Potential and Limitations of Innovative Finance for Early Childhood Education: The Case of Early Childhood Education Outcomes Funds

• In Event: Investing in Early Learning: Exploring Innovative Financing in Early Childhood Care and Education

Proposal

Quality early childhood care and education (ECCE) has the potential to greatly enhance foundational learning outcomes and long-term educational attainment. Despite its transformative impact, ECCE remains critically under-financed. The dual challenge of securing increased financing for ECCE while ensuring quality at scale continues to present significant obstacles for ECCE advocates in government agencies and the global ECCE community. While the urgency of increasing investment in early years through public financing and official development assistance is clear, there is a growing need to explore innovative financing mechanisms that can diversify funding sources and enhance quality at scale.

One such mechanism is the outcomes fund, an innovative financing mechanism that contracts multiple implementers to achieve predefined results, with payments contingent upon the achievement of these results. One such outcomes fund has been at the forefront of pioneering outcomes funds for ECCE, forging multi-stakeholder partnerships and collaborating with governments to establish ECCE outcomes funds in Rwanda, Sierra Leone and South Africa.

The presentation will share key findings and insights from the design of ECCE outcomes funds, as captured in a series of technical papers on measurement tools, evaluation methods, disability inclusion, and cost analysis. The findings put forward in these papers are based on data collected through interviews, document reviews, and participant observation. The presentation will contextualize these technical insights with real-life examples that illustrate the challenges of building and sustaining multi-stakeholder partnerships, and of making design decisions in the face of uncertainty. By sharing both technical insights and candid reflections on the practical challenges of implementing outcomes funds for ECCE, this presentation will contribute to broader discussions on the role of innovative financing mechanisms in advancing quality ECCE.

Author

• Ozsel Beleli, The Education Outcomes Fund