Financing for Development: act now to reduce health impact of road crashes
The true health costs of global road traffic injuries must be recognised in order to generate sufficient international catalytic financing for road safety to kick-start and support effective national strategies in low and middle income countries.
The call comes in a series of policy and research papers published by the FIA Foundation as part of a ‘Financing for Development’ series coinciding with the 3rd International Conference on Financing for Development, taking place in Addis Ababa. More than 1.2 million people are killed and up to ten million seriously injured on the world's roads every year, making road traffic injury one of the world’s leading health issues.
In an introductory paper to the series, ‘Financing for Development: Catalytic Financing for Global Road Safety in the SDGs’ the FIA Foundation argues that delivering the new road safety targets included in the post-2015 Sustainable Development Goals (SDGs) will require a significant increase in international donor support for global road traffic injury prevention, from sources including bilateral donors, public health philanthropies and the private sector. The report calls for the replenishing of an existing fund – such as the Global Road Safety Facility, housed at the World Bank – or launch of a new global fund to meet the challenges of the SDG era, and for closer alignment with existing and new mechanisms and fora designed to deliver financing for the SDGs, including the new ‘Global Infrastructure Forum’ agreed as part of the Addis Ababa Action Agenda. The report also highlights the potential of ‘innovative financing’ to meet some of the global and national road safety funding demands, pointing out the success of the UNITAID transport levy model for financing HIV/AIDS, Malaria and Tuberculosis prevention.
One form of ‘innovative financing’, social impact investing, could herald a new era of safer road investment by making transparent the links between road safety measures and public health outcomes, according to a new report by Social Finance and Impact Strategist, two leaders in policy development in the burgeoning 'payment for success' Social Impact Bond (SIB) market. The report, published as part of the FIA Foundation ‘Financing for Development’ series, argues that private sector financing through a road safety Social Impact Bond framework could bring new funding sources and new rigour to transport investment within countries. The funding for the Social Impact Bonds is provided at risk by social investors whose financial return is aligned to the positive social impact of meeting pre-agreed social outcomes.
The Social Finance/Impact Strategist report, ‘Breaking the Deadlock: A Social Impact Investment Lens on Reducing Costs of Road Trauma and Unlocking Capital for Road Safety’, highlights the need for increased financing for global road traffic injury prevention to achieve this target, but points out that significant improvements could be made if the billions of dollars of existing road infrastructure investment is deployed with the priority objective of realising social and financial savings from reduced injuries and fatalities.
Structuring Social Impact Bonds with clear metrics measuring the effects of road safety policies - such as safe infrastructure design or enforcement campaigns - on specific health outcomes (e.g. reduction in number of hospital bed-days relating to road traffic victims) could 'break the deadlock' of decades of transport policy and planning divorced from consideration of public health outcomes.
The report makes a number of recommendations to advance SIB development in the area of road safety and encourages stakeholders including governments, multi-lateral development banks and financial institutions to support ‘steps to action’ including:
- Identify projects currently in development which could serve as a demonstration of how the social impact investment approach could be applied in the road safety context;
- Design a methodology and toolkit for collection of data, with the aim of filling out the ‘missing piece’ to demonstrate who (for example in health systems or the insurance sector) bears which costs and to build an evidence base relating to particular interventions and outcomes achieved;
- Develop a road map to progress from illustrative models to advocating for and developing options that will deliver ‘Safe System’ change at scale.
Report authors Rosemary Addis, Director of Impact Strategist and a member of the G8 Social Impact Taskforce, and Jane Newman, International Director of Social Finance, said: “Social impact investing provides an exciting option to ‘unlock’ the benefits of improving road safety. This work sheds light on who bears the cost now and the incentives to invest in prevention rather than dealing with the consequences of road trauma which affect millions of people around the world”.
A third report report released as part of the ‘Financing for Development’ series looks in more detail at one specific area of innovative financing, examining the potential of corporate ‘micro-donations’ to deliver new funding sources for global and national road safety efforts. Based on research amongst corporate leaders by management consultancy Price Waterhouse Coopers (PwC), the report ‘In for a Penny: Can micro-donations benefit global road safety?’ finds that micro-donations could have a role to play in financing global road safety and, although it may be ambitious to expect multiple companies to collaborate on one global scheme, the aggregate effect of several schemes might deliver fairly significant additional funding.
The PwC researchers conclude: “Our discussions with corporates that may have interest in road safety highlighted potential difficulties in implementing this type of scheme in terms of principally the perceived complexity of setting up and managing a scheme and in relation to their business models. Discussions also highlighted that corporates would typically look for more from a charity partnership than a single scheme – the most common requirement being the potential for staff involvement. Our research also suggests that if a consumer micro-donation scheme is a focus for corporate approaches careful targeting and research will be critical. This may include identifying corporates with simple, repetitive transactions, chain store operating models, road safety conscious consumers and a strong brand. In addition a clear and concise impact story of the donation remains as critical a success factor for micro-donations as it does for all fundraising.”
Alongside the PwC research, the FIA Foundation published creative ideas for a global road safety micro-donation campaign produced by award-winning brand agency The Partners. The PwC research and the creative ideas are intended to stimulate and encourage exploration of alliances between road safety funds, NGOs and potential corporate partners. The report recommends that the private sector has an important role to play in supporting global road safety.
The FIA Foundation announced the ‘Financing for Development’ research series at a road safety event hosted by the United Nations in Addis Ababa, as part of a panel including officials from the World Bank and the African Development Bank. The FIA Foundation’s Director, Saul Billingsley, said: “Through this ‘Financing for Development’ series, the FIA Foundation is contributing to an urgent and necessary debate on the way forward for catalytic global road safety financing. Re-structuring of existing funds or establishing of new global road safety funds, identifiation of new and increased sources of funding, and more effective partnerships with relevant major SDG financing mechanisms are all priorities as we prepare for the SDGs. The FIA Foundation looks forward to working on these issues with many partners, including through the fundraising initiative planned as a key deliverable of the planned new FIA-led High Level Panel on Road Safety.”
“But in addition to sourcing and effectively deploying new international catalytic financing, we also need a paradigm shift in the way national transport funds are invested. For too long there has been a disconnect between road and urban transport provision and the effect this expenditure has on public health. As we prepare to implement the new SDG road safety target we need a game-changer, a new way to transparently measure and reward safe and sustainable transport investment. For example, designing a SIB investment for safer road infrastructure design which pays investors for a successful reduction in injuries would be a win-win for transport and health ministries. We are wasting far too much money mending broken bodies in trauma wards when the solutions are available to save lives and make roads safe."
Financing for Development: Catalytic Financing for Global Road Safety in the SDGs
Breaking the Deadlock: A Social Impact Investment Lens on Reducing Costs of Road Trauma and Unlocking Capital for Road Safety
In for a Penny: Can micro-donations benefit global road safety?
Outcome document of the Third International Conference on Financing for Development: Addis Ababa Action Agenda