This document discusses policy directions for the third sector in Australia and lessons that can be learned from experiences in the UK. It summarizes the goals of the "Big Society" policy in the UK, which aimed to reduce government and increase citizen involvement, and efforts to implement similar policies in Australia. It also outlines cuts to public services, job losses, and impacts on the third sector in both countries. These include increased financial pressures, bidding difficulties against large corporations, and risks of service quality declines or failures. The document advocates recognizing the different strengths that the public, private and third sectors each offer to better determine which types of organizations are best suited to different services.

1. Policy Context for the
Third Sector: Future
Directions
Christopher Stone
July2013

2. CPD – Public Sector
Research Program
7 October 2013 2Centre for Policy Development
http://cpd.org.au

3. What is Big Society?
• Manifesto of UK PM David
Cameron, based on ideas of think
tank director Phillip Blond
• More with less?
7 October 2013 Centre for Policy Development 3

4. Big Society in Australia?
‚securing our future depends more
on strong citizens than on big
government‛
‚you can’t have stronger communities
without a stronger economy to
sustain them and you can’t have a
stronger economy without7 October 2013 Centre for Policy Development 4
‚community
controlled
public schools
and public
hospitals‛

5. Transferable lessons?
• There are difference between
Australia and the UK:
–Federal system
–% government spending
–Government debt
7 October 2013 Centre for Policy Development 5

6. Comparison: Outsourcing
employment services
Australia
• Full introduction
1998
• Systemic
problems:
– Outcome measure
focus
– Tight margins
– Perverse outcomes
– Fraudulent
reporting
– Failing the
UK
• Full introduction
2011
• Systemic
problems:
– Outcome measure
focus
– Tight margins
– Perverse outcomes
– Fraudulent
reporting
– Failing the
7 October 2013 Centre for Policy Development 6

7. An update: The Work
Programme
• 7/10 charities may have to pull out
• Almost half said contracts "at risk
of failure"
• Almost half dipped into their
financial reserves
(NCVO ‘The Work Programme:
Perceptions and experiences of the
voluntary sector’)
7 October 2013 Centre for Policy Development 7

8. Public sector cuts in the UK
Public sector
spending
Welfare
Legal aid
Communities
department
New public
housing
Higher
education
Local
government
Police
Average
£81 billion
£7 billion
£350 million
66%
60%
40%
27%
20%
19%
10-20%
240,000 (2011)
7 October 2013 Centre for Policy Development 8

9. Public Service job cuts in
Australia
Fede
ra
l
NSW
Qld
SA
Vic
Tas
4,200
15,000
14,000
5,100
4,200
2,000
7 October 2013 Centre for Policy Development 9

10. An update: UK public
services cuts 2010-12
Social housing
development
Religious and
community services
Community
development
Central and other
health services
Family and children
social services
-52.1%
-35.1%
-25.8%
-25.6%
-14.7%
7 October 2013 Centre for Policy Development 10

11. An update: Qld public
services cuts
• Housing, social welfare and other
community services
• Dept of Communities, Child Safety and
Disability Services
• Child safety and social inclusion
services
• Alcohol reform programs
• Financial crisis emergency relief
• Community Development Program
• Neighbourhood Centre, Youth at Risk7 October 2013 Centre for Policy Development 11

12. The future? Community
sector impacts
In the UK:
• £5 billion funding cut to sector
(2012-2014)
• 2,000 charities affected by £110
million cut in 2011
• Community sector employment fell
by 70,000 (9%)
• Impacts on NFP working conditions
• Silencing or diminishing of NFP’s7 October 2013 Centre for Policy Development 12

13. An update: UK community
sector impacts
Recent survey of charities involved in
commissioning
• Bidding process unfair to charities
• Over 90% faced more risk under
new commissioning process
• Only 41% had good relationship with
corporate lead provider
–(80% when the lead provider was
a charity)
7 October 2013 Centre for Policy Development 13

14. The future? Corporate
scandals
• Southern Cross aged care: £600
million profit before collapsed
leaving 30,000 people at risk
• A4e: fraud inquiry, targets not met,
chair paid £8 million
• G4S: promised 12,000 Olympic
security guards, provided 7,000,
army called in
7 October 2013 Centre for Policy Development 14

15. An update: More scandals
• Serco:
–Pathology: significant drop in
quality
–False performance data on after-
hours GPs (252 times)
–Bins uncollected for weeks
• G4S:
–Failures on re-housing of refugees
–And increased racism and7 October 2013 Centre for Policy Development 15

16. The future? Local service
cuts
Local libraries in UK:
• Over 100 closed
• 600 (20%) under threat of closure
or transfer to community
• Legal challenge over ability of
untrained volunteers to run
• Cuts to hours, services and staff in
remaining7 October 2013 Centre for Policy Development 16

17. Neat, plausible, and wrong
• Alternatives to Big Society? Or
salvageable elements?
• Getting beyond rules of thumb
7 October 2013 Centre for Policy Development 17

18. The need for sector
diversity
• Have different strengths
• Do different jobs
• Provide different broader
advantages
7 October 2013 Centre for Policy Development 18

19. Different strengths
• Productivity Commission ‘Public and
Private Hospitals’
7 October 2013 Centre for Policy Development 19

20. Different jobs
• Christopher Stone, ‘Valuing skills:
Why Vocational Training Matters’
7 October 2013 Centre for Policy Development 20
TAFE dominated
industry training
% market
share
Mining 97.8
Information Media and
Telecommunications
94.3
Electricity, Gas, Water and
Waste Services
83.0
Construction 78.1
Private college
dominated training
% market
share
Wholesale Trade 77.0
Retail Trade 74.4

21. Different broader
advantages
• Example: Tim
Roxburgh, ‘Public
works need public
sector skills: The lost
lessons of the BER
program’
• Example: ABC Childcare
receivership
7 October 2013 Centre for Policy Development 21

22. The Question of: ‘Who does
what?’
• No one-size-fits-all solution
• Sectors have different advantages
in different circumstances
• Need to go beyond sectors
7 October 2013 Centre for Policy Development 22