Since the central Croatian town of Petrinja was destroyed by a series of powerful earthquakes in December 2020, partner cities from the URBACT CityCentreDoctor network (2016-2018) have reacted quickly to send emergency support – more than two years after working together to revitalise their city centres.

“URBACT created personal relationships between people from different towns and created a living network that has brought vital support at this difficult time,” said Petrinja resident Nina Ficur Feenan who has been helping with communications between her town and URBACT partners. “Such solidarity is a bright light during what has been a very dark crisis.”

“The 6.4 magnitude earthquake on 29 December 2020 literally shook us from our foundations,” Nina said. “Seven people lost their lives on that day and one rescue worker also died later. Thousands lost their homes. The town does not exist anymore. Hospital, ER, schools, shops, banks, hairdressers, florists, cafes, restaurants, market, museums, cinema, boutiques, bakeries, butchers... it's all gone.”

“Everything that makes a town is gone. It is hard to perceive that level of devastation.”

Petrinja main square after the December 2020 earthquake.

Small-city solidarity

Despite the Covid-19 crisis, Petrinja’s former network partners – all small cities roughly the same size – reacted quickly with solidarity, practical support and funds. “They have a connection with Petrinja and have walked on our streets that have been devastated by the earthquakes and can, maybe, better understand the situation we are in,” said Nina.

In the Irish city of Naas, Mayor Fintan Brett first heard about the quake on the CityCentreDoctor WhatsApp group where the 10 partner cities still share news, ideas and encouragement on their town centre improvements. He decided to take action. “What do we do? Just look at them? Or get up and do something?”

With support from the Naas ‘town team’ – a continuation of the URBACT Local Group formed during the URBACT project – Fintan worked closely with Majella O’Keeffe of Naas Access Group to launch a gofundme appeal for Petrinja’s municipal council. Donors include Irish ambassador Ruaidhri Dowling, who is supporting efforts in Croatia. They also went a step further, mobilising hundreds of Naas residents and businesses to donate food, warm clothes, building materials and other items requested by Petrinja, including goods for people with disabilities. With logistics support from the council, volunteers packed these into a 45-foot container for shipping.

Volunteer local truck driver Paul Kennedy transported the donated goods to Croatia in the last week of January.

Daniele Terzariol, Deputy Mayor of San Donà di Piave, the Italian city that led the CityCentreDoctor network, also reacted quickly to the WhatsApp alert. Helped by the Italian National URBACT Point, he launched a fundraising appeal to all Italian cities in URBACT networks, past and present, encouraging them to send funds directly to the Municipality of Petrinja. His municipality also decided to make a donation, as did URBACT local partners in Heerlen (NL). Meanwhile, Radlin – a Polish city with a population of under 20,000 – also sent a shipment of goods.

Daniele sees Petrinja as a ‘sister city’ that “needs the support of all of us in order to make the reconstruction and support of citizenship as fast as possible”. He said: “The earthquake that hit Petrinja caused the devastation of the city centre and neighbouring villages: as colleagues, friends and partners we cannot sit still without actively supporting the people who live in those places.”

Lasting positive URBACT relations

This welcome response in a time of crisis is just one example of how URBACT cities across Europe often keep up close links beyond the completion of their networks. CityCentreDoctor URBACT Expert Wessel Badenhorst attributes this lasting solidarity to the way URBACT guides cities to work together through an intensive two-year process, while leaving flexibility for meaningful personal connections to develop. He said: “This earthquake crisis is an example of how resilience can be gained from being part of a network that took two years of intensive development.”

“Today we’re still all friends and we’re happy to keep our relationships strong and vital,” said Daniele. “URBACT networks and all the European projects are based on the values of solidarity and union and increase mutual knowledge based on common roots.”

Badly damaged by war in the 1990s, as Petrinja sets out on a battle to rebuild yet again, Nina Ficur Feenan says: “We appreciate all the help and support we can get from our friends and partners as well as from strangers and friends we haven't met yet.”

Interested to support Petrinja directly?  Find details of how to donate on the official city website.

Cover photo by Nina Ficur Feenan on Flickr

Total government expenditure in the EU-28 decreased from 50% of GDP to 45.8% between 2009 and 2017. Similarly, local government spending fell from 12% of GDP to 11% between 2009 and 2015. Still, demands on services have remained intense, and spending on social protection as a proportion of total expenditure increased from 38.8% to 41.2% and spending on health increased from 14.7% to 15.3% in the same period. Cities provide many of those services, -and doing so while running on tight budgets causes significant strain.

Besides shrinking budgets, providing effective services fail because they are often split between different departments, and a holistic approach is lacking. Cities are pressured to allocate resources to solving crisis-point situations instead of spending on prevention. In such a context, decision-makers opt for the business-as-usual approach without risking relatively unknown interventions that have a severe upfront cost.

In the meantime, the idea of ‘socially responsible’ or ‘impact investment’ is emerging amidst a low interest rate environment. The trend of investing in the social environment has become a way for investors to give back to the community. Very often, companies are trying to expand their social responsibility. As a result, a growing number of investors are looking for forms of impact investments as a way to stand up for their beliefs and also make a profit.

The relatively new tool for bringing together the investor and the public sector is the Social Impact Bond (SIB). It is a contract whereby the public authority or governing authority pays for better social outcomes in certain areas and passes the savings achieved to investors. Unlike a bond, the repayment and the return on investment are contingent upon the achievement of desired social outcomes. If a project meets the pre-agreed results, i.e. an improved social outcome that generates a cost-saving, the government (this can be local or national) pays the investors. If a project does not achieve its contracted results, the investors lose their money, and the government pays nothing.

1. Figure: Social Impact Bonds’ theory of change. Source: University of Oxford, Government Outcomes Lab - An Intro to SIB.

A Social Impact Bond may have many beneficial effects for cities, as Government Outcomes Lab states in its Evidence Report titled ‘Building the tools for public services to secure better outcomes’. It encourages collaboration by building on cross-sector expertise and bringing together multiple commissioners and multiple providers. It unlocks future savings by investing more up-front, enabling cities to focus on prevention and early intervention services that might otherwise not get funded. A SIB may inspire innovation by allowing new interventions and more flexibility. It also levels the field for involving voluntary, community and social enterprise organisations. Last but not least, a SIB can improve performance management and provides a better quality of evidence.

Many critics are contesting these benefits, saying that a SIB does not encourage genuine innovation. Investors will be looking for low-risk models that have been proven to deliver, as they want their money back. Moreover, a SIB is expensive to develop and leads to the financialization of the public sector, which is – for many - incompatible with the public service ethos.

With evidence on both sides, Social Impact Bonds need more experimentation and evaluation. And despite these circumstances of austerity, some cities try to use the momentum to shift their approach towards this new tool. That is why 10 cities joined their forces in URBACT SIBdev Network to jointly explore how Social Impact Bonds, can improve public service delivery. The tool and the URBACT methodology, namely coproduction through multi-stakeholder local support groups and the development of local action plans fit perfectly.

The network will examine service delivery concerning employment, ageing and immigration. Employment is an obvious choice since SIB is particularly well-suited to it, as demonstrated by the fact that it is the most common type of SIB worldwide. Ageing is the most massive pressure on social spending in Europe and affects a growing number of people, while immigration is the primary concern at the EU level (according to Eurobarometer).

Is SIB going to be the new secret tool for providing adequate public services? Maybe it will be, maybe not. But it certainly is a promising new form of commissioning social services. If you are interested in Finance and/or Social Services, follow URBACT SIBdev Network to learn about how SIB might work for you!

1. Photo: Harrie Lambrichts