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Commissioning Better Outcomes and the Social Outcomes Fund

Big Lottery Fund and the Cabinet Office are working together to support the development of more innovative approaches to improving social outcomes
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Area:
England
Application deadline:
31/07/2016 23:59:00

What’s it all about?

Commissioning Better Outcomes (CBO) is closed to new expressions of interest and new development grant applications. You can still apply for a CBO Full Award by 31 July 2016, provided we have previously agreed your expression of interest.

Please also note that the Social Outcomes Fund is not currently open to new funding bids; so you will need to target your full application at CBO requirements.

What’s it all about

We are focusing on approaches that use payment by results (PbR) mechanisms, particularly those which involve social investment such as Social Impact Bonds (SIBs).

To achieve this we have set up two funds - the Cabinet Office’s Social Outcomes Fund and the Big Lottery Fund’s Commissioning Better Outcomes – with a joint mission to support the development of more SIBs. Between them, these funds are making up to £60 million available to pay for a proportion of outcomes payments for these types of models in complex policy areas, as well as support to develop robust proposals.

Aims

Our shared overarching aim is to grow the market in SIBs, while each fund has a specific focus that reflects the missions of the Big Lottery Fund and Cabinet Office. For the Big Lottery Fund, this is to enable more people, particularly those most in need, to lead fulfilling lives, in enriching places and as part of successful communities. For the Cabinet Office, this is to catalyse and test innovative approaches to tackling complex issues using outcomes based commissioning.

Support

Applicants who have been successful at the expression of interest stage can get technical support from a range of specialist providers. Applicants may be able to apply for a development grant to partly pay for this support. Please refer to the Directory of SIB Service Providers under the Related Documents section of this page.

Useful resources and contacts

The Cabinet Office Centre for Social Impact Bonds provides light-touch support to SIB developers and has produced a series of tools and resources for developing SIBs. You can contact the Centre for Social Impact Bonds by emailing sibs@cabinetoffice.gsi.gov.uk

Bridges Ventures, in conjunction with Bank of America Merill Lynch, published a Practitioner’s Guide to Choosing Social Bonds. This is aimed at supporting those who commission social outcomes, those who deliver them and those who provide capital to enable them in obtaining clarification of how SIBs can unlock better outcomes.

The Outcomes funds have committed funding to a varied range of CBO development grants and the first full awards. A PDF containing copies of press release summaries relating to successful applications to December 2014 can be found below.

Organisations new to the concept of ‘Social Impact Bonds’ may find it useful to complete this quiz. The tool is intended to guide readers through the core aspects of the development of Social Impact Bonds. It is also designed to highlight where your knowledge gaps lie and where you may need additional advice or support’

Contacts

Big Lottery Fund has appointed Ecorys and ATQ Consultants as programme evaluators. More detailed information on this CBO programme evaluation is provided in PDF form as a related document below.

Social impact bonds: The State of Play report by Ecorys and ATQ

Ecorys and ATQ have also produced a report on Social Impact Bonds: The State of Play. This report looks at the state of play of SIBs in the UK and the perceived challenges and benefits of them. The report draws on a review of available literature about SIBs; a series of in-depth consultations with organisations centrally involved in the policy, strategic and/or operational development of SIBs; and surveys with the core groups involved in SIBs.

Summary information on the evaluation is set out below. Further detailed information on the evaluation can be found on the evaluation page

What are we looking for?

There is growing interest among public sector commissioners in the potential of SIBs to tackle complex and expensive social issues. Commissioning Better Outcomes and the Social Outcomes Fund have a joint overarching aim to support the development of more SIBs; however, each fund has its own specific focus that reflects the respective missions of the Big Lottery Fund and the Cabinet Office.

The objectives for the two funds are set out below:

Commissioning Better Outcomes Social Outcomes Fund

Improved skills and confidence of commissioners with regards to the development of SIBs.

Increased innovation in public service delivery through outcomes based commissioning.

Increased early prevention is undertaken by delivery partners, including VCSE organisations, to address deep rooted social issues and help those most in need.

Improved cross-government working in public service delivery and encouraging co-payment by different commissioners.

More delivery partners, including VCSE organisations, are able to access new forms of finance to reach more people.

Increased number of SIBs addressing complex needs and demonstrating ability to replicate by standardising the process.

Increased learning and an enhanced collective understanding of how to develop and deliver successful SIBs.

Increased capacity for SIBs as a long term tool of government to improve outcomes and reduce costs, by supporting SIBs that test cashability of savings and ensure evidence is gathered to:

  1. determine performance of interventions on their primary outcome
  2. increase evidence on the impact of interventions on wider outcomes
  3. improve outcome valuation.

 

We will decide during assessment which fund is most appropriate for your application and in some cases may decide to jointly fund projects.

Who can apply?

As many of the objectives for the two funds complement each other, there will be a single set of forms to make applying as simple as possible

Applicants follow a two stage application process consisting of an expression of interest (EoI) and, once this is approved, a full application. Commissioners, providers or intermediaries can all submit an EoI, but we expect full applications to be from a commissioning organisation (typically a public sector organisation) based in and serving people in England. For example:

  • a Local Authority, seeking to improve outcomes for troubled families.
  • a Central Government Department, seeking to reduce problem drug use.
  • a Clinical Commissioning Group, seeking to reduce hospitalisation of the elderly.
  • a Police and Crime Commissioner, seeking to reduce gang membership.

In exceptional circumstances we would consider full applications from other organisations (such as providers) based in and serving people in England as long as there is a commissioner involved. Please discuss this with us before applying.

Throughout the development of your model, we expect you to:

  • undertake early and extensive research and stakeholder engagement
  • consult with beneficiaries
  • consult with a wide range of potential delivery partners, including those from the voluntary, community and social enterprise (VCSE) sector
  • find support for your SIB from a range of different stakeholders such as other commissioners, investors, delivery partners and prime contractors
  • be aware of your obligations under the Public Services (Social Value) Act 2012, and consider how any procurement might improve the economic, social and environmental wellbeing of the local area.

How much is available?

The Big Lottery Fund has up to £40 million available through Commissioning Better Outcomes. Up to £3 million of this total has been set aside for development funding.

The Cabinet Office has up to £20 million available through the Social Outcomes Fund.

In your full application you can ask us to pay for a minority proportion of outcome payments to cover, for example, non-cashable savings or savings that fall to other commissioners who cannot pay for outcomes. There is no minimum or maximum funding available for each SIB but we expect the average amount of funding to be around £1 million. We will only contribute a minority proportion of outcomes payments, and expect the average contribution to be around 20 per cent of the total outcomes payments.

You can ask for between £10,000 and £150,000 of development funding to purchase technical support to develop your SIB.

More funding may be available in exceptional circumstances. Please discuss this with us before applying.

Funding cannot be used for:

  • day-to-day running costs for organisations
  • pilot activities or any direct service delivery
  • retrospective costs.

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Organisation Types

  • Voluntary or community organisation
  • Public sector organisation
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