage outcomes and we might want help in funding this but we want to deliver more for more people we don't actually like our hands being tied by grants it isn't a cure all this isn't right in all cases but this is where you start with the problem statement and look what it is you're trying to achieve and then you design the best contract fit for that purpose next slide please my last slide IIT then it's over to you so connect your money to the delivery connect it to the delivery the meaningful delivery as closely as you can you're going to mitigate waste you're going to maximize the chances of performance and meaningful performance you've got to understand what this costs you've got to build what I call a costed operating model you've got to understand the inputs that are going in and the expenditure associated with them and the outputs and the outcomes that you get out and what payments you might earn for those and the relationship between the two of them you've got to understand that and your commissioner's got to understand that partly so you understand what cash you need to run this program before your income comes in think about solutions that are bottom up that that really empower the service user one of my really big learnings of the last nine months you know I I've always thought outcomes are simple I can Define them for you and I I gave you 22 examples on that on that previous slide over the last nine months I have spent a lot of time in California looking at the services they have there for homeless people with severe mental illness meeting with the service providers meeting with people accessing those Services meeting with their families meeting with peers and it's become more and more evident to me that I'm the wrong person to Define all of those outcomes for those people accessing those services and that as far as possible we need to create a program in which the individuals themselves are able to say this is the outcome that I want and I need and we Empower and enable a service provider to help them to achieve that through the way we contract and pay that service provider we've then got to have Pro proactive Performance Management around this whether you're going to pay for outcomes or inputs you need to be performance managing you need to know who is delivering what where have a mechanism to keep driving the Improvement of that and be doing this transparently and openly all the time facilitating this question of where do I need to spend my money not how do I do this more cheaply because I want to cut my costs but where do I spend more in order to achieve more of those outcomes that's it from me that's my roller coaster ride through outcomes Contracting you may have heard an awful lot of it from me before Amit is going to take us through now more of a a detailed look at those impact bonds and the role that they have played in those and in social investment and outcomes more generally but shamsia did you want to pause for question or should we carry on yes please thank you Richard that was that was great um to hear the recap and then also the options um it would be if we can just see if there are any further comments uh besides what's been posted on chat if we can take five minutes um well please do raise your virtual hand if you'd like to ask a question um and whilst we wait for people to sort of raise their hand Richard um one comment we often hear about outcomes based contracts um is kind of the is it more expensive to do outcomes based contract but kind of just picking up on your point about where where can I spend to deliver more it's really not about the cost but how much how effective your spend is in the outcomes in the impact you're having and Amit is going to pick up on this point PR precisely and I think he has a slide on it but I I would I would go back to this example and this is a real example um from someone in an organization I won't name who told me but we ran this program and I think it was in Bangladesh for 50,00 th000 people it cost us $50 to train every one of them your program to get refugees into jobs in Ethiopia is going to cost $5,000 for each of those jobs that's incredibly expensive isn't it my program was $50 a person I'm sorry your program was $50 for a training program that delivered how many jobs oh we don't actually know how many jobs it delivered because they didn't even count that we need to make sure we're asking what outcomes are being achieved by people and what the value is of those outcomes that's the question to ask not how cheaply can I deliver something that may or may not make a difference to somebody but Amit we'll pick up on that I'm sure thank you and Amit let's let's move on I don't think there are any further questions or comments so Rachel please move us on a couple of slides over to you am sure no thank you Richard I mean it's a very hard act to follow and you've uh you've explained a lot of things really really clearly and more clearly than I ever can so uh so thanks for that um so um yeah as as Richard mentions I'm uh Amit I work for an organization called Bridges outcomes Partnerships um and we are people call us an investor technically we we we are definitely not an investor actually we are a fund manager we manage money on behalf of um of other investors and it's mainly um a lot of government funding so organizations like big Society capital um British International Investment um the development Finance Corporation of the us a lot of Foundations too like asme Fairburn and the UBS Optimus Foundation um support many of our funds I'll go through that in a little bit more detail detail later we manage money on their behalf specifically to support um the kind of work that Richard has been talking about so specifically to support delivery organizations um who are in this market for kind of outcomes Contracting so who are working with Commissioners to uh deliver on uh to deliver on on outcomes and our our main mechanism is exactly as Richard said often we'll take on that contract with the uh with the commissioner and then will then work with delivery organizations delivery Partners who are then delivering on the ground and what we kind of hope to bring to this is is our not only our funding but our expertise in kind of having done this now kind of 75 plus times across uh the UK and and Beyond um in terms of my my my personal background I um joined Bridges around four years ago um and I um specifically focus on our work outside of the UK and I I'll get into that a little bit more later um in low and middle- income countries um and um but brid brid's outcomes Partnerships itself has has has come from a history of working in the UK and we've recently focused on um working outside of the UK prior to that as as sham mentioned I worked for an organization called social Finance who have been um one of the Pioneers in um kind of driving this this method of Contracting um beyond the employment space the employment space it sort of existed a bit uh for a bit longer but but taking that that model of kind of results based financing into other areas um starting with Peterborough prisons and and moving beyond there um and uh prior to that my my background was mainly kind of banking and and and Consulting so um I've sort of come over to the Light Side uh more more recently in my career um if we can shift to the to the next slide please it was a nice a nice transition point of uh of of of shamir's comments on on the the cost Effectiveness and I think that's our starting point for for being involved in this space why why do we care about outcomes Contracting why do we care about this market and why do we care about this way of doing things our belief and our kind of um our driving mechanism is we believe that this way of working can really Drive significant um uh efficiency in spend and uh result in better outcomes for Less funding um so I think I thought I'd talk you through a couple of examples um so the first of this is a contract I know and love well I set this contract up whilst I was at Social finance and actually Managed IT on behalf of uh Bridges who were an investor uh um uh Who provided the work in capital to uh the delivery organizations in this contract it's it's called positive families partnership and it was delivering family therapy in um London and family therapy is a service whereby we look at families where the child is uh troubled and vulnerable for for for whatever reason and we try and work find ways to work with the family to try and keep that family unit together and rebuild that family unit so that that child can be supported within the family system and not taken out of the family system and placed in foster care which is a you know a common a common problem in in London and and Beyond um and was a growing problem at the time this contract was set up in in London and the Dynamics of this contract was that we um were we set it up so that the government in this case it was uh initially five local councils and and moved up to moved up to 10 by the end of the contract but Satan meron Tower hamlets Beckley and newm um were were um the founding uh contractors we basically agreed a contract with them whereby they would only pay for um the therapy after it was delivered and only if it actually kept the family together so for two years after the service was um was deled Ed we would monitor that family and if that child stayed with that family then the the the local Authority would make a payment to us um for that family staying together so so as Richard said it's a an output uh sorry an outcome um