banner image
Press Release

Budget 2012: More focus on social enterprise to deliver better outcomes

02 May 2012 6 min read

In the 2011 Budget, the New Zealand Government directed more than 31% of total expenditure, $22 billion, to social welfare. This was one of the most significant items of expenditure, alongside health and education. Two of the main components of social welfare expenditure were $8.8 billion to superannuitants and just under $5 billion in benefits.   

Several welfare reforms have recently been put forward by the government. But questions need to be asked about what else collective leadership – not just the government but the private sector, communities, social service providers, management, business and, of course, you and I – can do to produce better social outcomes for New Zealand. 

To answer this question, one only needs to look to social enterprises – organisations that operate or trade to achieve social objectives, such as addressing social problems, improving communities and people’s life chances or the environment. 

There are a number of very good examples of social enterprises that are achieving results in their respective arenas such as Tipu Ora Charitable Trust in Rotorua, Dilworth School in Auckland, various church based social service providers, the New Zealand Housing Foundation and TradeAid. Some of these combine the social enterprise model with the traditional charity funding model. There are many other programmes that are currently funded directly by government that could be restructured as social enterprises with community support.

These organisations are delivering and producing excellent outcomes for their communities and therefore over the longer term will reduce the burden placed on prison, policing, hospitals and welfare expenditure.  These social enterprises actually help improve New Zealand’s productivity by fostering healthy family environments, improving the lives of those struggling and generally creating a better society. 

These same social enterprises say that there is much more that they could be doing if the appropriate structural, operating and funding models were implemented to support their growth.

This is where the collective leadership should take a strategic view and focus on developing what we call private public community partnerships (PPCP). The appropriate structural reforms should be implemented to support the  growth of PPCP and support a burgeoning social enterprise economy. This effectively matches private sector capital, public sector social services contracts, community based facilities and social programmes in partnership with efficiencies built into a PPCP operative model with standards. The  community aspect is critical when it comes to accountability and overall responsibility, as strong community relationships are required for programme success. 

The recession has encouraged governments to look at alternative models for social policy delivery, while communities and individuals have moved to create their own opportunities. In New Zealand the social enterprise model has been discussed widely during the past few years but it is regarded as  under-developed. Now is the right time for this to be placed high on the agenda. 

Sure, the Government has a big job on  their hands trying to balance the books. But let’s get serious about putting in place meaningful initiatives to tackle the real problems that our society is dealing with. The benefits and outcomes produced by PPCP will play a significant role in producing a better quality New  Zealand because rather than absorbing costs for social dis-function, the families and communities receiving the benefits of PPCP will be positive contributors to the growth of the country. 

This vision of a brighter future can be a reality if we support social innovation. This will lead to better results for the country and bring us to surplus quicker. We do not need to recreate the wheel, but simply create an environment to enable existing proven programmes and providers to expand their reach to communities that need the support.

Further enquiries, please contact:

Jason Rogers
National Director, Markets and Government Advisory team member
T +64 (0)9 308 2727
M +64 (0)21 438 617
E Jason.rogers@nz.gt.com

Copy text of article