Within the remit of Portugal Inovação Social (EMPIS), social innovation takes place when the experimentation or implementation of an innovative social entrepreneurial initiative delivers positive social impact. This is achieved when there is an improvement in the quality of life or positive change of one or more target groups. Social innovation aims at social change. It can happen at large scale and reach society as a whole or it can target a specific target group.
A Social Impact Bond (SIB) is mechanism that is used to fund the experimentation of innovative interventions in public services. It is outcome-based, which means it targets social outcomes, rather than outputs. SIB aim at experimenting intervention models that are more efficient than traditional models, in areas such as social protection, education, health, employment and justice.
Social Impact Bonds are contracts between public sector entities, private investors and delivery organisations, through which outcome metrics are pre-defined. Investors provide upfront funding to a delivery organization and are then repaid by the public sector upon achievement of such outcome metrics. Those outcome metrics are defined and computed most times based on potential savings they can yield to the public sector.
In Portugal, Social Impact Bonds are one of the four instruments made available by Portugal Inovação Social (EMPIS). As part of this instrument, each SIB establishes an outcome-based contract with the following stakeholders that together create a partnership: investors, public-sector entities (whose role is to validate the project outcomes according to public policy priorities) and delivery organisations. The contract established that investors are to be fully reimbursed in case the outcome metrics are achieved.
ONE.VALUE is a key tool in allowing SIB to reach scale in Portugal by providing information on the potential savings for the public sector related to efficiency gains delivered by innovative intervention models.
Within the context of a Social Impact Bond and according to the definition of Portugal Inovação Social, a social outcome corresponds to the improvement of a specific condition of a target group or individual, which eliminates a given vulnerability (e.g. entering employment, educational attainment, social inclusion, mental and physical health)..
No. Social innovation does not replace current intervention models funded by the State. Social innovation complements the existing intervention models and promotes collaboration across sectors, including the public, private and social. Social innovation also serves as an experimentation vehicle to test new approaches to entrenched social issues, aiming at finding more effective and efficient intervention models. When social innovation reaches a mature stage, it allows for a better resource allocation in public policies and, consequently, more and better impact.
Within the scope of ONE.VALUE, unitary public investment is the estimate of public expense incurred for the purpose of financing intervention models that address social issues in Portugal. It is presented as unitary values (per occurrence or per capita). For instance, what is the average unitary public investment per student or the average unitary public investment per child that is in the care system.
Unitary amounts are presents as the best possible estimates, available for the assessment of social entrepreneurial initiatives whose aim is to reach better efficacy and efficiency when compared to existing intervention models in areas such as unemployment, school dropouts and recidivism.
For illustrative purposes, let us assume a unitary cost of 200€ per year in the health sector. A correct interpretation of this amount doesn’t mean that each citizen affected by such health issue represents a cost of 200€ per year (most public investment goes to pay fixed costs, such as hospital infrastructure, that remain unchanged even if a group of individuals achieve better outcomes). Only events that deliver significant changes in a large target group can have a material impact on potential savings accrued for the entity that bears that cost.
The unitary public investment must be a starting point to better understand the economic value of past and future events. However, the size of such events is a key factor to fully understand how it can affect public expenses in a material way.
At ONE VALUE, one can find different unit indicators of the public investment done in the different public policy areas. Most of these indicators reflect exclusively direct costs bore by the public-sector. However, some also include indirect costs associated to the social challenges at hand. More information about each indicator and the type of costs reflected, can be found on each respective methodology.
In most cases, no. Unitary public investment figures made available by ONE.VALUE have not been adjusted to inflation. When updated to constant figures, there is a visible note stating so. In most cases, for instance, an amount from 2016 is presented in its current price, i.e., at 2016 prices.
It is important to have this in mind when assessing unitary public investment figures, when historical data is made available. The change of current figures across time for a unitary amount reflects, at least, the inflation in that year(s). On the other hand, if a constant amount is made available, it allows for comparability across historical data as if prices have not changed.
Please see here the inflation rate in Portugal. Learn more about inflation. Learn more about how to convert current amounts to constant amount.
Criteria used in the reliability rating:
The reliability rating follows this structure:
Criteria used in the update likelihood rating:
The update likelihood rating follows this structure:
High: At least annual update;
Medium: At least every three years;
Low: Non-regular update, no expectation of update