that the these these uh local authorities were very interested in that led to both better outcomes for that family and better better impact for that family there's there's lots of research about kind of family family units staying together and and and and the impact for families on on that happening but also for the government itself actually there's a significant cost saving uh for for family staying together because foster care can be incredibly expensive whilst in parallel um to our cont actually sorry just before our contract was was uh set up with the government which is the one on the right hand side there was also a grant funded delivery of of a very similar service a very similar family therapy service um and actually on a on a cost on a pure cost basis the one on the left would have looked significantly cheaper because alongside the family therapy we put in place some additional costs around Performance Management um and uh and and and some additional return that would have be needed to to pay back to our social investors um very very low return because our investors are mainly interested in in the social impact but but would have been additional cost to the grant funded delivery which had been on the right hand side but what what you can see here is what the cost is per per family and and so although the cost the overall cost may look more when you compare the cost you know compare the cost of a therapeutic team actually the cost per family um was significantly cheaper in our delivery because we work with significantly more families per per therapeutic unit so the families per team per year in the grant funded delivery they worked with 24 families per year the capacity of a team is somewhere between 40 and 50 um so they were working at around half capacity because of the incentives we had and and and and the Dynamics of our contract we we we ensured that we pushed our our the our um therapy teams to work at very close to maximum capacity and at as you can see with a much higher quality score so the average quality score on the grant funed program was around three out of five and we got we got closer to four and a half um so both on quality and on cost um we managed to deliver a significantly better uh product for for kind of councils within London with a very very similar uh very very very similar service so that's why we're in this game which that's the thing we're trying to achieve you know we're looking at half the cost per family and a better quality service and we believe that this way of working and and the the things that that that we believe drive that are the things that Richard talked about so is that Performance Management looking at the service on an ongoing basis understanding that data and looking at that data and seeing what's working and what's not working and then when things are not working being able to make change and innovate and re distribute your spend to be able to to focus on things that drive delivery so for example some things that we did in this contract um we added in additional supervisor capability over the the service on the left so normally with these teams you would have one supervisor uh for for between six and eight therapists we actually put in place two two supervisors because we actually believed that additional supervision would support those therapists to deliver uh more effectively again on the right hand side we added a personalization fund so for families um you know who were in these quite challenging circumstances we allowed the therapists to do things like buy the kids uh a PlayStation or buy a table for the family so they could sit around the table and and and have dinner together once once a day um or buy a washing machine if that was a cause of friction in the family who was going to go and do the laundry etc etc etc so allowing um the service providers to Think Through actually what are the things that are really going to drive the outcomes that we're looking for here what are the things that is going to keep this family together that goes beyond um beyond the kind of core service that we're being asked to deliver if we can move over to the next page uh please one more example I want talk through this in too much detail because I think you've heard heard from Village Enterprise before so um uh Village Enterprise are an incredible organization we were we were fortunate enough to back some of their work that they were doing in East Africa through our foundation and um the the work that they do is to support women uh to graduate out of poverty so they support women effectively to create micro businesses um and then drive uh an increase in income through that through their work um you've you've heard from Village Enterprise before so I won't go through details of of the work we uh the work they do but in terms of the um outcomes based model under which they operated uh that saw 113% increase in per capita consumption for the the the um families that were supported by the outcomes based model at the same time they were running two non- outcomes based programs one in other geographies so not in Kenya and one in the same geography and actually the increas in per capita consumption there was significantly lower um around half of we'd achieved on the on the DI program um and that again was driven through things like um for example we um with the uh individuals from religion Enterprise that would go and support these women we actually bought in bought in iPads um and allowed them to show these women on the iPad how their business was performing in a much more interactive way than they were doing on the nonb programs that's been now carried carried through to those non-b programs um but it's it's allowing for those Innovations to happen um that we believe that kind of drives the value in in in in outcomes-based uh models be them SS dibs or or or other models um a couple of other examples just um just off the top of my head so in in Greater Manchester we've been supporting um um some homelessness work uh for a number of years and there we are operating um a service that supports um uh young young homeless people to find beds and and and stay in stay in accommodation um over over a long period of time and we we we've operated at a similar level of success to comparable programs but a cost base that's around 70% cheaper um than than other programs uh similarly in Northeast Lincolnshire um we have a social prescribing program social prescribing is a program where doctors can prescribe um effectively social activities rather than just uh medicines um and it's been popular in the the UK and the US and I think is now taking o take taking off in other parts of the world too um and there against the control group um we've seen a 35% reduction in um Hospital costs for um the the the the the the um group of people we've been working with on social prescribing um so across our programs we're starting to build up an Evidence base of how outcomes-based uh uh commissioning can really support um Commissioners how it can actually bring value to Commissioners and and that's that's um why we're in it and that's links I think a lot to a lot of the points that that Richard made earlier um in terms of what this means for Commissioners um so the Dynamics for for Commissioners who have been doing either grant-based or service-based um procurement for for all of time um it's it's a very different way of operating and and and and does require a bit of a change in mindset um for Commissioners um there's a there's there's a lot of reasons for this you know that often these organizations have a long history of doing uh working in the way they have often their procurement Frameworks and and and procurement methodologies aren't set up for outcomes based Contracting um and um it is a new way of of you know a new relationship Dynamic that you need with both organizations like us and delivery organizations too um so what that often means is that these things happen within uh existing Commissioners with a champion who want to do this who want to do something new so I don't know there's a there's a few commissions here I think from from from some of the names I recognize we we're looking at you to to help us drive uh more and more of this work within within commissioning organizations um but the truth is that that the reality to make this work is is the the strong relationship between commissioner delivery organization and an organization like us if we're providing funding um the aim here is to have a culture of kind of joint problem solving so you know if I look at some of our work if I take for example that GM program in in in Manchester one of the one of the issues that that really was stopping impact happening was as soon as we find homes for people um who were homeless um the justice system would come and uh find those people because they suddenly had a home and so then would be put into you know for for some petty crimes they had committed you know some shoplifting or something they would then be put thrown into the Justice uh kind of uh you know the washing machine of the justice system and um and that meant that all the good work that was done to find these people home and potentially stable a home and potentially stable employment were suddenly undone by the by the Dynamics of how the justice system worked so actually the commissioner there um greater Manchester um Authority helped us work with the um local Justice provision in in Manchester and said look if if the young people who are going through this service find a home and are