Social Policy Whisperer: Renewing the Voluntary Sector in Australia-Part One

Today's post is the first instalment of a presentation by Paul Smyth at the Dunstan Foundation's Addressing Homelessness Conference (@DonDunston). With the conference subtitled Valuing the Homelessness Sector:  Humanity, Productivity and Building Futures, Paul's lecture explored the value in the community sector. Tomorrow's post explores how to start re-valuing it. 


My original title for this talk was ‘Selling Out Civil Society and what we can do about it’. I have changed it but not because the threat of a sell-out is not real. Let me assure you that it is deadly serious.   My brief was to reflect on the role of the voluntary sector in ending homelessness in Australia. The reality is that if people don’t take action now there will be no voluntary sector in the homeless space. Or, if there is, it will be so residual that its impact on society will be minimal. I will substantiate this claim by an examination of the marketization push which has over taken sector reform in the last year or so. I have changed the title to highlight just how out of step this policy is with a society seeking a new economic model oriented to the reduction of inequality and the promotion of a truly civil society. I will conclude with some ideas on how the sector might use this movement to lay the basis for the renewal of the voluntary sector and thereby Australian society itself.

Selling off Civil Society

A couple of weeks ago at a meeting of the Australian Catholic Social Justice Council one member reported that in NSW so called homeless sector reform had led to the elimination of many the community based agencies. Notwithstanding the fact that a senior political figure was appalled by the decision and a senior bureaucrat apologised for the whole process, it is fast becoming a national trend.

Last year, after the launch of Ian Harper’s National Competition Policy Review I wrote a paper called ‘The Lady Vanishes …’ warning how the proposed plan to marketise education, health and welfare would see the voluntary sector disappear into a human service market dominated by mega for profit agencies. This followed the Brotherhood of St Laurence’s Tony Nicholson’s speech pointing to a similar outcome from the implementation of the Shergold report on the sector for the Victorian Government. Make no mistake, these two policy exercises have proved part and parcel of a new and radically stupid agenda to shrink not just the government but the community sector in a push to replace the social services of the solidarity state with a human services market.

Before this policy turn there were good reasons to believe that government- community sector relations were on a renewal path. The Rudd and Gillard governments had reaffirmed the sector’s advocacy role which had been placed in jeopardy in the Howard period. The PC report of 2009 had declared the limits of Hilmer type market based funding and urged experimentation with new regimes more appropriate for the sector. The creation of Australian Charities and Not-for-Profit Commission has also been providing a new national focus for developing a stronger sector profile. Though never clearly articulated there was throughout this period a strong implicit assumption of a distinctive role of the voluntary sector which was complementary to that of government and market.

However with the Shergold and Harper initiatives the old itch for marketization has returned in an ideological rash. With an eye to the ‘unfinished business’ of 1990s micro economic reform i.e. education, health and welfare, there has been a clamour to draw the sword on all those providers hiding behind assumptions of a sector with a unique social value add that needs to be protected and fostered by government. Social services must be seen as no different to any other commodity and should therefore be fully contestable in a competitive market open to the private sector. It’s really all very simple - just follow neoclassical economics 101.

Everyone in the sector will be familiar with the new messages now emanating from governments both state and federal. As David Tennant of Goulburn Valley Family Care (click here for paper) recently summarised:

  • we want more openings for for-profit providers
  • get big or get out
  • start to look elsewhere for funding e.g. through quasi-investment markets

And the messages have been backed by action. First there was the slash and burn of the DSS funding round at the beginning of the year, while the march of the mega for profits was plain for all to see in the letting of the employment service contracts with agencies such as the US company Maximus firmly established as the major providers. British based Serco already established in prisons and the Fiona Stanley Hospital is reportedly lining up for the NDIS market. No wonder Tennant titled his paper, ‘Once upon a time there were Regional NfP Community Service Providers’.

And the new agenda is not just about a nostalgic passion for market efficiency. It is also about discouraging the idea that the sector has any distinctive role that might be compromised by this marketization. As the ACTCOSS and SACOSS report on ‘Independence for the Not-for-Profit Sector’ shows there is an active discouragement of independence which is wholly at odds with previous understandings of the sector’s role in contributing to democracy, policy development and civic engagement more generally. Indeed in recent discussions of the impacts of funding cuts to health services, government negotiators are reported to have simply dismissed the idea that peak voluntary bodies play a vital role in connecting government into the lives of citizens. It is openly said that the new agenda is to defund peaks and fund individual agencies only to deliver services – no more no less.

The political origins of this attempt to sell off the civil society agencies remain something of a mystery. In the 1990s it was obvious how the microeconomic reform agenda came about. It was openly espoused by the political leadership, strongly backed by senior figures in academia and with bureaucrats who could be quite credible even if you did not always agree with them. Today while Shergold and Harper have fronted up inquiries it is extremely hard to find out who is actually behind selling off the community sector. Anecdotally federal ministers are said to fully appreciate its wider contribution, bureaucrats confess to a shakeup but never a full on marketization, while I have never seen any Australian academic great or small espousing such a thing.

The only resonance people have found is with the radical liberal ‘Big Society’ agenda of the UK government designed to permanently undo the social policies and institutions of the welfare state. Australian conservatives certainly tried to follow the UK assault on people on welfare with their first budget and we know what happened to that. Perhaps this simultaneous and unexpected attack on social services and the community sector is simply getting through under the radar because in the short run fewer people are immediately affected.

