Association for Public Policy Analysis & Management

Social Impact Bonds (SIBs) are often viewed as a new tool for public sector reform, albeit with similar promises and critiques as previous new public management strategies. In this paper, I offer a different conceptual framework for how SIBs might impact public service delivery that stems from the model’s four key features: multi-sector partnership, data monitoring system, external funding, and a payment for outcomes contract. I then apply this framework in a process evaluation of a SIB launched in Essex, UK, using in-depth interviews, document review, and observation of front-line staff. I find that the SIB had mixed effects on public service delivery in Essex. The model enabled rigorous monitoring of performance, availability of additional resources for the particular service, and outcome goal alignment across stakeholders. However, the SIB model also generated stakeholder conflict, feelings of resource burden and disproportionality by the government partner, loss of democratic accountability, and the pressuring presence of an underlying financial driver. I conclude with a discussion of policy implications, including the importance of safeguarding democratic accountability, developing positive relationships, and mitigating disproportionality.