If Governments Want Social Innovation, They Need to Share the Power!

This week I attended a fascinating lecture by Peter Shergold entitled “Partnerships for Social Innovation:  Can They Really Work?  Tales from Australia”.  I wanted to post my notes as his experiences are illuminating and his process  inspiring for those interested in new ways to look at government funding.

Based on his vast experience working and experimenting in Australia’s public sector, Peter Shergold believes that governments at the state and federal level can learn to work with community organizations to provide public services in socially innovative ways.  The key is to share the power. For Shergold, the starting point is to look at a cross-sectoral approach to delivering public services.

In his presentation this week at UBC, Shergold began by discussing the notion of civil society and public engagement.  He put forward that citizens’ expectations were rising faster than governments could deliver in this day and age, and outlined an approach he had consequently developed and implemented at the departmental level several years ago.

Under previous regimes, community organizations were funded directly by the government through grants for various programs, even though the grants rarely covered the full cost of delivering the programs.  Shergold’s government department, instead of providing grants, began to directly outsource the delivery of programs to these community groups as service providers.  This was anticipated to achieve three goals: community organizations would be more cost-effective in delivering programs; community organizations were perceived to be more empathetic with the plight of the people they served; and given their closeness to the service users, community groups would be able to be more socially innovative in tailoring program delivery.

As the man said, two out of three ain’t bad. While being more efficient and empathetic, the approach failed to lead to any significant innovation in program delivery.  Why?  According to Shergold, high levels of bureaucracy and bureaucratic intervention led to community organizations focusing more on compliance than performance.  They became quasi-public service agencies.  As well, community organizations were only involved in policy development at the later program delivery stage.   Ultimately, Shergold found that this new regime illustrated the difficulty with the public service in letting go of its control of program delivery as well as putting community organizations under pressure. The community organizations were losing that sense of mission that holds them together.

So Shergold began to pursue better ways to stimulate social innovation through public, community and private collaboration.  This process was based on 4 elements:

–       new ways to deliver public services

–       new ways of funding public services

–       new ways of designing public services (the benefit of engaging community organizations and users of services)

–       new ways of measuring the effectiveness and outcomes

(He noted that full social returns on investment are hard to define and find appropriate metrics for.  We certainly experience the same difficulty in Canada.)

Using this template, Shergold has recently worked with two states in Australia to implement a system whereby public services would be provided by community organizations.  His view is that government delivery of public services is effective at a higher industrial level, but at the level of service delivery it lacks the ability to be flexible.  Often, a standard approach is favored by governments as the most effective means but this is not usually in the best interests of the individual.   (ie: mental health)

The basic tenets of Shergold’s approach are:

–       decisions had to be transparent

–       there had to be a minimum of red tape

–       community organizations had to be involved in policy development

–       funding had to be sustainable

–       programs were to be designed to give greater power to the user in providing more self-directed individual choice

The whole notion was based on a sharing of power and positioning the government as a facilitator between private investment, public community organizations and the provision of public services.

To this end, the state established an over-riding advisory committee made up of 10 Deputy Directors of key government departments and 10 CEOs of non-profit community organizations, to meet quarterly to develop and implement the process, address issues and determine actions.  The most intriguing part of this set-up is that there are no proxies.  A Deputy Director or CEO could not delegate attendance and involvement to an underling.  This was a true sharing of power and decision-making at the senior executive level.  Decisions were made, red tape was reduced, and long term funding was established at viable levels.

The process has only been underway for the past 18 months but Shergold has hopes it will achieve what previous measures did not – social innovation in the delivery of public services.  It is a bold step forward.

Shergold’s talk was part of the Salon Series being presented by the ISIS Institute, Sauder School of Business at UBC.  Peter Shergold is currently Foundation Professor at the Centre for Social Impact (CSI), a cross-university collaboration between business schools at 4 major Australian universities.  He has a long history of high-level public service at the state and federal levels in Australia and remains actively involved in the private, public and “third” sectors.

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