Webinar: Setting up the payment mechanism in an outcomes-based contract

For an outcomes-based contract to work, there needs to be a set of rules written down, explaining when and what evidence needs to be provided for the government agency (or outcome funder) to pay. Collectively, these rules are often referred to as a 'payment mechanism'. A payment mechanism may not consist entirely of payment for outcomes - these are sometimes only used to pay part of the total contract sum, with the rest either being for delivering a specified service (as in the more traditional approach) or for evidencing particular outputs (e.g. showing people engaging with the service, or completing a course). Developing the payment mechanism is often seen as one of the most challenging aspects when setting up an outcomes-based contract, and there are multiple considerations to take into account and various ways to price outcomes. 

This webinar session will discuss the key considerations that those developing SIBs and other outcomes-based approaches need to keep in mind as they build the payment mechanism for their SIB contract. The session will provide a wealth of practical advice and top tips on how to design a robust payment mechanism, using a range of real-life examples to illustrate the process of developing a payment mechanism. 

Some of the questions that we will cover in this session include: Should the payment be 100% on outcome or should some proportion of the contract value be paid for activity rather than outcome? How can I make sure I am paying the right amount for the desired outcomes? How often should payments be made? Should payment be tied to an impact evaluation or administratively defined outcome measures?

Nigel Ball, Deputy Director & Head of Commissioning Support, GO Lab

Nigel leads the work of engaging government commissioners and other practitioners in the research and best practice generated by the GO Lab team. Prior to joining the GO Lab, Nigel was part of the founding team of West London Zone for Children and Young People, where he set up a 'Collective Impact Bond', which leveraged multiple public and private sources of funding to be paid when the children supported achieve positive results.

Mila Lukic, Partner, Bridges Fund Management & GO Lab Fellow of Practice

Mila Lukic is a Partner responsible for Social Impact Bond investments at Bridges Fund Management. In this role, Mila manages the Bridges SIB Fund, the world’s first Fund dedicated to investing into social impact bonds. Bridges SIB Fund invested into over 20 SIBs so far across the following four policy areas: youth unemployment, children’s services, homelessness and health and social care.

Catherine Remfry, Economic Advisor, Department for Digital, Culture, Media and Sport

Catherine is an Economic Advisor to the Office for Civil Society in DCMS and leads the analytical team supporting the Centre for Social Impact Bonds. Prior to joining DCMS, Catherine worked across Whitehall in the (then) Department of Health on Financial Planning and in the Department for Transport on Aviation and Maritime analysis. 

Tim Gray, Consultant

Tim now works as a consultant. As a public sector commissioner, Tim led on the development of the first homelessness SIB for rough sleepers in London, the MHCLG Fair Chance Fund SIB programme, and the current Brent Council homelessness prevention SIB. Tim has also provided advice to a number of SIBs seeking support from the Life Chances Fund and the Commissioning Better Outcomes Fund.