Briefing / Social investment

When finances are tight, it can be difficult to fund innovations that will help patients and services into the long term. The NHS long term plan stresses the importance of changing our models of care and improving primary care, public health, prevention and community-based services. But financial challenge and operational pressures mean it is difficult to redirect resources and invest in the changes that are needed. 

One option is social investment, whereby external investors provide upfront funding for projects that will contribute to social or environmental goals. Most types of social investment are not available to the NHS because they take the form of loan finance or borrowing, which is rarely permitted under the requirements of Managing public money. However, a newer type of social investment called social impact bonds is becoming more popular and is available to the NHS. 

This briefing is aimed at NHS staff and gives a short overview of what social investment is, with a focus on social impact bonds. It explores the circumstances in which social investment can work well, along with the risks, before explaining how to account for social impact bonds.