Productivity – not the most important ingredient in human services

The Productivity Commission’s 2018 report on the community sector reported that productivity failings within the sector were failing people experiencing hardship. In today’s post, David Tennant of Family Care suggests that this conclusion should be revisited in light of the policy changes instituted in response to COVID-19.

The conclusions drawn by the Productivity Commission about how the community sector addresses hardship may not have taken a wide enough view of the primary factors. Photo by Jordan Whitfield on Unsplash

Not enough ‘productivity’ in the community services sector

In March 2018, the Commonwealth Government released a report from the Productivity Commission about introducing competition and informed user choice into human services. The report covered a variety of issues including end-of-life care, social housing, remote Indigenous communities, patient choice and public dental services. It also contained some significant implications for the design and delivery of family and community services, concluding:

Family and Community services are not effective at meeting the needs of people experiencing hardship.[1]

The Commission’s recipe for improving family and community services included better use of data, a different approach to contracting services, agreement on and monitoring of outcome measures, and improved evaluation processes. In a sector still dominated by not-for-profits, the Commission urged that the Australian, State and Territory Governments should

… Not discriminate on the basis of organisational type (for-profit, not-for-profit and mutual for example).[2]

The Commonwealth Government has not yet replied to the human services inquiry report, but that doesn’t mean the ideas contained within it have been set aside.   Take, for example, the Queensland Productivity Commission’s 2019 Productivity Lecture, delivered by Dr Stephen King, who led the human services inquiry. Dr King likened the human services sector’s evolutionary position to that of government-owned monopolies like telecommunications, transportation and energy, prior to competition reform - not an overly positive assessment given Dr King’s view that ‘these sclerotic government monopolies had high cost, low innovation and were a drag on Australia’s productivity.’[3]

Consistent with the inquiry report, Dr King identified four sets of failures in human services:

…. Failure to define what the service is meant to achieve; failure of service design to achieve the desired objectives; failure to implement the designed service effectively in the real world; and a failure to measure the service outcomes.[4]

Solutions offered in the Productivity Lecture are also unsurprisingly similar to the human services inquiry report.

Rethinking productivity and causal chains

With the intervention of the COVID19 pandemic, how much of the Productivity Commission’s pronouncements remain relevant?

The more compact format of the Lecture draws attention to what is missing in the analysis. Understanding what is not considered in a productivity-focused critique is all the more important in the wake of the social and economic upheaval caused by COVID19.

The most important gap is an appreciation of the links between policy settings and the hardship experienced by many human service users. One need look no further than key Government responses to the pandemic to find those links. Doubling the rate of unemployment benefits, the first genuine increase in over 25 years, meant that very low income people could afford essentials. Similarly, choosing to find accommodation options for a large number of homeless people reduced the potential for infection amongst a highly vulnerable group, by responding to their most basic of needs.

The COVID19 support package makes good sense both economically and to address a public health emergency – but elements of that package, at least temporarily, also reduced hardship. They were decisions that could have been made without the prompting of a pandemic. Government chose not to make them, despite a long and sustained campaign to do so, and support from such places as the Reserve Bank governor.

The relevance of this observation to an assessment of human service effectiveness is simple: Delivering services to people who have insufficient income to live a dignified existence, or do not have a roof over their heads, will always have limitations. If you address those needs directly, the potential for sustained improvement through the delivery of other services will be enhanced.

Increasing the unemployment benefit rate and providing temporary housing for the homeless will not deliver complete solutions in all situations, particularly where there are long-lived and complex problems. They are however, a great start – and there are indications it’s making a difference for many households. Many not-for-profits delivering human services have been advocating these actions for decades. COVID-19 got the job done in a few weeks.

Productivity may not be the most important factor

As we plan our way out of COVID19, we will all have to work smarter and harder. Certainly human service providers should be challenged to be clearer on their objectives, connect better with service users and undertake more rigorous evaluation.

Equally important, however, government should realise that many of the vulnerabilities that required emergency pandemic investment were directly attributable to policy settings - policy settings that have been consistently challenged by not-for-profit human service providers as unduly harsh and counterproductive. Perhaps if Government had listened more and acted sooner, those providers might have been more successful at meeting the needs of people experiencing hardship, improving both productivity and wellbeing.

Posted by @SusanMaury

References

[1] Productivity Commission 2017, Introducing Competition and Informed User Choice into Human Services: Reforms to Human Services, Report No. 85, Canberra, p.2.

[2] Productivity Commission 2017 (ibid) page 46 (Recommendation 8.2)

[3] King, Stephen, Human Services: The next wave of productivity reform, Productivity Lecture, Brisbane, November 2019, p.1.

[4] King, Stephen 2019 (ibid), p.3.