Market Sounding: Aboriginal Economic Development Office of Social - PowerPoint PPT Presentation

Market Sounding: Aboriginal Economic Development Office of Social Impact Investment 26 June 2018

Agenda Market sounding for Aboriginal economic development SII 3. Aboriginal economic 1. Welcome and 5. Q&A session development policy introduction context 2. What is social 4. SII development impact guidance investment? NSW OSII 2

Welcome Presenter: Warren Mundine AO

What is social impact investment? Presenter: Ben Gales Executive Director Economic Strategy, NSW Treasury

What is social impact investment? Investors, providers and agencies work together to generate social outcomes alongside financial return • Investors provide upfront funding for services and take on financial risk of outcomes achievement Investors • Investors include: superannuation funds, banks, foundations, provide upfront funding for and HNWIs services • Providers deliver outcomes and are free of input controls and \ restrictive service specification Government Service savings are used providers • SII Providers include: Uniting, Benevolent Society, ACSO, to repay deliver agreed investors and Arbias, Flourish, Silverchain, St George Community Housing social outcomes pay them a return on investment • Agencies pay for outcomes achieved, driven by benefits and future savings associated with improved outcomes • Agencies include: FACS, Ministry of Health and Correction People’s lives improve and they Services NSW need less support NSW OSII 5

Global reach Social impact investment is a growing global phenomenon Netherlands: 8 Portugal: 4 France, Germany, Finland: 2 Sweden, Switzerland, Belgium, Austria: 1 4 (Canada) 40 2 20 (UK) (S. Korea) 3 (USA) 2 2 (Japan) (Israel) (India) 1 (Congo) 1 1 (Columbia) (Cameroon) 1 (Peru) 8 1 (NZ) (Australia)  108 SIBs in 22 countries  $392m capital raised, reaching more than 700,000 people NSW OSII 6  $500b to $1 trillion potential market value this decade (Source: Social Finance 2017, Impact Bond Global database, https://sibdatabase.socialfinance.org.uk/)

SII in NSW NSW remains a market leader in social impact investment SII has operated in NSW since 2013. The Office of Social Impact Investment (OSII) and the Government Social Impact Investment Policy were launched in 2015. OSII has worked with hundreds of NGOs, private investors, and intermediaries to develop market capacity, test innovative services and build evidence of what works. Six NSW investments valued at over $200 million and are supporting better services for 16,000 people and families in NSW. Domestically, other jurisdictions draw heavily on NSW experience in developing SIIs. NSW has delivered 6 investments; Queensland (3); Victoria (2); and SA (1). NSW OSII 7

NSW SII Portfolio Investments in a broad and diverse range of human services Reducing OOHC Reducing Supporting Silverchain Newpin Resolve entry, helpline re-incarceration stable housing reports and risk of parolees in and employment assessments Sydney for young people Restoring Reducing Reducing children to hospital usage hospital their families for palliative usage for Resilient OnTRACC Foyer51 and reducing Families care patients mental health OOHC entry patients NSW OSII 8

Why SII in Aboriginal economic development? SII creates a unique opportunity for Aboriginal economic development What makes social impact investment unique is that it combines the following four attributes which can create a valuable opportunity for a place-based Aboriginal economic development SII. Outcomes Innovation Partnerships Investment Measuring and paying for Investing in early intervention and Setting incentives and removing With government and non- outcomes prevention to reduce long-term cost input controls on services government sectors SII will enable Government to Complex and significant Clear evidence that success in Compelling case to invest earlier build an evidence base of what and improve long-term social and challenges require new and Aboriginal affairs requires works for future policy and service economic outcomes. SII is a proven creative policy solutions. SII is an Government to work with people settings focused on Aboriginal opportunity try, test and innovate and communities. SII involves model for driving change in economic development with new approaches genuine co-development and individual service trajectory community-led implementation 9 NSW OSII

