December 2011
Briefing to the Incoming Minister for the Community and Voluntary Sector
CC to: Prime Minister and Ministers of Health, Social Development, Finance, Education, Justice, Revenue, Whanau Ora and Disability Issues, Housing, Internal Affairs, State Services and Corrections
The purpose of this briefing is to summarise key community and voluntary sector issues and solutions. It deals with specific issues and identifies emerging issues and policy challenges.
The briefing has been prepared by ComVoices, an independent coalition of Tangata Whenua, community and voluntary sector organisations (the Sector). We represent a group of national organisations who reflect the diversity of the Sector, and who actively promote the value, scale and scope of the Sector to the social and economic wellbeing of New Zealand.
ComVoices members have worked constructively with previous governments on a range of policy and initiatives, including the Code of Funding Practice, Giving and Generosity, tax changes for donations and the Community Response Fund.
SUMMARY OF ISSUES
ComVoices believes that successful partnerships between the Government and the Sector are built on long term, high trust and outcome driven models of consultation and engagement. A strong, vibrant and capable community sector is critical in hard times.
ComVoices members are looking for the current Government and successive governments to:
Recognise that strong non-government partners are critical to the delivery of social and community services. The best results will be achieved when we work together.Sector representatives should be engaged at both a ministerial and senior public servant level as the Government introduces reviews, policies and processes. In particular, the Sector should be consulted when changes are likely to have a significant impact such as welfare reform, funding for services, the constitutional review and emerging cross-agency approaches.
Support the Sector’s history of social innovation. TheSector is made up of experienced innovators. Government should support and make use of the sector’s innovation, experience and institutional knowledge to build on programmes such as Whānau Ora, the Community Response Model and community led regional funding initiatives. Government should involve non-government organisations in the planning and implementation of innovations. Care needs to be taken that the development of new social innovations and policies does not have the unintended consequence of undermining existing quality programmes and service providers. As new programmes are developed, early signals need to be given so the Sector can plan, adapt and respond effectively.
Support a strong funding environment for community organisations. Community organisations rely on a mix of funding. Government contracts are an essential part of service delivery. At the same time, there is growing interest in generating more, and new kinds of earned income. Changes to funding processes and contract regimes should not be made without consultation. ComVoices calls for a review of the regulatory environment to assist with social enterprise, such as increased access to capital, share infrastructure and services, and to reduce existing regulatory and policy barriers.
Address growing inequality in New Zealand. ComVoices members believe that inequality is the single biggest issue facing both the Sector and the wider community and request that the Government, in partnership with the Community Sector, identify and introduce a measurable goal for reducing inequality.
SUMMARY OF RECOMMENDATIONS
1. Recognise that strong non-government partners are critical to the delivery of social and community services
· Ongoing consultation and engagement on the development of social and community policy and implementation processes
2. Work with the sector to support social innovation and change
· Support and make use of the sector’s innovation, experience and institutional knowledge
· Take an adaptive, cross-agency approach to policy making
3. Support a strong funding environment for community organisations
· Consult with the Sector on changes to funding processes and contract regimes
· Promote and develop a regulatory environment that supports social enterprise
4. Introduce a measurable goal for reducing inequality
ComVoices members would also like to see the Government:
· Commit resources for downstream impacts to the Sector when introducing measures to reduce welfare dependency
· Support stronger communities by:
o Providing more certainty for existing funding contracts by increasing multi-year funding agreements
o Allowing a capacity and capability development component in funding contracts
o Actively promoting a culture of Giving and Generosity
· Promote funding sustainability and innovation by:
o Implementing the Code of Funding Practice
o Addressing the issue of imputation credits
· Bring forward the planned review of the Charities Commission Act 2005
· Work closely with the Sector in developing proposals for constitutional change
· Establish an updated picture of the full scale and scope of the Sector
CORE ISSUES FOR THE SECTOR
ComVoices believes that the incoming Government represents an opportunity to develop open and understanding relationships to improve the value of services delivered to communities, as the Sector shifts to address changing demands and requirements.
To assist in achieving this, ComVoices has identified six key areas of focus to be addressed:
1. A measurable goal for reducing inequality in New Zealand
2. Strengthening communities
3. Funding, sustainability and innovation
4. Review of the Charities Act 2005
5. Constitutional Review and the Treaty of Waitangi
6. Data about the value, scale and scope of the Sector.
1. A measurable goal for reducing inequality in New Zealand
1.1 ComVoices members believe that growing inequality is the single biggest issue facing both the Sector and the wider community in New Zealand.
1.2 ComVoices members ask the Government to clearly set out ambitious goals for reducing inequality in our communities. These goals should be measurable.
1.3 ComVoices welcomes the establishment of a Ministerial Working Group on Poverty as we believe that those most at risk from the effects of inequality are children, and that New Zealand’s child poverty rates are unacceptably high.
1.3.1 Ministry of Social Development figures for living standards show that before the 2009 recession, 19 per cent of children were experiencing "serious hardship" and "unacceptably severe restrictions on their living standards".
1.3.2 The terms of reference for the working group should seek specific measurements and targets to ensure a reduction in child poverty. The Sector urges the Government to develop ambitious targets in this area and for these to be integrated into all relevant work plans and projects, including the Child Action Plan.
