15 Feb PERSPEKTIVE:ARBEIT – Austria´s First Social Impact Bond
The first of its kind in Austria, the pilot project PERSPEKTIVE:ARBEIT (Perspective:work) has been financed as a social impact bond (SIB). The project provides comprehensive and targeted services for women affected by violence in Upper Austria, making it possible for them to use reliable employment to exit the cycle of violence for good.
An SIB is an innovative financial instrument that is based on the concept “pay for success.” It allows the public sector to use prevention measures and experiment with new project approaches, which once successful can be expanded. The Austrian government is also currently experimenting with new approaches to social policies by means of the SIB PERSPEKTIVE:ARBEIT.
Here’s how it works
The public sector defines the content and financial framework of an SIB, as well as the central criteria for success. Upfront financiers such as foundations take over financing and default risk. Only in the event that the project’s goals for success have been achieved are the pre-seed investors repaid their capital, adjusted for inflation, by the public sector. Specialized organizations, for example NGOs or non-profit organizations, execute the project. Whether an SIB was successful is determined by an independent business agency review, based on the pre-determined criteria.
In addition, the project can receive additional outside support. The advantages? SIBs promote close cross-sector cooperation and produce transparent results, which can provide clarity about which approaches work best in the social sector.
Every fifth woman in Austria is a victim of domestic violence. 40 percent of these women have not completed their secondary education, or have discontinued an workforce education or compulsory schooling. These circumstances put them at a professional disadvantage and make them socially and financially dependent on the men in their lives.
First launched in Upper Austria, PERSPEKTIVE:ARBEIT supports women affected by violence through individual guidance and by working closely with the Violence Center of Upper Austria, the Women’s Center of Linz,and the Unemployment Office and government of Upper Austria. Using a variety of resources, a holistic approach to helping women work through their experiences and find secure work can enable them to achieve social and financial independence, allowing them to escape structures of violence for good.
(Upfront financiers of the first Austrian SIB are ERSTE Foundation, Hil Foundation, Schweighofer Private Foundation, Juvat and Scheuch Family Foundation.)