Getting Results, a report for the Centre for Policy Studies thinktank written by Conservative MP Julie Marson, argues that the Treasury should make use of SIBs as a way to focus on outcomes-based approaches and deliver the economic impact that is required.
“Contrary to traditional input-led approaches that operate on a ‘fee for service’ basis, results-based approaches pay only when the agreed outcomes have been achieved,” the report explains.
It adds that SIBs are unique from other outcomes-based approaches in their involvement of private investors to fund the working capital of a project.
“The development process of SIB projects requires stakeholders to collaborate closely over long periods of time, leading to the formation of long-term partnerships built on a shared appreciation of impact and an alignment of incentives,” the report says.
“As we prepare for the Budget and Spending Review at the end of October, we must bring down borrowing and reduce wasteful spending while continuing to fund new interventions, infrastructure projects and services improvements that will get the whole country back on its feet,” Marson concluded.