Earlier this month, Human Resources and Skills Development Canada released a Report on its National Call for Concepts for Social Finance. The Call for Concepts was a public policy consultation initiated by HRSDC in November 2012 seeking public submissions on innovative new concepts for social finance. HRSDC has been engaged in several pilot projects in the area of social finance over the past 18 months, and its Call for Concepts sought new ways in which different types of entities – charities, non-profit organizations, businesses and individuals – could work together to support projects that will benefit the community.
HRSDC reported that it received over 150 submissions from a range of stakeholders, including charities, NPOs, businesses and government. The Report highlighted a number of specific concepts that were submitted to HRSDC to address specific social problems ranging from unemployment, to access to health care, to housing programs and support programs for new immigrants. The submissions highlighted ways in which social finance tools can be used to support or expand these programs.
The Report summarized a range of social finance tools that can be used generally to support socially beneficial projects. These tools included:
- social impact bonds, in which investors contribute capital to a project and receive a return on investment if the project achieves certain measurable social benefits
- social investment funds, which pool capital for the purpose of making investments (often with less stringent repayment terms) in not-for-profits, social enterprises and social purpose businesses
- sector capacity-building organizations, including the possibility of new exchanges to build capacity for social investment in infrastructure projects
- social enterprises, which combine business-like activities in furtherance of a socially beneficial goal.
Now that the initial consultation is complete, HRSDC indicates that it will continue the conversation about social finance through various forms of public outreach. HRSDC stated that the concepts received may help shape future requests for proposals to launch a social finance initiative and to identify potential partners to pilot a social innovation.
It is clear that the government sees great potential in social finance and social enterprise. Organizations that work in this area should keep an eye on HRSDC’s website to see about opportunities to participate in the discussion as it goes forward. We will continue to update our readers in this Newsletter as this initiative progresses.