finding a stable life you know don't don't push pull them through the justice system immediately allow them some time to settle allow them allow the service to work and if it is working can we sort of effectively not put them through the justice system in in in the usual way and allow these people then to build their lives um and and and you know find a way through to to to employment and and finding a home Etc that will give them a St a stable foundation for the rest of their lives um so it's things like that which which have really had a strong impact uh in in driving this the the social value the social outcomes um that that we all hope to see um the final point I think is the mindset is is different because because it's not about providing a grant for some specific delivery it's about commissioning the outcomes it's about letting go of the specifics how of how things are delivered and focusing on the strateg Strategic objectives that you have as a commissioner so it's about letting delivery organiz a and letting organizations like us work with those delivery organizations to deliver on the outcomes knowing that you'll only need to pay if those outcomes are actually delivered um and then working through your um internal uh dynamics of of contract management to allow for that space for for these contracts to deliver on outcomes and often in reality what we see with these contracts is that the outcomes delivery in the early days is a bit slower because we're learning about what's going on on the ground we're working with a service provider to really understand how that how the delivery is working today what are those challenges that that that delivery is facing um and then we're working with the with with service providers with delivery organizations to understand how do we how do we break those down how can we break through the challenges we're seeing how can we really push and and invest um on on Innovation to to allow us to kind of break those barriers down and and and really kind of supercharge the delivery of of outcomes next slide please thanks Rachel um so a little so now we've sort of talked a little bit about kind of Commissioners and the work that we do with Commissioners a little bit more about us um so Bridges outcomes Partnerships is um part of the wider Bridges fund management umbrella so Bridges fund management was uh set up around 20 years ago um through um a report that was done by the government uh the office for Civil Society at the time that there was a need for dedicated pools of capital to support um both uh parts of the UK that were um struggling with economic development and but also to drive or organizations that were going to have more social impact and through that we set um Bridges fund management was set up as a as a um commercially minded but impact first private Equity Funds are supporting businesses that were driving employment in parts of the UK where um econ Economic Development was slow but also to support organizations that were driving um significant um social value and social impact and um that work's been going on for 20 years and continues to be a a big part of the British fund management umbrella um and beyond that uh We've now branched out into kind of impact first uh private uh sorry real estate and and that's now one of our biggest uh pools of of capital um but around 15 years ago there was a there was a realization and again another report done by the office for civil society um to say that there was a need for some capital in the UK that supported engos and social Enterprises organizations that would perhaps not have a commercial um a commercial business model but could be could be their impact could be supercharged with access to the right kinds of capital um and the right kind of social loans Etc and um that's when the social the social entrepreneur pool of funding was set up within Bridges um initially funded by by the office for civil society in nme furn and Nester and a group of family offices and there we um supported um directly a group of NOS with loans um as well as made our first um uh supported our first outcomes projects um and it was there that we had a bit of a realization that kind of outcomes based Contracting was a really exciting model um to to Really deliver value with the funding that we were we had in our fingertips um so in that in the social entrepreneur po funding we actually supported 13 based outcomes projects um and after that we actually decided to launch dedicated pools of capital to support outcomes Partnerships um uh of the type that Richard described um and we've now dedic so we've now got two two pools of capital in the UK so the social impact bom pool of funding and the social outcomes initiative uh between them we've supported Now 60 contracts our investors there are mainly government uh organizations social impact minded foundations um and and a number of family offices but but all of our investors are really really focused on what's the social impact of our work um we are actually a not for-profit uh fund manager so we um we work on a not for-profit basis and um our returns back to most of our uh investors are you they're looking for very very low often uh Capital back in real terms um is the rate rate of term broadly that they're looking for um so in the UK we've been doing this work for about 15 years and more recently um uh about 5 years ago we started exploring doing this work outside of the UK so um we we have been constantly um asked to look at can we support outcomes based models outside of the UK we never had the Mandate or the capital to do that um we made our first uh kind of we stepped we sort of stuck our toe in the water with an investment through our foundation with Village Enterprises as I described before um and we also supported an uh an employment contract in in Palestine that Richard I think you were involved with uh with too um and and there was a realization actually that we could take the learnings that we've we've had of doing this in the UK to the international uh to the International Space to lower middle-income countries to development impact bonds um and so we co-designed a fund with the UBS Optimus Foundation um which is now called the sdg outcomes fund initiative um and which is Anchor anchored by British International Investment and DFC um so which are the the development Finance organizations of the UK and US respectively um that fund launched a couple of years ago and that's the that's the pool of capital that I'm most actively involved with so I'm looking at kind of supporting outcomes based Contracting in in lower middle income countries and I see um Beno on the call here um and he's one of the delivery organizations uh too that we've supported um through that fund already with a program in Kenya looking at um Sexual Health outcomes in um parts of Nairobi and and other parts of Kenya um and uh maybe at some point I can ask benoa to to unmute and talk a little bit about the the work that we've done together um but uh no it's uh it's uh it's been a really exciting development for us and and we've Now supported 11 different Partnerships uh that's gone up to 13 now uh in the fund uh and I can walk through some some examples if we can flip over to the next page please so in the UK the top line here is a few of the UK Partnerships we've worked on um and uh Stronger families together is the Family Therapy Program I mentioned in London we've actually rolled that out in in suffk and norol too um that's been a really exciting development that that we've seen the growth of of outcomes Contracting of of focusing on the same issue areas but in different regions um and that program is running and and and going strong in both suffk and norol um kirkle better outcomes Partnerships has become a very holistic uh model of delivering outcomes to different vulnerable groups in in Kirkley started off focusing on homelessness and employment is now actually changing to include victims of domestic abuse and and actually looking potentially beyond that as well it's becoming almost a place-based model of of supporting um a part of the UK um across a range of outcomes and kir have been very excited by uh working in an outcomes based model um and the last Model here oh sorry someone coming in you're good to carry on you're good to carry on Amit thank you okay um the last one the UK here is as I mentioned before social prescribing um uh where so we're working with the government uh the the uh sorry the NHS in northamptonshire um they have uh commissioned us to deliver a social prescribing service we've then worked with three delivery Partners to deliver that service which is um supporting people who have got long-term health conditions and rather than prescribe prescrib them just with medical prescriptions we're now prescribing them with different social activities Social Services um to help their long-term uh well-being and the outcomes actually that we're looking at is is as as Richard mentioned I think in some of the programs that H H gbi is looking at is um that mental that that kind of well-being and using well-being scores as a as a metric for um for Service delivery and that's been working incredibly effectively in northamptonshire and other parts of the UK where we're running that social prescribing service some examples from our low and middle-income Country work um so in West Africa um the um the uh Education Act comes fund has launched two programs one in Sierra Leone and one in Ghana focused on basic education so it's working with uh primary uh schools to