More Than Cost Savings

Brief

More Than Cost Savings

A New Framework for Valuing Potential Pay for Success Projects

Abstract

A popular benefit of the pay for success (PFS) model is its potential to finance programs that, if successful, will save governments more than they cost. But in practice, this limits the number of programs eligible for PFS. It also incorrectly assumes that most governments place little value on the non-fiscal benefits. With this reality in mind, this paper outlines a holistic framework that integrates potential fiscal and non-fiscal benefits, providing policymakers with clear and simple criteria when considering PFS projects.
This brief was updated in May 2017. Pages three, five, six, and seven were amended with clarifying language.

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