Cathy Pharoah: The problems the sector deals with have the hardest outcomes to measure

Martin Brookes was right to talk about assessing impact, but failed to address the most difficult cases, says our columnist

Cathy Pharoah
Cathy Pharoah

I found myself waving back at Martin Brookes's jaunty farewell on the front cover of Third Sector (16 August), which portrayed him skipping back to the City from his job as chief executive at New Philanthropy Capital. Exchanging the complex challenges of measuring social return for the more straightforward ones of economic return might indeed bring a spring to the step.

Martin has had a seminal role in placing questions of impact on the sector's agenda. This came in the right place at the right time, and resonated with emerging donor, policy and sector interests.

And it isn't going to go away. Payment by results is a central strand of the government's approach to commissioning. It has already introduced the social impact bond into the criminal justice system, with voluntary sector funding tied to success in reducing reoffending rates, and the approach is now widening out to youth and early intervention. In a paper published this month, New Philanthropy Capital again highlights early intervention as suitable for "an economic approach to giving", in which donors target problems generating the highest social cost.

Of course, effective social impact is what the sector strives for. But the challenges are vast. There are some relatively straightforward problems that can be tackled relatively simply and cheaply - literacy schemes, carer support, mediation services, community transport and vaccination programmes, for example. Such services hugely increase wellbeing and lend themselves to the sort of measurable outcomes and public savings that might support a social investment product.

But there are no simple cost-effective interventions for intransigent problems resulting from long-term and multiple causes.

At last year's voluntary sector research conference, Brookes commented that academic researchers shared responsibility for the sector's vulnerability to public spending cuts through failing to address questions of impact. He did not accept the methodological challenges and high costs of testing cause, effect and effective programmes, yet thousands of researchers face these all the time.

Yes, there is an easier way to produce results-based performance. It means tackling problems that are solvable, focusing on outcomes that are achievable and outputs or indicators that can be measured.

An important route to improving organisational performance is indeed the clarification of what can and can't be achieved.

But the sector's role has always been to address precisely those issues that society has found difficult to resolve - issues that require inputs at individual, community, and political levels, where the sector's input is only one in a multi-agency effort (for example, beating heart disease), where attitudinal or behavioural change involves improvisation, trial and error, and where the best outcome might be three steps forward, two steps back.

Cathy Pharoah is professor of charity funding at Cass Business School

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