Khanty-Mansi Autonomous Okrug – Yugra, which comes third in the Ratings of Social and Economic Status of Russian Regions (RIA Rating, 2021), has been discussing the opportunity to launch social impact bonds in its territory with VEB.RF state corporation for the last two years.
"The topic itself is quite interesting, because it is close to the topic of concessions and public-private partnerships (PPP). PPP is developing quite well in the region, some concession agreements are also in place. We consider SIB projects implemented together with VEB.RF as a pilot. But so far we haven't found a specific topic to focus on, we're still considering all the options. On the whole, the idea is quite promising for a region like Yugra. It is likely that we will have such projects in the future", says Yakov Samokhvalov, General Director of the Yugra Center for Civic and Social Initiatives foundation.
SIBs can become a territorial development tool, albeit with some limitations.
"Social impact bonds are not a Russian invention, but a borrowing of foreign practice. They require adaptation to our legal system, budgeting processes, education about what examples of projects exist in the world and what domestic mechanisms are available in the country. The idea of buying only the finished result looks quite tempting per se. And I think that will play a part. We should probably talk more about this with specific examples that can be easily adapted to our country and specific territory", Yakov Samokhvalov added.
FIRST CHALLENGES
Only one of the seven social impact projects in our country is coming to completion in 2022, "Improving the Educational Performance of Students in the Republic of Sakha (Yakutia)". Therefore, experts believe it is too early to analyze the challenges faced by the project participants during their implementation. Open sources, including VEB.RF website, do not mention any problems when describing the interim results of the projects. Nor do the business media, such as Kommersant, Vedomosti, or RBC.
However, we can already talk about the general difficulties that emerged at the project launch phase. The regional government acts on behalf of the state, ordering the intervention and paying for the results of the project.
Social impact bonds are not a Russian invention, but a borrowing of foreign practice. They require adaptation to our realities.