Juan Manuel Restrepo

Social Innovation and the Colombian Government

Editor’s note: This post originally appeared on NextBillion en Español.

“The challenge of social innovation is to unite innovators and make them work as a team.”

-Samuel Azout

Samuel Azout is an economist who has worked in the private, public and social sectors in Colombia. In 2010, he served as High Presidential Advisor for Social Prosperity and later as director for the National Agency for Overcoming Extreme Poverty (Agencia Nacional para la Superación de la Pobreza Extrema, or ANSPE) until 2013, where he designed policies to reduce inequality and poverty rates in Colombia. While at ANSPE, he participated in the creation of the Centro de Innovación Social (Social Innovation Center), one of the few in the public sector agencies to promote social innovation worldwide.

I spoke to Samuel to get to know the process of social promotion and innovation better, from the standpoint of the Colombian Government.

Juan Manuel Restrepo: Why did the Colombian Government decide to promote social innovation?

Samuel Azout: Today, Colombia is perhaps the country with the highest incidence of poverty and extreme poverty, when compared to countries with a similar median income according to GDP per capita. The GDP is not well distributed. The result is that, despite good economic growth in the past years, poverty has not been significantly reduced.

This prompted President (Juan Manuel) Santos to begin questioning why there was no trickle-down effect, in which economic growth is necessary but insufficient. It was time to implement public policy to ensure better distribution and to address those human issues we face in Colombia.

Juan Manuel Restrepo: What changes took place in Colombian institutions to promote social interaction?

Samuel Azout: President Santos created the High Advisory for Social Prosperity in 2010 basically to redefine public policy for social development. This developed the Social Prosperity Program and its elements.

(Those elements include:

1) Investment in early childhood education

2) Working with the private sector

3) Creating an institutional architecture through the Department of Social Prosperity (Departamento de Prosperidad Social, DPS 4) Focus on extreme poverty through ANSPE and

5) Creation of the Center for Social Innovation.)

… the development of a new institutional architecture is by far the most important aspect. Colombia did not have a social inclusion and reconciliation sector until the Department of Social Prosperity (Departamento de Prosperidad Social, DPS). Its main focus is extreme poverty through ANSPE, part of the DPS. However, ANSPE must be terminated within ten years. Within ten years, there should be no extreme poverty in Colombia.

Another point is social innovation; the national government decided to create the Center for Social Innovation. This is because humanity as a whole, and not just Colombia, has not been able to overcome poverty. Today, there is more extreme poverty, when taken in absolute numbers. In 1800, there was 88 percent poverty in a world with one billion inhabitants. Today, there is three times as much poverty as there was 200 years ago. We’re not doing very well.

JMR: What are some of the things you have learned from this process?

SA: We really need to try alternate formulas. Many of the problems we see stem from the fact public policy is being designed from above.

The government has a sectorial agency, and those are mostly functional, so it’s Housing vs. Housing, Health vs. Health, Education vs. Education. There is no one single program that collectively addresses poverty as a multi-dimensional issue. Of course, housing is important, but still not enough. Microcredit is important, but it’s just microcredit. The point was understanding there is yet another issue. Passing a law will not solve poverty. Handouts are not going to solve it either.

To move out from this handout system, we must realize that individuals need to have a desire for self-improvement. We must include each individual one by one. Even if they look alike, whether it’s a slum or a favela, each individual faces an individual trap. This is why policy needs to address poverty specifically. Massive individualizing is required. This must be done at a completely individual level. That is what the Unidos Network (National Agency for Overcoming Extreme Poverty) intends; to articulately connect families with the state’s and the private sector’s social services through social managers.

JMR: Why must the government seek solutions abroad?

SA: … There are people in communities who develop many solutions with no visibility, no support, and with little option to escalate into a public policy. Innovators can’t find a space for implementing their model at a larger scale and impact.

What the Social Innovation Center intends is to map these innovators, offer them visibility, and find financing for the good ones to escalate. This is how work done top to bottom can be complemented with work done bottom to top.

The government needs to helm, but not necessarily row. It’s important to join forces with those who know, and those are the social innovators. The magic of development includes addressing everyone involved. The government cannot do everything on its own. It just can’t. It lacks both resources and knowledge. It has the strength of policy, but it’s not so good at intervention. It’s slow and bureaucratic, and so, it needs cooperators full of ideas.

Governments aren’t very good to come up with ideas, either. The government has no competition. The Ministry of Housing has no competition, the Colombian Institute for Family Welfare has no competition, and thus, they lack innovation. Innovation needs a boost, and the private sector knows about profitability and efficiency. The private sector knows about productivity. The private sector even knows about scaling. Thus, we also need the private sector’s know-how.

It’s about integrating competences in each sector. No sector can be an island; a good coordination system is required. This is why at ANSPE, the private investment group, works together with the social innovation group.

JMR: How does the government coordinate these actions?

SA: The Unidos Network is committed to a cross-sector initiative where 30 entities are involved, among which are all ministries and other state agencies. At this point, public and private offers are coordinated with non-profit organizations.

This cross-sector meeting point allows presenting social innovation programs to afford them visibility. For health, there is the Ministry of Health, for housing, the Ministry of Housing … and for microfinance there is the Banca de Oportunidades (Bank of Opportunities). It’s a space for discussion, and this has become a larger challenge for the government. How can the government carry out this cross-sector work within the government but also with other sectors of society? This is where mistakes are being made.

Because the plan for housing is not a real plan for housing. What we are forging are communities. Communities have other constituents. They have health, education and family dynamics. The solution cannot be housing only, or microfinance only, or micro-entrepreneurship only. It must be a combination of different proportions for different families in different regions. There always is the temptation to come out swift with an “I’ve got the solution”.

What’s important is to understand that the issue of poverty is not caused by one single thing, and this requires a lot of coordination, and that’s exactly what we lack. The challenge of social innovation is to unite innovators and make them work as a team.

JMR: In this scenario with so many actors, how can you make them accountable?

SA: Accountability is quite a delicate issue in a government. A lot is measured in invested money, signed contracts, amount of beneficiaries. Those are all outputs, although not real impact.

We are not that well advanced in impact evaluation, but the Center for Social Innovation has specific goals in the ANSPE. When ANSPE goes about its planning, it must meet a number of achievements from the Unidos Network. How many families have improved their residence. or have access to drinking water or basic sanitation. In the Unidos Network, effective achievement it measured.

And it’s quite tough to measure. It’s the general challenge in the social sector. How do you measure impact? Let’s say you want to invest five thousand dollars in stock. There’s the analyst, you can look at the P&L report and so on. You can’t really tell in the social sector.

If the government intends to reduce dropout, they can improve schools, train parents, donate computers, start a soccer program, improve nutrition or donate shoes, but they cannot affect impact itself. It needs to conduct experiments, such as those of Esther Duflo at the Poverty Action Lab.

Realizing all this shows us that the social sector is quite entertaining, but also layered and complex.

Impact Assessment