improve the quality of Education outcomes being delivered and there the outcome metric is um um effectively student learning outcome so we are being measured against a control group of schools we're running a bunch of schools um and um we are being measured um to see if we can outperform those schools in standard tests in in s Leon and Ghana and we will get paid for um that out performance that we can deliver against that control group of scores um so that work is is really exciting and eof are launching a number of additional programs um focused on early childhood education one in s Leon and and one in Rwanda which are which are currently being um uh procured for and they're also looking at a program in Tunisia around um employment outcomes that that Richard had talked about uh we've been lucky enough to support a social Enterprise in Nigeria called recyclers who are a Plastics waste recycling organization um there we're working with an outcomes funer which is a a different one it was working with uni lver as an outcomes funer um and we were excited by that as a development in the market to have a kind of corporate paying for social outcomes um un have some um some Targets in there excuse me that they've stated quite publicly around the reduction in plastic waste in their um in their supply chain and recyclers is a big part of how they're kind of hoping to achieve this in in Nigeria and recycl effectively going out into um part of Lagos and and other parts of Nigeria and they've got a quite a unique model of collecting plastic waste um and we're supporting the kind of scale up and expansion of that and un are paying for two specific outcomes so they're paying for the plastic waste um that's being collected so the number of tons of plastic waste that's being collected but also for the number of jobs that we create that pay more than double the minimum wage in in Nigeria because often waste Pickers are quite badly treated uh in the market so we're trying to create uh and ensure that that that waste Pickers are are treated well and are um you know have healthy incomes um that that that enable them to kind of you know build their build their lives and and and and so so it's a it's a really exciting program um we're about a year into delivery um and and starting to see the first first of uh the the franchises that that recyclist create actually collect collect plastic waste so it's uh it's it's it's it's moving well uh and moving through um and the third of these is um an Employment Program very much like uh Richard described we are working with the Turkish government government in Istanbul um so working with the Istanbul Regional development agency and they have procured us to deliver on um employment outcomes so there's three actually triggers for payment here there is completion of a a training program an output based measure um finding jobs for for individuals who have then completed that training program and and then people sustaining those jobs for a period of of six months or more and the outcomes are heavily weighted towards those last two so the outcomes payments are heavily weighted towards those last two so very much focused on the outcomes um that program again launched last summer we're about we're about to see our first cohort of young people um complete the training hopefully in the next uh I think month or so and then what we'll be seeing hopefully some employment outcomes being achieved there um but it's a growing Market both in the UK and and and internationally and and we're excited to be able to support both now um and and uh yeah happy to talk through more detail about some of these examples if if they're useful in the Q&A [Music] we can move on to the next slide please I won't spend too long here because we've we've talk Richard talks a lot about kind of why uh working capital is needed and and the the Dynamics of outcomes Contracting is such that usually the outcomes happen after the service has been delivered so you are delivering today you've obviously got to pay those costs today but the outcomes payments will come you know six months a year to two years down uh down the line um and and so that that Gap needs to be bridged for for delivery organization and as Richard said often delivery organizations um you know some can just pick this up on their balance sheet but often that's not a possibility so then delivery organizations need to work through to Think Through how are we going to cover these costs and then how do we ensure those outcomes are being delivered because you know you can pay for the delivery today but if those outcomes are not being delivered um you will pay be paying for those costs and and and but that will be a you know significant hit on your uh on your balance sheet because you will not have those outcomes payments later to cover those costs if those outcomes are not being delivered um so part of what we do is work with delivery organizations to manage uh to manage that risk um so we will preuner organizations to be able to deliver on on on the social outcomes we will then work with those delivery organizations and I'll get to that a little bit more on my next page to to help them work through um the put in place the infrastructure that's needed to help um ensure that those social outcomes are going to get delivered um and then we will effectively take that risk away from delivery or organizations will ensure that they're funded and then if those outcomes are being achieved that's the funding that we will take to cover the working capital that we've put in at the the beginning um if we can flip to the next page I'll explain a little bit more about our work because although we we are providing that working capital our work goes kind of Beyond this and and and we see our existence as as um as as what's on this page um we want to work to make sure that outcomes based projects have that impact and are delivering that value for money that Effectiveness that I talked about in the earlier slides you know can we find projects that are delivering significantly lower cost per outcome and what do we do to do that so we work with delivery organizations basically to put in place the infrastructure to do everything on this page um so how do we find out what's working and what's not working and how do we do more of what's working how do we make sure that we have this iterative model to delivery so we're doing delivery we're coming back and looking at what we're delivering and then seeing what what's uh what what what's uh working in the data what's not what are we seeing in the stories um allowing us to invest in Innovation so can we invest in things up front can we do things like invest in that increased supervisor supervisory commission um sorry that increased supervisory capacity because we know that that's going to drive uh better outcomes in the long term can we put in place this this culture that I've talked about and the the best outcomes contracts have this where we see delivery organization ourselves and Commissioners working together to to figure out what is what is it in the system that's stopping outcomes from happening and do we need to do to overcome those things and the and and the last thing is you know we don't see our our impact as being kind of limited to one project so we're doing what we can to share the learnings that we've seen of what makes projects work what what make what makes projects tick both issues specific and and and sector specific and area specific but also the kind of infrastructure dynamics that that I've talked about that we believe kind of Drive um drive better outcomes delivery and actually to that last Point we've launched um a report last year called um people power Partnerships I can happy to Point people to it maybe I can put a link in the chat um once I've done done done speaking um which shares some of the kind of core learnings that we think drive better social outcomes uh in in the programs that we've done in the UK and we're working on a similar report on in the International Space our work there's a bit newer so so it'll be a little while before that's out but but we're certainly kind of interested in sharing the learnings that we've we've taken from our International work too if we can shift over to the next the next slide please um again we're not the only funding game in town so as as as as Richard mentioned um there's there's many ways to to fund these and and um you know different different outcomes contracts have seen different models um here this is just a subset of some of the things that you know there some of the most common things that we see um so delivery organizations you can fund this from your own balance sheet um if you have the capability it's easy and cheap you don't have any other organizations to work with so there's no due diligence required but obviously the impact fact of that is it means that you're taking on that risk um so you're taking on a the risk of of spending the um delivery cost up front and B that the the risk that those outcomes may or may not happen um often for kind of NOS for Charities that's not a risk that that they are able to take on it can be a challenge um and for for Commissioners actually the dynamic here is if if you if this is the only game in town if this is the only way of doing this you will get a very specific subset of delivery organizations who can bid um organizations that are large enough to take this risk on and have the capacity and willingness to take this risk on often that does preclude smaller delivery organizations