Updating Nordic welfare model: New financing models for social innovation and integration

There are many initiatives emerging from social innovators and entrepreneurs in the Nordic countries as a response to societal welfare challenges.

29 November, representatives from the public, private and third sector met in Oslo to discuss opportunities and constrains of establishing long-term sustainable projects addressing societal challenges. Focus was particularly on integration projects and there are already numerous social innovations that have contributed positively to integrating migrants in the Nordic welfare states. Other just as important focus was the issue of money: How can new financial models be part of this development in the Nordic countries?

Successful social innovators and entrepreneurs shared their stories. It has proven that cooperation on ‘neighbourhood economics’ and stimulation of new economic partnerships can mitigate segregation and exclusion of vulnerable groups.

State secretary Thor Kleppern from the Labour and welfare department, Norway, emphasized the importance for the public sector to overcome the fear to contravene in institutional regulations and rather focus on how to support the social innovators and entrepreneurs in implementing their ideas for solutions to address current welfare challenges.

Next year, Norway is hosting the chairmanship for the Nordic council of ministers and the focus will be on the development of the welfare state. The role of social innovators and social entrepreneurs will be on the agenda. The Norwegian parliament also committed to test and implement Social Impact bonds as a financial tool that focuses on social results. The new tool provides a new approach to improve the social welfare.

From Finland, Mika Pyykkö, who is Senior Lead in impact investing in SITRA (The Finnish Innovation Fund ), announced that a new project will be launched, which is focusing on integrating migrants and including them into the labour market. 50 million Euro are being invested by private investors to carry out a tailor made plan with the aim of reducing the time migrants become part of the Finnish labour market by half (from 3 years to 1½ year).

Research Fellow, Leneisja Jungsberg from Nordregio presented “Social innovation in local development”, a project commissioned by the Nordic working group on demography and welfare under the Nordic council of ministers. The outcomes show how local communities outside the capital regions respond to societal challenges in the Nordic countries. These collected 22 examples of Social innovation were gathered to inspire and share knowledge among the actors. An online database of the cases is available at Nordregio’s archive.