Social Impact Investing

SOCIAL IMPACT INVESTMENT: BUILDING THE EVIDENCE BASE
pre-crisis only to pick-up again with increasing demand for low-income cash benefits following 2009. In
contrast, service spending has been steadily increasing.
5.35 Not all countries follow the OECD trend however. Australia, Canada and Germany (the latter
being a traditionally high cash spender) have all seen rates of cash spending fall over the period, whereas
Italy and Japan have seen marked increases in cash spending. In regards to services, all countries with the
exception of France and Germany have seen increases in expenditure of at least 1-2% of GDP or more.
Service spending has increased by close to one-third in Australia and the United States, and almost doubled
in total in Japan.
5.36 Although there is not much difference in service expenditure across the countries, three broad
expenditure groupings are clearly shown here. The European countries of France, Germany and Italy are
high spending countries, favouring cash expenditures. The Anglophones are lower-spenders but are more
balanced by type, to the point where in Australia, the United Kingdom and the United States, expenditure
levels are now favouring services. Finally, Japan is reporting stable upward trends across both spending
types.
Figure 5.7 Expenditure trends show services are taking up more of the social protection budget, in some case
exceeding cash spending
Note: Data report aggregate public social protection spending by type and do not include private social expenditure or education
expenditure (public or private), but do include housing and health spending. Data for 2011 are provisional. Service spending reflects
running costs of public services, cash spending reflects the value of cash transfers without administrative costs. OECD average is for
34 countries.
Source: OECD Social Expenditure Database, 2014a.
5.37 A limitation with Figure 5.7 is that it does not break down the social expenditure by sector, which
is an important task for the SII discussion because of the different sector-specific challenges to this type of
social entrepreneurship. For instance, one driver of the shift to greater service delivery overall is likely to
be demographic change. In the area of social protection there are generally high rates of service
intervention for the preschool years and end of life care, compared to higher rates of cash intervention
© OECD 2015 69