organizations that are not for profit often from participating in outcomes based work similarly with borrowing from the bank the the benefits here are there are obviously lots and lots of banks out there most organizations have an existing relationship with a bank and and so actually may make that that due diligence process uh easy this obviously doesn't mitigate the Financial Risk because you have to pay that loan back uh um depending on where you are in the world the interest rates can vary quite significantly on bank loans and you your relationship with the bank Etc can can have some significant impact there so actually this could be a very expensive way to do this um and working with a bank there's often very very strict uh due diligent that's that needs to happen um also you may be asked to put collateral up against the against any loans you're getting to cover the risks here so um you know again could be an interesting option if you're a larger organization and and and have some strong relationships and and some strong credit relationships with banks but normally the organizations we work with fine this isn't really an option for them um outside of us there's a number of other social investors in the market in the UK there's organizations like big issue invest uh the social investment business um you know the benefits here their their kind of return requirements are are often concessionary lower the market rate and they're usually more Mission align than the borrowing from from Banks um there aren't many others out there that that I know of that have been actively focused on outcomes Contracting um So Others May May beg to differ but there's there's there's a few other kind of social impact investors focused on the International Space um um and all of them will require due diligence like we will um and in terms of working with you to ensure those outcomes are delivered and allowing you to kind of evolve your business model to to to drive those social outcomes different different organizations here will will have different levels of support so we are definitely kind of more on the end of providing that Operational Support of working with you to deliver the social outcomes of taking away the headache of managing the relationship with the um with the commissioner um and working with you then to deliver on those social outcomes um but different organizations will have a different kind of view on what that level of support looks like and the final is and this may be an option for some organizations actually to raise this money from donors or from foundations um which can be very low return sometimes even non-repayable um it's often not an easy thing to access it's uh it's um uh not a typical uh way of funding these things but there are some organizations that that have done it this way um and often that that Operational Support that I've talk talked about isn't isn't there um so there there's there's there's a there's a range of options here sometimes as as Richard mentions Commissioners can put this in place on themselves so that mobilization support um I've not seen it on many contracts Richard I think you may have seen it on more than I have um but we've seen that um as as another option too for delivery organizations to get funded we can shift to the next slide please so how how this works in terms of Contracting Dynamic with with delivery organizations so the way this normally works as Richard talked about with the social impact bond is that we will typically hold the contract with the commissioner um where we will say we will deliver on the outcomes that you are asking uh to to deliver will take the risk of those outcomes being delivered we will then work with usually find a service provider a delivery organization that we believe can can deliver on those outcomes and then we will work actively with that delivery or we will pre fund that organization and then we'll work actively with that delivery organization to be able to to deliver so the typical Dynamic actually is your relationship doesn't look too different from a grant contract with us so we will ensure that all your delivery partners are uh sorry every cost are covered and we will make sure that those um those costs are um uh you know that you don't have to take fin Financial Risk unless you really want to we do have a few cases where delivery organizations are interested in taking some some some of that Financial Risk and we can we can work to that um and then we will in part of that contract we will work with you so we will provide you with resource support infrastructure to work together to then deliver on the the the the metrics that we're being asked to deliver on by the contract by the commissioner and we will then support you to invest in delivery so we will not only enable you to kind of have the existing delivery cost but if things are needed if we need to pre-fund things that weren't in your budget today but we believe would lead to better outcomes and and more social value we can help do that so we can shift our our costs and shift our uh model of funding to kind of be able to pre-fund things to change that um cost base to actually fund things that we think are going to deliver better social outcomes and better social value so that's that's the that's the dynamic of of uh the kind of contracts that we would have with you um and ideally we'd see this very much as a partnership so working very closely together to look at the data to look at the stories coming out on the ground and then and work together to Think Through what are the Strategic changes that we want to make to Service delivery that we think are going to result in better social value better social outcomes if we can shift to the next slide please so in some of the underlying mechanics I've talked a bit about the contractual uh Rel relationship um as I say typically we'll hold the contract with the outcom funders uh with the Commissioners and we would then have a delivery agreement with you in some cases the delivery partner does hold the contract with the outcomes funder and then we provide a loan into that that organization that may or may not work for different delivery organizations as it obviously has some balance sheet implications uh for those organizations and we can work either way uh our preference is for the former so to have a so where we hold the contract because we think it makes it life easier for delivery organizations but happy to consider both um from a funding standpoint as I mentioned we will typically cover all your costs all your overheads and we will look to be flexible with that funding to be able to fund Innovation where we can um we don't want you to be taking Financial Risk unless you want to so we can typically cover the costs of delivery either in advance or in AAR depending on um the delivery organizations we're working with um in terms of the working relationship this is absolutely crucial to us um we want to work in Partnership we want to kind of look at the data improve the quality of data and use that data to to really kind of manage the service so what's important to us is not reporting it's not data for data's sake it's what data can we collect together that is going to allow us to make more informed decisions um you know in most cases we will allocate members of our team to do that Performance Management work that Richard talked about um who will work with you as a delivery organization and put in place those building blocks that infrastructure to to have that um that continuous mechanism to look at the quality of service that's being delivered and see where we can make improvements um and as what does that look like from a governor standpoint it's regular meetings usually monthly um to manage outcomes delivery um that's usually looking at you know what have we spent this month what's worked what hasn't worked what can we do differently um and can we kind of make a case for effectively a business case for spending on things that we think are going to deliver more outcomes um we would also have regular meetings with the outcomes funders alongside the delivery organization usually to to problem solve any issues any more structural issues um that are faced in delivering outcomes and see if there's ways we can work through those as well as obviously updating them on on the progress on on contracts next slide please so what do we look for when we're working with delivery Partners um the way we find delivery Partners can vary significantly um so sometimes we're procuring for delivery Partners sometimes we build a relationship with the delivery partner because they've reached out to us but we're looking for the same things regardless we're looking for some form of track record in delivery in the areas that we're talking about so some evidence that you can deliver outcomes um some evidence that you um have have have have been able to to to work in this space before and you have an understanding of what's needed um more importantly than that or or or kind of very very closely aligned to that is that you really do understand the challenges and that that that you see on the ground in terms of outcomes delivery and you've got some very good ideas of how that could be improved um you know the the best conversations I have with delivery organizations right at the beginning are organizations that say you know we've been wanting to do x y and Zed but we've not been able to do them because a contract hasn't allowed us to do so we believe that's what's really going to unlock value here that those kinds