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Payment by Outcomes Trials

The Australian Government has committed a $15.7 million from 2019-20 to 2026-27 to design, implement and evaluate three Payment by Outcomes (PBO) Trials in the social services sector.  

PBO is a form of social impact investing contract held directly between the Australian Government, as funder, and a service provider. In a PBO contract, the service provider is typically paid a portion of the contract value upfront and a portion on achievement of agreed outcomes, thereby taking on more of the risk for achieving the outcomes.  

The objectives of the PBO Trials are to:

  • test the appropriateness and efficiency of PBO contracting arrangements between the department and funded organisations to inform future potential funding arrangements 
  • inform how the department and its service providers can increase the design and use of robust outcome measurement
  • assess if policy areas and models used in the trials are suitable for payment by outcomes funding mechanisms in social services.

Trial one - Many Rivers Microenterprise Development program 

The Many Rivers program aims to improve outcomes in workforce skills, business planning and employment opportunities, including microenterprise development and self-employment, to support unemployed or underemployed persons into employment. 

The program has commenced and will continue until 2025-26.

Trial two - Save the Children Australia 

Save the Children Australia will engage families from low SES backgrounds with children aged 3-4 years in South East Tasmania and aim to improve school readiness and increase school participation. 

The program commenced in December 2021 and will continue until 2025.

Trial three – Under development 

The program, which is under codesign, is expected to focus on improving employment outcomes for disadvantaged jobseekers through work integrated social enterprises (WISE), to provide wrap around supports that will build participants confidence and job readiness. 

Contact:

SocialImpactInvesting@dss.gov.au
 

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