Social Policy Whisperer: Are health funding cuts a Second Front in the war on the voluntary sector?

In his latest Social Policy Whisperer column below, Prof. Paul Smyth from the University of Melbourne warns of growing risk to our society and democracy from an agenda to defund peaks and fund agencies only to deliver services – "no more no less".


It comes as the Federal Government opens up discussion about a new radical "co-payment" proposal - for public schools in Australia.

Tell me, is what is currently going on in Australia’s voluntary sector for real or just a nightmare? My last blog post showed how ‘contestability’ has emerged as a ruse to decommission the sector as a partner in democratic governance and transfer the public funds to (big) businesses to remake social service as a ‘quasi-business’. Last week Power to Persuade reported on $800 million dollar health funding cuts which will ‘drastically reduce the capacity of non-government organisations and peak bodies to deliver services across the country and to provide advice and support for reform in health’. Wouldn’t you have thought that the dismal fate of the Unfair Budget would have persuaded the government it needs a friend in the voluntary sector not an enemy?

Reports from insiders involved with the health cuts confirmed a new level of arrogance in government in its relations with the sector. Negotiators simply dismiss 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.

Pinch me! Is this for real? I would like to say no, but as Rik Sutherland of the St Vincent de Paul Society reported in his June blog post: ‘we have recently seen funding stripped from peak housing advocacy bodies, the reintroduction of what are effectively gag clauses in service contracts, and a move away from mission-based charities (most of whom also do advocacy) as provider-of-choice for government’.

But why is this such a big deal for the sector and indeed for Australian society? Rik gets it spot on when he continues that doing something about poverty and inequality takes a lot more than service delivery. It needs ‘structural’ changes to economy and society, ‘reforms (which) come about only through advocacy’.

Now you and I and Rik might think this is just common sense; but not so the neoliberal fundamentalists who are behind these attacks on the sector. For them, these ‘structures’ just don't exist. For them, advocacy, intervention, entitlements, rights are all bunk! The one thing needed is freely operating markets (with ‘quasi’ ones where they don't exist in the real world). No peaks, no advocates needed. Just sit back in silence and listen to the marvelous hum of the Price Mechanism bringing its endless satisfactions to customers, owners and shareholders.

Now the problem for the sector is that while the St Vincent de Paul and Pope Francis and just about everyone else in the world who matters don’t believe in this ‘trickle down’ fairytale, nobody seems to have told the fundamentalists in Canberra. No doubt they will get the message eventually but what is to be done in the meantime?

There are some really encouraging signs that the genuine voluntary organisations have seen the dangers of ‘mission drift’ and are reasserting that their commission is from their communities and not from government and planning accordingly. Thus Doug Taylor of Uniting Care NSW & ACT wrote in Pro Bono recently about ‘how NFPs can stop being “hollowed out” by Government’. They need to stop planning ‘on the basis of where they can get their next Government contract’, he says and look instead ‘at the community and discerning opportunities to meet unmet needs in line with their inherent mission and capability.

But beyond the individual agency it is vital that the sector as a whole hits back at this new and arrogant challenge to its role in creating a strong and vibrant democracy. Eventually the penny must drop in Canberra that the number is up for the fundamentalists. But if the market isn’t the answer to everything, what is the alternative? A Bureaucrat’s Plan? I don't think so. If we are to have a strong economy in a sustainable and inclusive society then mediating between the individual and the Planner must be strong and independent community organisations.

There is no doubt that over recent decades these vital social and political roles of the voluntaries became blurred with all the attention on issues of efficiency. However, under this new threat to the peaks it is time for them to articulate their unique roles that cannot be substituted by government officials let alone their ‘for profit’ mercenaries. Sooner or later the imperatives of inclusive growth will see them with an honourable place at the policy table.