Transcript of Social Impact Bonds: Explained
Obama's US$3.7 Trillion Budget US$100 Million For what? Social Impact Bonds But what is a social impact bond? .003% Last week, U.S. President Barack Obama announced his budget. Social Security Health Care Defense Transportation Education But the most interesting part... What is that? A Social Impact Bond is a contract with the public sector in which it commits to pay for improved social outcomes that result in public sector savings. Huh? Basically, private investments will fund public services. The government pays up when the project is completed. But... and here's the kicker The government only pays if the program is successful. Sounds great, right? So no taxpayer money goes to failed solutions. Like any program, it has its pros and cons. + - The plan will encourage innovation to solve public problems. No taxpayer money will be spent on solutions that don't work. The government will only pay out of money saved from the program. Projects are funded right from the start. Measuring results will be time-consuming and difficult. The plan will involve a lot of cooperation between government agencies. An example: Who should pay out of savings if [a] supportive housing program lowers ER visits by the uninsured but also keeps extra kids out of shelters, in school, and, in the process, lowers crime? The health department? Human services department? Should it come out of the prison budget? Fast Company Wednesday, February 16, 2011 There are no answers yet. But if the program is successful it could serve as a great model for developing countries where governments have a hard time funding and following through on public service projects. Grassroots Business FundFull transcript
Gray Ghost Ventures
Clean Drinking Water
Bonds Investors Social Problems Think of the possibilities...