Aboriginal economic development SII Empowering Aboriginal communities in the NSW Budget 2018-19 The 2018-19 Budget has delivered investments to support the wellbeing of Aboriginal people across NSW. This includes $10 million over four years for a social impact investment in Aboriginal economic development opportunities. NSW OSII 10

Aboriginal economic development SII Potential outcomes to be targeted in SII proposals The Aboriginal economic development SII will Proposals will be assessed on the proposed provide place-based support with a focus on outcomes as well as other factors including: specific outcomes. Primary payment outcomes may fall under the following domains: Additionality – how the service addresses an unmet need or targets those not currently Economic – such as increased employment, accessing services, to maximise effectiveness and income and Aboriginal businesses. minimise duplication. Education and training – such as increased post-secondary education. Scalability – proposals should also identify any opportunities for the service to be scaled up or Secondary evaluation outcomes may also include replicated across the public sector. safety, health, and social and community outcomes. NSW OSII 11

Aboriginal economic development policy context Presenters: Haylene Grogan, Director Policy and Reform Aboriginal Affairs NSW Karl Eaves, Director Community Partnerships Aboriginal Affairs NSW

Social Impact Investment Aboriginal Economic Development

Agenda for today Context Demographic Data What works? Current initiatives Questions

Context

Economic Development in an Aboriginal Context – Overview Deloitte Access Historically, Economics There is a Aboriginal people While this has been estimate that if significant were systemically gradually changing, Aboriginal people opportunity to boost excluded from there remain were fully engaged the NSW Economy much of the significant in the NSW by working with mainstream differences in Economy, that Aboriginal people to economy, relegated economic NSW would benefit realise their to largely participation and by $7.4 billion per economic agricultural and outcomes. annum, or 1.5% of aspirations. menial labour. Gross State Product.

Demographic data

Where Aboriginal People Live 4 out of 5 Aboriginal people in NSW live in cities or major regional centres. NSW is home to 1/3 of Australia’s Aboriginal people.

Current Engagement in the NSW Workforce Regional Participation Employment Occupation Context Significant regional 54.3% of 15+ in the differences 15.3% unemployment More likely to be workforce employed in Public Administration, Health and Education. 33.7% of Aboriginal people in Sydney employed in full time work, compared with 22.9% in the regions. An increase from 51.2% in An improvement from 2006 19.3% in 2006. Aboriginal unemployment in Sydney is 11.3% compared to regional NSW at 18.1%. Less likely to be employed in Finance, the Professions, Wholesale Compared to 69.5% of Compared to 6% of non- Aboriginal participation Trade. non-Indigenous residents Indigenous residents of rate in Sydney is 59.3% of NSW. NSW . compared to regional NSW at 50.3% Source: 2016 Census, Australian Bureau of Statistics.

Revenue, Assets and Capital Home Self Income Business Ownership Employment Median equivalised 10.2% of employed 30% increase in 41.7% home household income Indigenous people Indigenous people in ownership. $650-$799 p.w. are self employed business since 2011 Compared to 65.3% An increase from An increase from Revenues growing at for non-Indigenous $507-759 in 2006 5.8% in 2011. 12.5% per annum. residents of NSW. 29.2% of renters in Compared to $1000- Supply Nation housing authority Compared to 15.4% 1249 for non- businesses reported housing, compared to for non-Indigenous Indigenous residents $1.15 billion in 11.6% of non- Australians of NSW. revenue in 2014-15. Indigenous residents. Sources: Productivity Commission, Overcoming Indigenous Disadvantage Report 2016, and Business Council of Australia survey.

Other Useful Data Sources Aboriginal Affairs NSW Research https://www.aboriginalaffairs.nsw.gov.au/new-knowledge Australian Government Indigenous Clearinghouse https://www.aihw.gov.au/reports-statistics/population-groups/indigenous- australians/overview Centre for Aboriginal Economic Policy Research http://caepr.cass.anu.edu.au/ Harvard Project on American Indian Economic Development https://hpaied.org/

What works?