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Home / New Zealand

<i>Tim Howard:</i> Business model neglects 'flaxroots'

By Tim Howard
NZ Herald·
13 Aug, 2008 05:00 PM4 mins to read

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Opinion

KEY POINTS:

The stories of the elusive John Key are starting to come out. The state-house-to-millionaire story, the mother escaping from Nazi Europe.

Better to ask: what is Key planning to do? Specifically, what is National's plan for social services?

Social services, and the wider tangata whenua community voluntary sector,
have been left guessing. But there are hints.

What does Key mean by "turbocharging" the sector? Favouring a corporate culture in the sector?

Bill English has been understood to favour reducing government relationships with the sector to a few large contracts.

National has openly spoken of Public Private Partnerships (PPPs) - in ACC, roading, broadcasting, prisons. Corporate culture and economics are likely to blunt the best of what the not-for-profit sector has to offer.

Key has been quietly floating a model for the sector in the form of a large corporate entity, a "super contractor". He has linked this concept with Mission Australia, which National brought to New Zealand for discussions on "work-for-the-dole". But their broader interest to Key is worth considering.

Mission Australia was formed from six church-based social services missions 10 years ago. It is a sizeable corporate-style organisation - employing about 3500 people, with 300,000 "clients", and an annual turnover of around A$250 million. It thrived under the Howard Government.

Its board members come from major accountancy, merger management, corporate recruitment, property and investment firms. While Australia is ethnically diverse, board and management reflect "White Australia".

Its partners are also from large corporates or their foundations. A key partner is the foundation set up by the large international banker Macquarie Group Ltd (it appears that Key's main mentor is Jim McLay of Macquarie NZ; and that Key has been talking with Macquarie about building our public hospitals and schools).

Such corporate values and assumptions have an impact. They might believe in "community", for example, but what do they mean by that? How would that differ from the perspectives of tangata whenua, of not-for-profit groups, of flaxroots New Zealand communities?

Because of its size and budget, Mission Australia has the capacity to do some things well - especially in a numbers-driven approach to contract delivery. But it is also widely said that they end up competing with smaller agencies and "gobble up" the available contract monies. Groups advocating for marginalised people in particular are starved of funds.

Mission Australia's former CEO Patrick McClure headed John Howard's review of social services, with increasing numbers forced on to work-for-the-dole programmes. They proudly own schemes that many see as immoral and repressive. They display no ethical doubts about tightly controlling beneficiaries' lives, and seem distant from the marginalised and their advocates.

In the 1990s the National Government tried to implement the repressive "Wisconsin Works" model from the US. This week's benefit announcements echo an aspect of this model. It is not surprising that this facet of Mission Australia's money-making may have been of interest.

So, what can be inferred about National's social policy plans? Key is looking at large contracting arrangements as in Australia. And National's consultee, Mission Australia, reveals the use of large corporates to control social service contracts, with smaller groups effectively starved of funds.

Key may also be looking at contracting as the centralised model of relations between Government and the sector, with relationships with tangata whenua, communities in need, and the not-for-profit sector, being less important. And sidelining the advocacy work of groups working closely with the disadvantaged, with possibly the look of a church-based social service shielding it from criticism.

It is enough to raise concerns, when National announces its social service policy.

In New Zealand the tangata whenua community voluntary sector is uniquely placed to be close to our communities, to hear their issues, to advocate for them - and be accountable to them first.

New Zealand gains hugely from this voluntary sector. National may not want to clash with the community voluntary sector as it did after the 1996 election.

But it could be dividing social service organisations - seeing who will fit in with its super-contractor model, and who won't.

This move will effectively privatise chunks of the sector. Private public partnerships tend to socialise losses and privatise profits - including social service PPPs.

Where does privatising leave small Maori and community groups serving their communities? The smooth corporate style, centralised contracting, is not the way groups best support communities' hopes.

* Tim Howard is a Whangarei-based community development worker, with Northland Urban Rural Mission.

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