But if the case for marketisation is so weak and its real champions have to lurk in the shadows one has to ask why there hasn’t been more effective resistance? Part of the problem has been that we have all tended to see this as a problem for the sector itself. I am not the only one who has concluded there diagnosis of the problem with an exhortation to the sector to go and get itself sorted out. Agencies should revisit their mission, not be focussed on just growing the business and so on.   But now we need to see that this is not primarily a sector problem. Its role is entirely interdependent with those of the market and of the state. So before we consider what needs to be done to promote the sector we have first to look at it within the big picture of state, market and civil society in Australia today.

Society and Social Policy

Of course whenever you say this will be a big picture exercise then you worry that eyes will glaze, heads will nod while people reflect inwardly on more immediate concerns. But don’t, because in this case the big picture is the immediate concern. If you are in doubt try and answer me this question: what is the unique value add of the community sector? Hard? A key reason why the sell-out is happening is the fact that most of us can’t give a simple account of the kind of society we want and why it necessitates a critical role for the organisations of civil society.

In my own case I would say I have spent the last three decades trying to understand neoliberalism and work out what was wrong with it from a social policy point of view. I think I learnt a lot about economics but I never thought about the kind of alternative society I would actually prefer; that would have truly been a waste of time. Now as we enter a period when neoliberalism itself is going off the rails I have been startled to find how difficult it is to think about an alternative society and the social polices needed to achieve it.

This is actually quite odd because when I did my undergraduate studies in the 1980s in social policy no one took the slightest notice of economics and they hadn’t for forty years. Rather we studied alternative types of society and the policies needed to achieve them. Then as the fiscal challenges of the welfare state drove a preoccupation with economic efficiency we simply stopped talking about the actual goals of policy and the social policy space became colonised by economists whose claim to expertise lay not in social policy goals but in the secondary question of the most efficient means to achieve them. But this new radical agenda of selling off civil society goes beyond questions of efficiency to changing the type of society we want to achieve. To really engage with the renewal of the voluntary sector then we must first go beyond questions of economic efficiency and open the question of the kind of society we want.

So what ideas of society did people have in the decades preceding this narrowing of focus to efficiency? The idea of a welfare state was of course the centrepiece. But what was it all about? Going back to the great social policy thinkers writing on the eve of the welfare state, like R H Tawney and Michael Polanyi, what I found most interesting from a present day perspective was the way these writers actually upheld the great Enlightenment ideals of individual liberty and its twin the free market economy which had broken through in the French and American revolutions. They did not dispute the revolutionary value of individual freedom or the market economy but rather the ways in which these had been undermined by the gross inequalities and class systems arising amid the industrial revolution. The social policy aspiration became the creation of a truly Civil Society through promoting an equality of circumstance necessary for individual freedoms to be realised (see Rosanvallon 2013). Differences of emphasis had given these societies different names: social liberal, democratic socialist, ethical socialist and so on. But their broadly common aim was ‘a society of equals’ in which all citizens contributed to the creation of a shared, common ‘civilisation’ (‘civilising capitalism’).

Importantly for the Voluntary sector the necessary collective action could not be concentrated entirely in the state (cf fascism; communism) but had to be via a state working though intermediate, free, social associations.   This ‘social sector’ ranged across the economy and society including employer associations, trade unions and professional associations as well as charitable organisations and educational and training institutes and were as much concerned with good ‘economic’ as much as ‘social’ outcomes. The two went hand in hand. For Tawney each of these ‘sectors’ were important for fulfilling the different ‘functions’ necessary for the creation of a Civil Society. For Polanyi this corresponded to the idea of different ‘vocations’ for which the sectors needed to take responsibility through their own professional associations.

Society and the Welfare State

Especially around the middle of the twentieth century there was a huge growth of social investment in public education, health and welfare. With the associated taxation this helped propel the ‘great convergence’ of incomes and wealth noted by Picketty and Andrew Leigh.  Around this time T H Marshall (1981) produced his classic analysis of what had come to be termed ‘the welfare state’ in terms of the progressive development of the civil, political and social rights of citizenship. Like Tawney and Polanyi, Marshall’s Welfare State aimed to combine the ambitions of liberalism and the market economy with a social system geared towards that social equality needed to underpin true freedom.

For our purposes, what is really important is the way in which he explained the need for the proper functioning of different but interdependent sectors if the overall goal of a civil society was to be achieved. Calling it the identified the components as a democracy, a mixed economy and a welfare state. Properly understood, he said, ‘the sectors enjoy a measure of autonomy derived from the power inherent in their axial principles…. (Each) can invoke an authority independent of, and arguably equal in status to, those invoked for the other two’.

The reason we need a social sector independent from and equal to the economy, according to Marshall, lay in the view that ‘the market value of an individual cannot be the measure of his (her) right to welfare’ in a solidarity state which assigns every citizen equal value. In such a society, wellbeing can never be the ‘summation of market preference’. And these different axial principles, he says, require different modes of organisation to achieve their respective goals (cf market, bureaucracy, voluntary sector) and with different kinds of personnel (cf community volunteer, bureaucrat etc.).

Now while the distinctions between the sectors can sometimes be obscured in practice (but education, health and welfare are most definitely in the solidarity domain), Marshall warns not to blur the differences: ‘the hyphen links …different and contrasted elements together to create a new entity whose character is the product of the combination, but not the fusion, of the components, whose separate identities are preserved intact and are of equal contributory status…The tie is unbreakable except by the destruction or degradation of one of the partners…’Importantly he talked about the importance of respecting the integrity of each system and not allowing one to collapse into another even while allowing for the tensions which would arise through the different values upon which each system was based e.g. accounts of equality\ inequality.

This presentation was originally delivered at the Dunstan Foundation Addressing Homelessness Conference. 

Posted by Sarah Toohey