The federal government has been engaging with civil society and the private sector for several years, investigating whether and how the government could support social finance initiatives. Social finance is intended to bring private investment to social purpose. Social finance initiatives could include “pay-for-success” models in place of outright grants to fund programs, social procurement which would encourage civil society organizations to bid on government contracts, and/or contributing to a fund that could support civil society to innovate and create social enterprises.
The committee recommends that the federal government create and contribute to a pan-Canadian social finance fund. The fund would operate at arm’s length from the government, thus not constraining how funds are raised or spent, other than to determine its purpose and to establish accountability mechanisms for its contribution.
The committee recommends that when assessing where to invest federal money in a social finance fund, the government look for opportunities to leverage funds from other investors.
The committee recommends that the federal government explore the use of dormant bank accounts as their basis of capital for the social finance fund.
The committee recommends that a portion of the federal contribution to a social finance fund be targeted to the development of new intermediary funds that will provide economic and social opportunities to traditionally marginalized regions and communities.
The committee recommends that the fund support institutional capacity building to ensure that organizations are capable of participating in the social finance ecosystem.
The committee recommends that the federal government make a multi-year commitment to a social finance fund, with fixed amounts flowing periodically over those years, and that the government anticipate a longer time to offer returns.
Table of Contents
ORDER OF REFERENCE
SOCIAL FINANCE FUNDS
A. Social Finance Funds in Canada
B. Social Finance Funds in Other Countries
THE PROPOSED ROLE OF THE FEDERAL GOVERNMENT
APPENDIX A: FUNDS AND INITIATIVES IDENTIFIED BY WITNESSES
APPENDIX B: LIST OF RECOMMENDATIONS
APPENDIX C: LIST OF WITNESSES
APPENDIX D: BRIEFS
SOURCE: The Senate of Canada