with SIBs, the funding arrangements for the London Homelessness SIB deliberately duplicate some administrative costs. This is because the total funding is being split equally between St Mungo’s and a competitor organization called Thames Reach (). Each of these organizations will have to administer the contracts and implement management oversight of services they provide to the 200 cohort members assigned to them. The driving factor here therefore appears to be competition, not cost savings. This is entirely consistent with neoliberal governance, according to Willse (), who argues that the individual homeless person is not the primary target of neoliberal governance. Rather, the target is the social services sector itself, and its transformation from a cost of government to an engine of the economy, where entrepreneurialism and competition drive innovation and employment. Competition between St Mungo’s and Thames Reach is structured into the contractual model, with outcome measures rather than treatment standards driving the agreement between funders and service providers: The payment by results approach has allowed the providers flexibility to innovate. In particular, by not issuing a service specification and instead focusing on outcomes providers have been able to develop approaches that respond the needs of service users. () It is therefore an aspiration of the financial model that the two service providers will execute their duties in different ways, seeking to be more effective and efficient at dealing with their homeless individuals than the other provider was. Development of the SIB It is interesting to see how financial capacity, as opposed to service expertise, played a role in the awarding of the contracts to these two providers. Our interviewees at the Greater London Authority said that Social Finance provided the initial business case for the overall project, which the GLA then took to the homelessness sector in successive drafts. Organizations in the sector commented on these drafts, and the GLA made adjustments. For instance, the up-front fee for was increased. “reconnection” According to our interviewee at Triodos Bank, Triodos was then engaged by the GLA in the first half of
with SIBs, the funding arrangements for the London Homelessness SIB deliberately duplicate some administrative costs. This is because the total funding is being split equally between St Mungo’s and a competitor organization called Thames Reach (). Each of these organizations will have to administer the contracts and implement management oversight of services they provide to the 200 cohort members assigned to them. The driving factor here therefore appears to be competition, not cost savings. This is entirely consistent with neoliberal governance, according to Willse (), who argues that the individual homeless person is not the primary target of neoliberal governance. Rather, the target is the social services sector itself, and its transformation from a cost of government to an engine of the economy, where entrepreneurialism and competition drive innovation and employment. Competition between St Mungo’s and Thames Reach is structured into the contractual model, with outcome measures rather than treatment standards driving the agreement between funders and service providers: The payment by results approach has allowed the providers flexibility to innovate. In particular, by not issuing a service specification and instead focusing on outcomes providers have been able to develop approaches that respond the needs of service users. () It is therefore an aspiration of the financial model that the two service providers will execute their duties in different ways, seeking to be more effective and efficient at dealing with their homeless individuals than the other provider was. Development of the SIB It is interesting to see how financial capacity, as opposed to service expertise, played a role in the awarding of the contracts to these two providers. Our interviewees at the Greater London Authority said that Social Finance provided the initial business case for the overall project, which the GLA then took to the homelessness sector in successive drafts. Organizations in the sector commented on these drafts, and the GLA made adjustments. For instance, the up-front fee for “reconnection” was increased. According to our interviewee at Triodos Bank, Triodos was then engaged by the GLA in the first half of
Social_Impact_Bonds_201308a.docx