Valuing social impacts: Should government pay for results?

Deepening spending cuts and sluggish economic growth is driving Government to do things differently. Engaging and incentivising voluntary and social enterprises to tackle social issues and improve outcomes for vulnerable groups is a key part of the Big Society programme.

Government has embarked on a number of pilot Payment by Results (PbR) programmes. The expectation is that PbR will deliver new and enhanced services to address social needs that, in turn, will lead to better outcomes and consequently reduce public exchequer costs.

In order to understand whether these outcomes are achievable it is important to understand how social impacts can be measured, monetised and traced to actual reductions in public sector activities and/or expenditure.

This Talking Points publication, the first in a series of three, provides an approach to measuring social impacts and looks at practical steps to achieve wider adoption of Payment by Results schemes across government and the public sector.

Look out for the next in the series on: Measuring social impact in the voluntary sector; and Economic, social and environmental impact in the private sector.