of conversations really get me excited that is usually happens when we have a team that really wants to solve the problems at hand um and has the skills and wants to wants to really solve uh you know is very passionate about the problem that they're trying to solve and linked to that is that that team has a really good grip on kind of the cost of delivery and managing the finances around the program you know we're not we're about financ financial management because we want to show the social value and the social value to us is usually a cost per outcome so because you know there's two Dynamics there there's are we delivering on the social outcomes but then what is what is the cost of each of the social outcomes being delivered and it's the the latter of those that that's really important to to to know in order to make sure we are delivering social value and so we are looking for teams that have a really really good grip and a really good understanding of kind of how they are delivering social value what are the things they're spending on that are working what are the things they spending on that are not um and how can they kind of reduce that cost per outcome link to that again is the data so um not only the data of their own delivery um but also data about the the broader Market in in the kind of issue area in which they're operating what is working what what what evidence do they have of of what is working in their own delivery what is not Etc and the last of these is is is you know kind of the working relationship here is really important so we're looking for teams that you know we really like we get on with we think we're going to work together well with um and teams that that that like us and would like to work with us would like to kind of have this slightly different way of working you know would like to kind of unlock the the outcomes um in the areas in which they work and and believe that this could be a good way of of doing that um so that that's a really really fundamental thing is you know we're going to be working together with you for three five maybe 10 years and we want to make sure that that working working relationship is is really strong from the off um next slide please that's the end of my presentation um so I hope that's been been useful and and has given you a bit of a flavor and insight of the kinds of things we do the kinds of things we we we look at the kinds of organizations we work with Etc um benoir I'd like to maybe invite you just to come in and maybe talk a little bit you you're one of the delivery organizations we have worked with over the last kind of year or so in the in Kenya in sexual health space um I don't know if you want to say a few words about um kind of working with us and and how you found it sorry to put you on the spot yeah a little bit hello a bit um I mean what what you say I think you you've said it all I think the relationship exactly the point that you're making is that the relationship is key um it's it's extremely different I find from a traditional donor to grantee relationship um it does feel we in the same vehicle one of us is the driver but the other the other one is pretty close to to the GPS and helping us um you know Drive the project efficiently um I know that in the I mean you didn't insist much much on the structuring and I think it is a little bit of a scary part because that's where the cost can can can come but in our case uh you you know Bridges was part of the success of the setup of the structure itself and at several stages um it could have gone wrong but again I think the both a very agile mindset you know solution thinking and uh and your understanding of the realities of an implementing partner like us uh were key I find great thanks thanks Ben always good to hear from you hello Shia thank you it's always a pleasure to hear from you am did you want to come in in response to Beno yeah happy to know I me we've been we've been we were fortunate to to work with too as as beno's organization is now called it's a fantastic organization and and um we bu build a very very strong relationship from the off when we met I can't remember when it was now Ben two or two or three years ago um and um what we liked about beno's organizations is that they were very Solutions focused they had some really good ideas they've been running this a similar service in Kenya for a while actually under an impact Bond structure um but even actually they had even more ideas to improve the service and and and you know think about what could be done beyond the work that they were doing already and that that was what got me really excited to work with them um and and uh and and drive that work work forward so it's no it's been a fantastic relationship uh we're in the early stages of the program not not even I think a year into delivery yet um and uh Ben was working quite closely with my colleague luia to um to see what we can do to to already extend the program both in in Kenya and Beyond so it's a it's a it's a really strong working relationship we've form with Ben one we hope it's a long and and prod one emit thank you so much catch your breath that that was a a really comprehensive um presentation we really enjoyed it thank you for the background to to Bridges and different way you work but also the real sort of going to the detail of the mechanism of of working with Bridges there have there are a number of comments I'd like to try and touch as many of them as we possibly can um and BR Richard that bring you back in to help answer some of this so um jonath you raised a a question around sort of investor and the title and then a couple of observation around why um adopting outcom based Contracting might seem more complicated than it needs to be um did you want to just come in Jonathan um I Know Rich and I both made an attempt to to answer your question around inest investor yeah sure happy to and I hope you can hear me okay um Sean say good to see you and a fellow goab fellow and I apologize I I dropped and then rejoined so I didn't see any comments or responses to the extent there were um on the investor point but um I I just appreciate both Richard and amit's overview very clear concise I've been follow I'm also I'm a lawyer at usaid but anything I say is obviously just my own personal views um but usaid has uh served as an outcome funder in at least three development impact bonds and just some general observations I just want to re highlight when we're talking about well how do we how do we um really scale more of these outcomes based funding approaches um I would I would just emphasize how much of this is potentially self-created problems where we're shooting ourselves in the foot starting first with terminology um investors using the terms of Finance really makes um little sense to me when it's a lot of U maybe more creative grant funding even if you don't call it grants you certainly I doubt can call it Equity um nor is it necessarily um uh debt financing and we can get into some of those mechanics later the other aspects are I mean development impact Bond social impact bond that is a distinction without a difference a material difference um and the term bond has always been incorrect yet here we go we continue to kind of perpetuate that um so it's small things like that make a big difference especially then when you're working in a large funding bureaucracy um in terms of getting a typical award out the door there are numerous offices involved um and so if you try to introduce some of these new terminologies um the and package it as kind of this new approach altogether as opposed to working within the existing funding structure saying hey let's start with your existing Grant uh rules and regulations and tweak them so that they can be supporting an impact Bond structure that goes a long much further away in terms of being effective than trying to pitch this as something brand new from the outside um which doesn't seem to really catch on um within a large funding bureaucracy so just some observations there but thanks so Jonathan um I agree with you to an extent in terms of um some of the wrong some of the terminology not being helpful here and bond is absolutely the wrong word um and I wish people would to a certain extent stop talking about impact bonds um just to note that they absolutely are investors so that generally the structure as far as I understand it is that actually the investors will typically create an entity for the Contracting and the management of this specific program so they will establish a special purpose vehicle an SPV that SPV signs the contract with the commissioner and selects and subcontracts with the service providers and the investors put money into that SPV which it users to pay for that provision and that money is a loan into the SPV which the investors will then look to take out so they very much are actually operating in that structure as as investors having said all of that and and going back to your point about doing within a grant funding structure so I I I'm afraid I absolutely disagree that we need to do it within a grant funding structure because I think the grant funding struct are broken but I I want because I Want to Do performance-based Contracting so I want to contract and pay for this program on the basis of its performance that's my starting point secondary to that is the question of if I'm paying for performance do I create a cash Gap at the beginning of the program of some sort if I create a cash Gap then there's ways for me to address it we've discussed some of