Fears that private companies might take over the supervision and care of young beneficiaries have eased, as Maori and other community providers appear to have won contracts for the work.
Iwi organisations have been named as preferred bidders in Gisborne and part of Northland, and most existing youth transition service providers elsewhere are negotiating to expand their services in the first phase of the Government's radical welfare reforms.
Most will take the new role of working with all teenagers on youth benefits and youth parent payments from July 30, as well as continuing to help at-risk school-leavers to find work or training.
Council of Christian Social Services executive officer Trevor McGlinchey said the outcome was a welcome acknowledgment of the value of non-profit services. "My concern was if you did something to see commercialisation of social service providers in terms of for-profit activity," he said.
At least one Australian company was rumoured to be among more than 150 organisations that bid for the new contracts.
The Salvation Army also bid for a single national contract, and the YMCA tendered for seven of the 11 Work and Income regions, but both have missed out.
Whangarei-based Ngati Hine Health Trust bid for the whole of Northland and has been identified as a preferred bidder, but the area it will get is being negotiated.
People Potential, the existing service provider for school-leavers in Whangarei, has not heard yet whether it is also in the running.
Auckland has been divided among four agencies: Youthline, Youth Horizons Trust and the Manurewa-based Solomon Group, which held the three existing school-leaver contracts, and Mangere-based Strive Community Trust, which is expected to work with up to three Work and Income offices.
Whai Marama, a division of Te Runanga o Kirikiriroa (Hamilton) which runs the existing Waikato service, is negotiating to provide the expanded service for the whole of Waikato, including Otorohanga, which has run its own service.
Mayor Dale Williams said Otorohanga would keep its own school-leaver and apprentice support services with separate funding from a Work and Income regional fund and the Otorohanga District Development Board.
"No disrespect to Whai Marama, but the reason we set up our own service is that even though technically they were covering us, they were not," he said.
Rotorua's Te Waiariki Purea Trust is negotiating to continue services in Rotorua and Taupo but has lost contracts for the eastern Bay of Plenty.
The existing provider in Gisborne, Career Connexions Tairawhiti, did not bid for the new contracts because it was unwilling to take on a "policing" role of reporting on young people who failed to carry out obligations to undertake training or apply for jobs.
"It wouldn't allow us to do what we can do here, which is get alongside young people," said director Geoff Meade.
The contracts are expected to go to two local iwi, Te Runanga o Ngati Porou and Te Runanga o Turanganui a Kiwa.
Salvation Army social services manager Major Pam Waugh said the army was one of several preferred providers in Hawkes Bay.
Existing providers negotiating new contracts elsewhere include Tui Ora in Taranaki, Start in Manawatu, Vibe youth health service for Hutt Valley and Wellington, and Working It Out in Southland, Otago and North Canterbury.