From Not for Profit to Social Purpose in an Ageing System

As Australia’s population ages, it’s time for Not for Profit leaders to step up and help shape the social outcomes systems of the future, writes Centre for Social Impact Chief Executive Officer Dr Andrew Young.

Australia faces a massive challenge in the next three decades as our population ages. Spending on health, welfare, education and other social purposes will come under unprecedented pressure. How will the Not for Profit sector rise to the challenge?

The recent Productivity Commission report “An Ageing Australia: Preparing for the Future” and Federal Treasury Not for Profit sector consultations earlier in the year both raised the question of productivity improvement in social purpose organisations. They are right to do so.

Australia spends well in excess of $250 billion every year on social purpose across Not for Profit, government and for-profit sectors. It’s a big number – nearly a fifth of Australia’s GDP, for comparison.

In the next 30 years, in relative terms we simply will not have more money with which to address social issues.

If Australians don’t work substantially longer, and if we choose not to raise taxes very significantly, we will have to double our social outcome “productivity” to deal with the challenges we face.

In conferences and workshops around the country this year, I’ve asked leaders from Not for Profit, government and corporate sectors how well they think Australia is doing. Are we exponentially improving outcomes for every dollar we invest? Is improvement slow and steady? Or are we going backwards?

Fewer than 10 in a thousand say strong growth; the consensus is just a little above zero.

Of course, it’s a complex question to answer. We don’t have one social purpose system, we have many, and they’re fragmented and complex. We don’t have one social issue, we have hundreds, and they’re interrelated.

And when we talk about measuring outcomes we’re not comparing apples with apples; we have the whole fruit salad, and then some.

There are many examples where we are not achieving the outcomes we sought. In the past week alone we’ve seen headlines about the lack of improvement in indigenous health and the fall in education achievement compared with some international benchmarks. There are many more.

The “social purpose system” in Australia is big and expensive. And in spite of decades of continuous economic growth, we are not very good at addressing complex social issues.

If we can say one thing with confidence, it’s this: in addressing complex social issues, starting another “program” through a top-down, competitive funding process will not work. There are no silver bullets.

As a country, we are accustomed to assigning responsibility for these issues – and blame – to government. It’s time we shared that responsibility around.

Governments will rightly look more and more to other sectors to deliver social programs and improve outcomes.

The first reaction from some is to use terms like “outsourcing” and “abdication of responsibility”, but there is opportunity as well as challenge. Some organisations will flourish under models like the National Disability Insurance Scheme, as one example.

We need to make sure we are clear about our aims in reforms like the NDIS, and very smart about the implementation.

In this changing world there are five keys, led by clarity of purpose and our intended outcome. We need more effective measurement of the outcomes we are achieving, and we need funding models that are more aligned with outcomes.

We need mechanisms for scaling social innovation and embedding new approaches in mainstream practice.

We need greater investment in the capacity of social purpose organisations, managers and leaders.

Last but by no means least we need to be much more effective at cross-sector, cross-organisation collaboration and the engagement of community in addressing complex community issues.

The time is right for Not for Profit sector leaders to help shape the social outcomes systems of the future. It’s also time for a change of name. We need to be less focused on tax status, and more focused on role.

It’s time for the “Not for Profit sector” to become the “social purpose sector” and take its place in meeting Australia’s social challenges of the next thirty years.

About the Author: Dr Andrew Young has been the Chief Executive Officer of the Centre for Social Impact since early 2012 and was previously Chief Executive Officer of youth cancer charity CanTeen. He is dedicated to improving the effectiveness of social impact across the social purpose, government and corporate sectors in Australia.