them here I'm borrowing it I'm using my reserves there are going to be interim outcome payments the the commissioner is going to give me some money up front we'll address I've got to understand the cash Gap itself then there are ways to address it and at some point we might get to social investors who provide me with a loan but it's a means to an end for me and that end is paying for performance on the program as opposed to handing out a grant that is too often disconnected from that desired performance yeah just quickly in response I I think we're we're really saying agreeing on the same thing but talking about it differently so okay um 100% agree that this is all a means to an end um the other aspect though in terms of is it financing you know are using loans versus grant funding I think I think grants are getting a bad rep in terms of people are still stuck in this mindset that it is just merely a handout you give you know money and then you hope for the best that does that's that's basically not how grants um have to be designed even if that's how they traditionally have been designed so it's fundamentally about a design question you can still take grant funding or Grant capital and design it in a smart way that outcomes based Focus that drives performance that provides incentives um that it doesn't have to be done as a loan doesn't have to be done as a zero interest loan or even a forgivable loan um those kinds of instruments have implications financially legally and other kind of regulatory issues depending on how they're actually designed and so my point has always been you can do a lot of these structures um through tweaking of existing Grant instruments through the use of existing grants regulations and rules you don't have to actually go over into doing so-called Innovative Finance um by utilizing debt capital and certainly not Equity so I think there's just kind of fundamental misunderstanding as to what is Grant capital and what are so-called traditional grants and why can't we really just adapt existing Grant instruments to make them work so that it's driving outcomes not just paying for inputs and that is absolutely doable yeah no I mean I could I could sorry I mean you go ahead no no no go go ahead now Jonathan I think I couldn't I couldn't agree with you more and and I'd love to kind of have a conversation with you about this because this is exactly the kind of conversation I want to be having I think one thing that happened with social impact bonds is they sort of became sey um and so they became this thing that people wanted to do and they wanted to do a social impact Bond rather than focusing on why are we doing a social impact Bond exactly as you and Richard were both talking about the the the the financing and all of that stuff should be a means to an end and that the the end should be how can we bet deliver better value services with the funding that we have available and how can we improve the quality of what we're delivering with the funding we have available um and and the more we can move the market to to to think about it from that that persp perspective um you know cuz the other thing the other thing that Richard talks about you know that right at the beginning was that these things are costly and they're complex actually if they deliver much much more social value you can accept that additional cost and complexity if if it does exist um but you you can't do it if it doesn't but so so refocusing the mind and refocusing the attention on what are we trying to achieve and what we're all trying to achieve is better quality service delivery that's delivering better outcomes for less money um that that that's the key here but but you're absolutely right Jonathan I'd love to kind of maybe maybe knock heads with you at some point to to work through how we can kind of drive that language and and kind of have that uh yeah have that conversation in a way that's that's going to be kind of resonate with with different organizations um because I think you're you're absolutely right you know we we can a lot of this can be unlocking the existing spend that's happening but just doing it more efficiently and more effectively that's the way we should be positioning this this work just I just i' just be a little bit careful here and usid Jonathan I have never contracted the ocid so I I don't know the nature of your Contracting process but I have been involved with a number of global institutions and their Contracting and their procurement and to say that we can do it within those existing systems is potentially problematic because we have to first fundamentally challenge what they view as success within those systems and fundamentally within at least two of these organ ganizations they measure success in terms of what they call dispersement or absorption and in simple terms that means have we spent the money have I got the money out of the door and unless I've got the money out of the door I have failed I was actually informed on one project that I was working which was um which was heading to failure it should never start it was it was it was not going to work it was a Youth Employment Program in Pakistan and and the wrong government partner was government agency was partnering with it and I was told look Richard a bad project is better than no project because we'd be spending the money and that's that's I'm afraid the the thinking that has to be challenged because we've got to be asking I mean you described it there you know we we want to be saying we're all here to deliver better outcomes for more people well we need our our institutional systems to be geared up to be measuring to be delivering more outcomes for more people and measuring success in those terms not did I disperse or absorb the cash and I think I think there is some new Jonathan please go in coming oh no please thums up uh feel free to finish finish your thought no no we want to hear from you so go ahead and I'll come in if I need to thank you yeah that's um Sir Richard I think we we continue to agree uh more than perhaps you think um I I think what you're raising though is a separate issue and that's a matter of broader culture and how government views uh success and so I think my point Remains the instrument itself the funding itself the nature of funding there's nothing broken with that um there's nothing fundamentally wrong and so the problem I see with with impact bonds which I'm not a proponent or an opponent of again they're a tool at the end of the day um The Challenge what that does when you when you position it as something that is outside of the existing bureaucracy outside somehow of the rules and regulations of what government does um the it causes unnecessary confusion and it's basically saying well if we do it as an impact Bond structure that's better than your traditional grant funding instruments and so uh that causes uh confusion amongst our existing Contracting people are existing legal um and finance people to think is this entirely something new the reality is um at least in my experience when we provide outcome funding guess how that what guess what instrument that is it is a traditional Grant um and and we're basically framing it as oh but this is some kind of new uh impact Bond structure that is not true from the from the perspective of the nuts and bolts of how this actually gets funded so meeting the system where it's at I think is really important speaking the existing language doing that translation as to what do you mean by a so-called social investment versus how does that actually get implemented within an existing large funding bureaucracy to me that is the key for actually having the scale otherwise this is all just viewed as something from the outside trying to be forced on the inside um and and you're fighting a much larger uphill battle that way Jonathan thank you for flacking that I think that was a really interesting debate and I think we should certainly Parry on outside of this call as well um and I I agree I think we're tending to agree more than we're disagreeing and and Richard's point that this is about being clear about what how we measure success and as long as we are clear about how we measure success and that success is measured on the impact on the individual service users then rather than the Doner the funer getting money out of the door then it's about ensuring that there's good Performance Management excellent Performance Management Bill team to help the Implement of the service provider to achieve that success um and within that actually you can do it within the existing structure possibly as as you're saying um so I it feels like there is we are agreeing which is good to see um Ben Ben has his benw put his hand up just quick question for for you Richard and Amit in in your experience and reacting also Janan to to your comment do those mechanisms increase our ability our capacity to pull in multiple outcome payers under in one project and kind of one mechanism to aggregate multiple outcome outcome payers have you seen that in your experience it's our case it's our case in Kenya with you Amit we've got two payers that have that came to the party an agreed on outcomes yeah so so a social Finance I designed a number of outcomes contracts that had multiple outcomes payers and actually the reason it worked was because there's a specificity around outcomes price that that people could buy into and agree on um and and that was the that was the thing that became so actually the the positive families partnership program The Family Therapy