Social innovation, financialisation and commodification: a critique of social impact bonds

ABSTRACT

Despite a lack of evidence of their effectiveness there is increasing enthusiasm for Social Impact Bonds (SIBs) from diverse political perspectives across the world. This paper argues that while SIBs may potentially be applicable to some technical policy interventions which address relatively simple conditions, they are inappropriate for the complex conditions characterising wicked social problems. Enthusiasm for and over-extension of SIBs reflects a simplistic view of “evidence-based” policy. More fundamentally, SIBs commodify citizens and redefine service users as problems and potential revenue sources rather than conscious agents. SIBs therefore exemplify a prevalent ideology of marketisation and financialisation in social policy.

KEYWORDS:

• Structure and scope of government
• Publicly provided goods
• Development planning and policy

JEL CLASSIFICATION:

• H11
• H44
• O20

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. For example, the Career Connect Youth Engagement Fund in Greater Manchester – https://sibdatabase.socialfinance.org.uk/.

2. We are grateful for the insight provided by an anonymous Reviewer who noted that there is a tendency in the SIB literature for those who support them to come from think tanks, third sector organisations, government agencies and corporate sponsors; and for these more favourable accounts to be published in policy documents, briefings and practical guides and manuals. Examples in this article include contributions from the Centre for Public Impact (2016), or Kohli, Besharov, and Costa (2012). In contrast, more critical discussions of SIBs are more likely to appear in academic journals. Examples cited in this article include those of Edmiston and Nicholls (2018) or Joy and Shields (2018). This is a potentially interesting example of the role of different interpretative communities and dissemination formats in framing academic and policy discourses.

3. https://sibdatabase.socialfinance.org.uk/.

4. A so-called “thick” active labour market or ‘employability service is characterised by significant investment in human capital development (education and training provision), job brokering and mediation services which build effective relationships between employers and job-seekers, and support which reduces barriers to sustainable employment, such as assistance with transport costs. One SIB-funded initiative which possesses elements of such an approach is the Colour Kitchen youth training and employment initiative in Utrecht – https://sibdatabase.socialfinance.org.uk/

In contrast, “thin” work-first schemes focus on pushing benefit recipients into any form of employment as soon as possible. See Levy 2004; Carter and Whitworth 2016).

5. https://sibdatabase.socialfinance.org.uk/.