International Update – July 2020

As the world grapples with the impact of Covid-19, early indications suggest that outcomes-based contracts are adapting to the radical change caused by the pandemic.

In this update we:​
  • Unpack the impact of Covid-19 on the four live Impact Bonds Social Finance is involved with in sub-Saharan Africa, Latin America and the Middle East;​
  • Consider six ways that outcomes-based contracts could be launched more quickly to support post-Covid recovery efforts;​
  • Explore the potential role for innovative finance in supporting equitable access to, and efficient deployment of, a Covid-19 vaccine; and
  • Provide highlights of some of our other work in low and middle income countries.

Impact Bonds & Covid-19: Adaptation in the face of uncertainty

In 2019, Social Finance’s International team supported the launch of four new impact bonds, in four regions, spanning multiple sectors from WASH to youth employment. These contracts were designed to enable adaptation to change, but none of them planned for an event with the impact of Covid-19.

Whilst the situation continues to evolve, it is heartening to see that – in line with emerging indications from Impact Bonds elsewhere in the world – public, private and philanthropic stakeholders are working together to ensure ongoing service relevance, continuity and adaptation to operational and evaluation constraints:

  • The KMC (neonatal survival) Development Impact Bond in Cameroon (PDF) has encountered significant operational challenges as implementation takes place in a hospital setting. The programme has funded additional PPE for clinical teams, introduced remote consultations to ensure quality outpatient care during this time, and shifted to a remote outcome verification methodology to limit the presence of non-clinical personnel in hospitals. ​​

  • Covid-19  has prompted an accelerated focus on healthcare and health and safety jobs in the West Bank and Gaza Youth Employment DIB (PDF).  Looking forward, the impact of Covid-19 on the economy and labour demand is likely to mean a more challenging delivery environment for the programme. Consideration is being given to operational adjustments, such as virtual delivery of aspects of the training, if needed.​​

  • The Cambodia Rural Sanitation DIB (PDF) is at an early implementation stage. Fortunately, Cambodia has not been badly hit by Covid to date. Other than an extended leave over the Khmer New Year period in April for the staff of iDE, the lead organisation,  implementation of this markets-based approach has been able to continue, albeit with enhanced hygiene precautions. The DIB is currently ahead of its targets.​​

  • The delivery of the Chile Literacy Impact Bond (PDF) has been paused while schools are closed. Virtual delivery is proving challenging due to the children’s age and the vulnerability of the target cohort.  Various options, including subsidies, are being considered to get the programme back on track when schools reopen.​

The KMC Cameroon and the West Bank and Gaza Youth Employment DIBs were discussed on the GO Lab’s Emergency Responses and Government Outcomes (ERGO) peer learning group on the implications of Covid-19 in low and middle income countries. Watch a recording of the session.

Outcomes-based approaches for post-Covid recovery: six ways to accelerate contracting​

The ability of outcomes-based contracts to respond to change and uncertainty indicates that they could have an important role to play in post-Covid recovery. To play this role they will need to move from design to launch much more quickly.

Our Director Louise Savell outlines the six ways in which outcomes-based approaches could be adapted to enable this. ​

Read the article

Upcoming LMIC Employment Webinar

In the first of a series of webinars focused on skills training and employment, we discuss lessons from outcomes-based approaches to employment in low- and middle-income countries.
Chaired by Oxford academic and GO Lab Director, Dr. Mara Airoldi, panellists will explore why outcomes-based employment approaches are used, how they have responded to contextual change and uncertainty, and whether outcomes-based approaches can play a role in supporting post-Covid employment.

Register for the webinar and join us at 3pm BST on July 28th 2020.

Recent Blogs

Leave no-one behind: can we deploy a Covid-19 vaccine quickly and fairly?

We are seeing unprecedented speed and innovation in the race for a Covid-19 vaccine. But funding also needs to be structured differently to ensure equitable access and efficient deployment once it is available.​

The ties that bind: Can smart subsidies play a role in ending bonded labour?

This blog summarises key findings from our longer report (below) which was funded by the UK's Department for International Development.

Why women’s agency matters in the fight against HIV

To mark International Women’s Day, we caught up with Dr Nevilene Slingers of the South African Medical Research Council to learn more about how HIV affects young women in South Africa and what can be done about it.

Equality matters: Scaling effective Kangaroo Mother Care in Cameroon

We reflect on the role of gender equality in supporting neonatal survival in hospitals across Cameroon. Clinical staff work hard to engage fathers and other family members in both providing and supporting Kangaroo Mother Care in Cameroon.

Food for thought: The case for a global Nutrition Outcomes Fund

Recent estimates suggest that global targets for reducing stunting could be met at a cost of just $8.50 per child if high levels of effectiveness and efficiency can be achieved at scale.

In the first of our series of Outcomes Based Approaches reports, our Director, Peter Nicholas, explores how the strong incentives to focus on results and adaptive delivery generated by an Outcomes Fund could achieve such efficiency. ​

Read the report

Innovative finance to address bonded labor in supply chains

Social Finance was commissioned by Humanity United to identify what role innovative finance could play in tackling irresponsible recruitment practices to prevent migrant workers from falling into bonded labour.

Some multinational brands have tried to address this problem by requiring employers to implement ‘employer-pays’ recruitment, but the problem persists.

This report proposes an outcomes-based smart subsidy to complement this approach and make ‘employer pays’ recruitment more economically attractive.​

Read the report
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