Program in London actually was with five different local authorities uh each we had to go through the procurement process for each of them and and um and and then we more but but Amit in each case they're paying for the outcomes achieved within their local geography they're not combining they are they are contracts they are five separate contracts but they're under the same I mean they're they're identical as you know there's one contract that they all signed up to um so it was a single contract um in the by way you've got you've got you've got two organizations paying for the out the same outcome in the in the so so we so so the next example was going to be you was going to be kind of one of those which you know if I look through um you know even the the um the programs in seron and Ghana there's there's there's funding from FCD but there's also some some local government funding uh there as well in both cases so there's there's we're starting to see it more and more I think it was less common and we are starting to see more and more kind of multiple outcomes payers we're also looking at a contract in um in South Africa where there's a combination of a city um the national Treasury and the World Bank coming together to pay for homelessness outcomes in one of the cities in in South Africa um so that we are seeing more more and more of these kind of multi-outcome payer contracts and the Dynamics there are you'll you know there's a there's a there's there's a benefit and there's a leverage to each of the outcome funders funding you know if they're only putting in a third of the the total outcomes um that they're able to Leverage The the funding of the other organizations uh similarly in the UK West London zone is a program where there's funding from both the local Authority well the local Authority the schools um so the schools funding in the UK comes from a different part of funding um also some local philanthropists and some local corporates so there's a there's a you a very mixed outcomes funding pot there for um the outcomes contract that was there so there are you know there there's increasing numbers of examples it's still not I think common practice benoir but it's I think becoming more and more and more and more organizations are seeing that leverage happen we're also looking at a contract in cot deoir at the moment where specifically one of the outcomes funders have said they want to only match fund another outcomes funer um specifically for this leverage issue is they want to you know they want their they want want to see their money go further so um I think if we can get the narrative right we will see more and more of it and I think it can be valuable to outcomes funders to have other outcomes funders involved I think it's a really interesting question benir um and hearing Amit so you've got these examples of different funders bringing their money together in order to pay for those outcomes what what I immediately thought of which I have never seen and would love to see is the silos of public sector funding and delivery coming together to recognize that the outcome that they are achieving has an impact across those silos so that that individual's social Improvement in their wellbeing actually has an impact in terms of health and education and Justice and the local Authority and that they together then pull their resources to pay for that outcome because the impact comes back across those Sil and I've never come across an example like that yes or bring or come in just to pay for one of those additional outcomes if if the if the mechanism is pre-existing that's where it can start to become interesting yeah it would require these outcomes buyers Commissioners to look at the service from the service perspective service user perspective in a holistic way wouldn't it to see that actually a impact for them has many we are we're seeing a little bit bit of it in the in the nature based space actually so when we look at environmental outcomes um we're starting to see a mix of buyers of kind of carbon credits versus biodiversity Dynamics versus livelihoods and actually there's three potentially so in the project we're looking at there's three potentially different outcomes payers who are paying for each of those specific outcomes from a from a projects uh in in in a nature-based uh uh solution uh that we're that that we're looking is not not come to market yet so I can't can't say too much more yet but um uh uh so there there may be some pockets of that and maybe that might be an interesting kind of starting point where because it is a little bit more distinct and easier to separate I think in that in that World um but it might be a starting point to to you to give us some examples to point to agree with you Richard that we've definitely not seen examples like that and that that that is the dream of of of where we'd like to to take things thank you thank you so much um I think we've addressed the other comments in the chat also in the interest of time so um I'm just going to open up to the floor again raise your hands if you feel that any of the comments questions raised in the chat haven't been answered or you want to discuss in a little bit more detail otherwise I'll move us along um I do want to just bring it back to in terms of the theme oh Alexis please have I said the first name right no no it's right thank you hello um if if I'm not so just a question for amid thank you very much for your presentation if I'm not mistaken you mentioned mentioned that you were engaging some work with youra if I'm not mistaken uh Sor sorry Alexis with who youa so so the the reason I'm asking this is because I think one of the field where outcomes based Contracting can be really relevant as a sport and I was interested in in in hearing more of projects that you may have in the field yeah I don't think I said UEFA um if I did I apologize if if that's what you had um I can't remember what organization I think I think it was uni that I said maybe rather rather than rather than UA um we we I mean I think you're right there's there's some interesting ideas in sports and one of my colleagues actually was presenting at a UEFA event yesterday um uh so so there I think there there is some interesting things going on in the sports base it's not an area actually I've been involved with within as yet I don't know Richard or sh sham you may have seen some sports-based Dynamics in the kind of the the the mental health and wellbeing area um but it's not not something I've seen come to markets in at least across my desk as as yet it it is an outcomes fund that we at hbgi are looking at establishing one of our thematic out funds in collaboration with uh UNESCO had to get the right UN agency and their Fit for Life uh initiative um but we're in the very early stages of that and have been for a while talking to a number of potential donors and and supporters Alexi the French development agency are in the middle of procuring a consultancy to help them develop something outcome based around sport in a couple of um frankophone African countries I the countries to be determined I think great thank you very much for and I know goab were doing some stuff around Bol as well and had a conference in GL recently I did see Andrea on the call but I'm not sure if she's still there um but I'm sure Andrea can share the link to that great well thank you so much I I just I guess I wanted to come go back to one of Amit slides and something also Richard said you know in terms of linking it back to the theme of of this session which is understanding work in capital on outcomes base contract um and it as complicated as some of them might sound impact bonds sibs and dibs and and the various names they are one option of many options of kind of accessing capital on an outcomes based contract so they are one form of out outcomes based contract um thank you so much Richard and Amit once again for a really engaging um and and thought-provoking presentation it's been an absolute pure Amit having you um with us on this one and Richard you've seen us through four sessions now so thank you um for everything that you've you've contributed um for these workshops I've said the same thing four times shamia basically in different ways and through a different angle um but it's all been appreciated Richard thank you and a particular thanks to to the audience many of you have been with us uh from day one um we started these sessions um God about a year ago in response to the report that Richard mentioned in in his presentation this is the last one uh of the series um for now but we are very open to hearing your suggestions and comments a on on kind of General feedback on these sessions and how have you found them um um but B if there is anything that you would like us to cover in a future session please don't hesitate to reach out um my email address is all over the web I I'm getting spanned left right and center now um so I know that I'm easily foundable on the Web book um they're also on this slide there if you want us to run another session on another topic this session actually came about as a result of feedback from some of the service providers we had engaged with um in producing our report um so we will we will put them on if there is a demand so thank you again we will make this presentation the recording and and slide decks available on our website I will drop you an email as soon as we've done that but otherwise I think it's goodbye aming thank you shant as well for hosting my pleasure see you all on the other side