Govt to Review Human Services in Response to Competition Inquiry

The Federal Government, in response to the Harper Competition Policy Review, will commission a Productivity Commission inquiry into human services to look at reforms around the principles of choice, competition and contestability, including the effect on the Not for Profit sector.

A Treasury response statement said the Government had discussed with the states and territories its interest in identifying and facilitating innovative ways to deliver human services and promote economic growth.

“This will build on reforms already happening across the different sectors in human services, including the National Disability Insurance Scheme, the Vocational Education and Training system, jobactive (Commonwealth Employment Service) and proposed reforms to aged care announced in the 2015?16 Budget. These examples are models of consumer choice which can lead to better outcomes for individuals and the community,” the response said.

“The review is an important step in laying the groundwork for future reforms and innovation in service delivery in this dynamic and diverse sector, building on lessons learnt from initiatives such as the National Disability Insurance Scheme and reform of the Vocational Education and Training system.”

However, the Government’s response to the Harper Review has drawn a mixed response from the Not for Profit sector.

UnitingCare Australia said increased choice and control for individuals across a range of human services would lead to improved outcomes for people.

“We have seen this happen in the mental health field in the last 15 years. We would support Professor Harper's view that there are limits to competition in the delivery of human services. The entire focus of social services is to address disadvantage and in this regard we must remember the specific needs of the vulnerable Australians we serve,” National Director of UnitingCare Australia, Lin Hatfield Dodds, said.

“Choice for people accessing human services is a positive game-changer. Success requires recognition of different capability and capacity to exercise choice. In social services, government must ensure that service infrastructure underpins choice. Choice must build on existing settings to be successful.

“The Government has responded positively to placing the consumer at the centre of human service delivery and for this we congratulate them. Understanding that services must respond to consumer choice and need is critical to the delivery of high quality and appropriate services.”

However, the CEO of Community Council for Australia, David Crosbie, said the one thing Australia’s charity sector did not need was increased competition based on price.

“Forcing competition based on price does not produce better community services, and treating community service provision like a simple procurement process is a sure fire way to achieve less productivity and less quality services,” Crosbie said.

Crosbie said if governments were serious about productivity in the charities sector, the policies that needed to be adopted were well documented and widely acknowledged.   

“It is now almost six years since the Productivity Commission made substantive recommendations to improve the productivity of the sector, but most of the recommendations have been ignored by governments,” he said.

The Government commissioned Professor Ian Harper to undertake an independent “root and branch” review of competition policy, which was said to be the first comprehensive review of Australia’s competition framework in more than 20 years.

The Competition Policy Review’s Final Report made 56 recommendations for reforms across three key themes: competition policy, laws and institutions.

Welfare peak body, the Australian Council of Social Service (ACOSS), said when the report was released that competition policy didn’t exist in isolation but needed to suit the social, economic and environmental environments to which it applies.

“We welcome the Report’s recognition of the importance of collaboration in human services for the community and its focus on consumer choice. However, we are concerned about the recommendation of deepening and extending competition policy in human services as a ‘priority reform’,” ACOSS CEO, Cassandra Goldie, said.

“To date, the community sector’s experiences of privatisation in health, childcare and employment services point to price inflation, higher costs to Government, less collaboration and questionable outcomes for the community.

"The lessons from a lot of the best outcomes in communities is that you can’t always scale approaches nationally. Communities identify and meet their own needs in various ways and funding options, including from governments, need to reflect this.”

The Shadow Minister for Human Services, Senator Doug Cameron, said the Government must rule out gutting human services in the competition shake-up.

“Human Services Minister Stuart Robert must rule out cuts to frontline services and privatization of key functions of the Department of Human Services (DHS),” Senator Cameron said.

Senator Cameron said a Productivity Commission inquiry into human services in order to “incorporate principles of choice, competition and contestability” into the sector must not translate into deep cuts, privatisation, and offshoring functions of DHS.