Designing Social Service Markets: Risk, Regulation and Rent-Seeking

Description

Governments of both right and left have been introducing market logics and instruments into Australian social services in recent decades. Their stated goals include reducing costs, increasing service diversity and, in some sectors, empowering consumers. This collection presents a set of original case studies of marketisation in social services as diverse as family day care, refugee settlement, employment services in remote communities, disability support, residential aged care, housing and retirement incomes. Contributors examine how governments have designed these markets, how they work, and their outcomes, with a focus on how risks and benefits are distributed between governments, providers and service users. Their analyses show that inefficiency, low‑quality services and inequitable access are typical problems. Avoiding simplistic explanations that attribute these problems to either a few ‘bad apple’ service providers or an amorphous neoliberalism that is the sum of all negative developments in recent years, the collection demonstrates the diversity of market models and examines how specific market designs make social service provision susceptible to particular problems. The evidence presented in this collection suggests that Australian governments’ market-making policies have produced fragile and fragmented service systems, in which the risks of rent-seeking, resource leakage and regulatory capture are high. Yet the design of social service markets and their implementation are largely under political control. Consequently, if governments choose to work with market instruments, they need to do so differently, working with principles and practices that drive up both quality and equality. Abbreviations List of figures Figure 1.1 Timeline of key milestones in the marketisation of family day care (FDC) Figure 1.2 Number of family day care services, 1994–2018 Figure 1.3 Composition of newly approved family day care services Figure 1.4 Proportion of ECEC services with an overall rating of at least meeting the NQS, by provider type, Q2 2018 Figure 1.5 Overall quality rating, family day care, by provider type, 2018 Figure 1.6 Proportion of family day care providers that met each quality area Figure 2.1 Timeline of policy development in refugee settlement services since the 1970s Figure 2.2 Timeline of major policy developments in immigration detention and asylum-seekers since 1992 Figure 3.1 Timeline of key milestones in Indigenous employment policy Figure 4.1 The superannuation market: A timeline of key developments Figure 4.2a Consolidation of industry, retail and public sector super funds, 1996–2018 Figure 4.2b The collapse of the corporate not-for-profit super sector, 1996–2018 Figure 4.3 Total assets held by super fund type, 1996–2018 Figure 4.4 Private pension funds’ real investment returns in 2008 Figure 5.1 Timeline of NDIS policy developments Figure 6.1 Ownership of nursing home beds and ratio of beds per 1,000 population aged 65 years and over, Australia, 1972–84 Figure 6.2 Ownership of residential aged care places, and places per 1,000 population aged 70 years and over, Australia, 1997–2020 Figure 6.3 Timeline of decisive reforms for for-profit growth and marketisation of RAC Figure 7.1 From ‘golden era’ to ‘residualisation’: Timeline of public housing policies, 1940s to 1990s Figure 7.2 From ‘public’ to ‘social’ housing: A timeline of neoliberalisation of public housing policies in Australia, 1980s onwards Figure 8.1 The continuum of direct expenditures and tax expenditures Figure 8.2 Childcare subsidies: A timeline of recent policy instruments Figure 10.1 Opening markets into Australian social services: A timeline of key policies List of tables Table 1.1 Proportion of for-profit, government and non-profit ECEC services, 2018 (per cent) Table 1.2 Proportion of family day care services with unmet quality areas, by provider type, 2018 (per cent) Table 7.1 Major renewal projects in New South Wales Table 10.1 The growth of for-profit social service provision, 1994–2020 Table 10.2 Overview of contracts between federal agencies and the big four, published 2010–20 Acknowledgements Contributors Foreword Introduction: Designing markets in the Australian social service system 1. Quality and marketised care: The case of family day care 2. The development and significance of marketisation in refugee settlement services 3. Out of sight, out of mind? Markets and employment services in remote Indigenous communities 4. A super market? Marketisation, financialisation and private superannuation 5. Marketisation in disability services: A history of the NDIS 6. Making a profitable social service market: The evolution of the private nursing home sector 7. The marketisation of social housing in New South Wales 8. Designing public subsidies for private markets: Rent‑seeking, inequality and childcare policy 9. Public providers: Making human service markets work 10. Conclusion: The present and future of social service marketisation