Impact Policy Tracker Policy

Social Impact Partnerships to Pay for Results Act (SIPPRA)



The Social Impact Partnerships to Pay for Results Act (SIPPRA) is a U.S. federal piece of legislation designed to support Pay for Success mechanisms at the sub-national level. SIPPRA channels $100 million to help state and local governments launch or explore the feasibility of pay for success initiatives. The bill was enacted as part of a larger legislative package, the 2018 Bipartisan Budget Act, designed to support pay-for-results projects that aim to improve social outcomes and save government money accross a wide range of focus areas and priority populations.

Projects typically involve partnerships between governments, service providers, and private or philanthropic investors, with independent evaluators verifying outcomes. If the results are achieved, the government reimburses part of the investment or provides success payments. Beyond funding, SIPPRA helps governments embed outcomes-based decision-making and improve accountability and innovation in public service delivery.

Highlights

  • US Impact Investing Alliance, a champion of pay-for-success schemes: SIPPRA builds on the work of the USIIA, GSG Impact’s NP in the US, which has long championed outcomes-based financing as a key tool to drive measurable social change. SIPPRA incorporated most of the key recommendations set by the Alliance in its landmark Private Capital, Public Good report (2014), the first industry-wide publication emphasising the benefits of impact investing and demonstrating how policy could support an increased flow of capital to the sector.

  • From federal to local: SIPPRA is a strong example of how, in federal countries, national policy can support the subnational development of impact investment ecosystems by directing federal resources to local outcomes-based projects. By enabling state and local governments to access funding tied to measurable results, SIPPRA empowers communities to design, test, and scale solutions tailored to their specific social challenges. It builds on a key strength of outcomes partnerships: aligning interventions with community needs and locally relevant approaches.

Government’s Role:
Market Participant


Country:
United States

Policy Type:
Outcomes partnerships

Year: 2018

Responsible Institution:
Department of the Treasury

Outcomes partnerships

What are outcomes partnerships?

Outcomes partnerships are innovative funding mechanisms that link payments to the achievement of measurable social or environmental outcomes, rather than to the delivery of predefined services. They typically involve three core parties: a government or public entity acting as the outcome payer, a service provider delivering the intervention, and a third-party investor supplying upfront repayable finance. The investor is repaid, partially or fully, only if the agreed outcomes are achieved. This structure shifts financial risk away from the public sector, encourages performance-based service delivery, and enables more flexible, adaptive approaches to addressing complex social challenges. It underpins instruments such as Social Impact Bonds (SIBs), Development Impact Bonds (DIBs), Career Impact Bonds, and outcome funds.

Outcomes partnerships have emerged from pioneering efforts in the UK and were developed in response to the limits of traditional, one-size-fits-all service delivery, especially in sectors like health, education, and employment. They have helped improve public sector effectiveness (delivering up to 9x of public value for every $1 invested), mobilise private investment for the public good, and strengthen performance management through learning and adaptation. Outcomes partnerships rest on three key principles: 1) collaborative design, where stakeholders co-create shared goals; 2) flexible delivery, allowing for real-time learning and local adaptation; and 3) clear accountability, with transparent reporting on tangible, person-centred outcomes.

For more information, visit GSG Impact’s reports, Shifting Gears - Challenges in scaling outcomes partnerships in government and strategies for success and Tying funding to results, and Oxford University’s Government Outcomes Lab website and its latest report “The evolution of social outcomes partnerships in the UK”.