Local family violence agencies have won a one-year reprieve before the Government introduces a radical new results-based system of funding social services.

Last week's Budget has quietly extended a $2.8 million allocation for 32 local agencies to co-ordinate work to reduce family violence until June next year.

National Network of Stopping Violence Services manager Brian Gardner said the Ministry of Social Development announcement on Friday came as a surprise because he "hadn't heard boo" from anyone since the agencies raised the alarm in March that their contracts would expire next month.

He gave credit to Social Development Minister Paula Bennett.


"I think I need to give the minister half a bouquet, or two-thirds of a bouquet," he said. "She has listened to what has come out of communities saying what makes a difference."

But Ms Bennett has also indicated that funding beyond next year will be on a new basis that will pay agencies by results.

The new approach has started with contracts being tendered for helping school-leavers find work or training and helping teenage beneficiaries learn budgeting, parenting and work skills.

Assuming an average of 18 months working with each beneficiary, only a quarter of the payments to agencies working with school-leavers will be based simply on client numbers. The other three-quarters will depend on the youngsters achieving agreed milestones, such as passing each level of NCEA and staying off welfare for at least three months after they turn 18.

Mr Gardner said Ms Bennett had told all social service agencies to expect similar measures. "We welcome the challenge of the thinking," he said.

"What your milestones are is going to be really critical. In the area of violence, what you do in a [non-violence] programme is only part of the picture. It's also: has he got a job? Has he got a drug and alcohol problem? Has he gone to jail?

"So it's going to throw some challenges up for our sector about how do we work differently, how can we work closer together, can we give away patch protection?"

The new system is being introduced in tight times. Although the Government is spending more on priorities such as the new youth contracts to reduce welfare rolls in the long-term, it is phasing out more general social service funds.


The Budget confirmed that no more money has been allocated to the Community Response Fund, set up in 2009 to help agencies cope with the recession, which had $20 million last year.

Another fund for "quality services and innovation", which got $10 million in last year's Budget, has been "reprioritised" into a new "capability investment resource" with "incentives to achieve real results" and aiming to help agencies work together.

Funding for this resource will drop from $14.4 million in the coming year to $8.6 million in 2013-14 and $4.3 million a year beyond that.

Council of Christian Social Services executive officer Trevor McGlinchey said it was not clear how much these cuts would be made up with increased funding for budgeting, parenting, job training, childcare and other services aimed at getting beneficiaries into work or training. He urged the Government to work with agencies to ensure no key services fell through the cracks during the changes.

Old system
* What: Agencies paid by client numbers.
* Incentive: Compete to attract clients from any source.

New system
* What: Agencies paid on agreed milestones, eg, getting someone a job.
* Incentive: Work with everyone who can help, eg, schools, training agencies, drug/alcohol services.