A Third Way for Delivering Public Services - Green Paper

Co-operatives and mutuals have the potential to generate better social outcomes and greater value for money in delivering public services in Australia and offer a “Third way” that complements provision by Not for Profit and for-profit organisations, according to a new Green Paper.

The discussion paper, prepared by the Net Balance Research Institute for the Business Council of Co-operatives and Mutuals, explores “a third-way where co-operatives and mutuals play an expanded role in delivering public services through the expansion of existing Public Service Mutuals and the establishment of new Public Service Mutuals including spin outs from government agencies and co-operative structures that facilitate collaboration between not-for-profit organisations”.

Lead researcher Les Hems says currently government privatising and outsourcing public services has focused on an expanded role for for-profit and community service sectors, however these options have limitations and there is now increasing emphasis on public service innovation especially in relation to client directed care and the co-design of services.

He says consumer owned Public Service Mutuals have the potential to thrive in the new public service markets such as the National Disability Insurance Scheme and aged care services which are seeking to provide consumers with both choice and control.

“There are also opportunities for employee-owned Public Service Mutuals in these public service markets which are rapidly expanding and where the development of a strong and growing workforce will be essential. The biggest opportunities for employee-owned PSMs relate to the abolition and privatisation of government agencies at Federal and State levels.

“This particular strategy has been particularly successful in the United Kingdom where Public Service Mutuals are a key driver of public service reform. There are also new employee-owned Public Service Mutuals being established to provide opportunities for care workers to operate in these new and expanding public service markets," Hems said.

Gillian McFee Chair of the Public Service Mutual Task Force said “The unique ownership structure and ethos of serving members first, enables co-operatives and mutuals to deliver services around the needs of people using those services. Achieving this potential requires greater public policy attention and for the co-operative and mutual sector to come together to demonstrate how it can add more economic and social value in Australia.”

Melina Morrison, Chief Executive Officer of the Business COuncil of Co-operatives and Mutuals said that “Realising this potential in Australia will require the formulation of a strong body of evidence, a compelling business case, and sustained communications and implementation strategies. The paper sets out a series of strategies and initiatives to “scaffold” the development of Public Service Mutuals which will engage a broad set of stakeholders including existing co-operatives and mutuals, all tiers of government and Not for Profit organisations.”

Following a national roundtable on the role for co-operative and mutuals in public sector reform in November 2013, the BCCM established a national Task Force to explore the viability and roles for cooperatives and mutuals in delivering key public services. The Task Force was formed to oversee preparation of this Green Paper and, following a period of  consultation, the publication of a White Paper which will present recommendations designed to help realise the potential of public service mutuals in Australia.

The Not for Profit sector is invited to comment the Public Service Mutuals Green Paper  in an online survey to capture feedback on the key findings and consultation questions outlined in the Green Paper. The survey can be accessed here: https://www.surveymonkey.com/s/PSMsGreenPaper

The Survey will end by close of business Monday 23 June 2014.

Feedback from the consultation will be used to inform the development of recommendations to be presented in the Public Service Mutuals White Paper which will be launched in July.