1.3.3 The Ministerial Working Group on Poverty needs to be bi-partisan. We expect to see representation from the Child Poverty Action Group direct to the working group.
1.4 The Government’s focus should be on outcomes for lower socio-economic families, rather than treating symptoms. Any solution must be cross-sectoral and include the entire system, including the Community Sector. There is little point making changes around social development if education, health, youth training, employment and justice are not aligned with, and committed to, a common goal.
1.5 The response to the Welfare Working Group recommendations needs to ensure that initiatives assist people to overcome barriers to employment, and that vulnerable people and families receive the help they need.
1.6 Change cannot be made without significant investment. There is concern that government agencies could implement changes to welfare benefits without realistically costing the implications. Well resourced, capable providers of social services and support need to be available in every community as a prerequisite to introducing any of the types of interventions outlined in the report.
1.7 Punitive measures, without the social investment required to support families, will have a negative impact on families and communities, increasing the wealth gap further.
Recommendations:
· Set measurable goals for reducing inequality
· Develop a vision specifically for reducing child poverty
· Commit resources to downstream impacts to the Sector when introducing measures to reduce welfare dependency
Further detail/background can be found here:
• OECD’s 2009 report “Doing Better For Children”
• Left Behind: How Social and Income Inequalities Damage New Zealand Children (CPAG)
2. Strengthening communities
2.1 Community organisations are essential agencies working in communities that contribute significantly to the health of a civil society. We propose meeting regularly with senior government Ministers and public service representatives to build ongoing strategic engagement with the Government. Community organisations ensure the vulnerable and disempowered have a voice, and assist Government and policy-makers to make quality decisions around policy and funding.
2.2 ComVoices members would like the Government to follow through on its commitment to promoting a culture of Giving and Generosity, with a national campaign that recognises the value of giving time (volunteering) and money (donations, payroll giving) with a view to increasing the value of giving in Aotearoa New Zealand society.
2.3 Since payroll giving was introduced nearly $4 million has been made in donations with minimal promotional support. Awareness and payroll options for businesses are still in their infancy, while some progress has been made there is room for commitment and leadership and payroll giving needs to be more widely promoted.
2.4 Social enterprise, where businesses trade for the central purpose of achieving social or environmental goals, can help communities to be self-sufficient, grow employment opportunities and develop new skills. The Government should encourage social enterprise by developing a strategy that nurtures and supports social enterprise in New Zealand. The current regulatory environment makes it difficult to source funding in other ways without jeopardising non-profit status.
2.5 Workforce development is a major issue for the Sector. For Sector organisations contracted to the Government, ComVoices members recommend that a capacity and capability development component be added to government funding contracts. At present, this is rarely costed into contracts and therefore, it is virtually impossible to ensure that staff (paid and unpaid) have the training, professional development and support to be at their most productive and effective.
2.6 Umbrella groups and networks, at both national and local levels, provide practical collaborative activities, and are an essential conduit for reaching a diverse and broad sector.
Recommendations:
· Build ongoing strategic engagement between Government and the Sector
· Include a capacity and capability development component in funding contracts
· Develop a strategy for growing and supporting social enterprise
· Run an awareness raising campaign that highlights payroll giving and promotes a culture of Giving and Generosity
3. Funding, sustainability and innovation
3.1 Sector organisations are funded through a combination of private monies, public support and enterprise. Government contracts can be significant, but many organisations operate independently of any government funding. Other common sources of funding include grants from lotteries and philanthropic trusts, as well as fundraising, sales, fees for services, sponsorship and donations.
3.2 The issue of imputation credits needs to be addressed. Charities currently have taxation exemption status and are therefore unable to claim the imputation credit against taxable income. This means that an organisation or body which is intended to be a non-taxpayer is de facto paying tax. Therefore, in order to restore their status to being exempt the possible remedies are:
· Allow charities to claim the tax paid to Inland Revenue
· Allow charities to receive a supplementary dividend from companies from which they receive dividends.
3.3 A significant amount of funding for the Sector comes from gaming and gambling grants. These community grants need to be recognised as an alternative source of funding for the community and community-led projects, rather than another source of funding to be distributed by the Government, for government approved projects. The proportion being returned to the Sector should be far higher than the current 33 per cent.
3.4 Active promotion of the use of the voluntary Code of Funding Practice is needed to ensure it is used and understood by agencies. In particular, an organisation’s right to “act as individual or system advocates without putting their funding agreement at risk” requires further promotion within government agencies.
Recommendations:
· Implement and actively promote the Code of Funding Practice
· Address issue of imputation credits
4. Review of Charities Act 2005
4.1 In order to better support the Sector and its work, the Government should ensure the Charities Commission assists, and is accountable to, the Sector. This will ensure that the Commission works to support Sector organisations with their diverse and independent goals, rather than placing undue emphasis on trying to monitor or control them.
4.2 The sections of the Crown Entities Reform Bill, introduced in the previous session of Parliament, that relate to the Charities Commission should be put on hold until the proper review of the Charities Act 2005 has been completed. The responses we have had from Ministers in the previous government is that the Charities Act review cannot be brought forward until related legislative reviews by the Law Commission have been completed. It is therefore inconsistent to disestablish the Charities Commission and transfer its functions into the Department of Internal Affairs ahead of the review of its governing legislation. The urgency with which the Government wishes to progress structural change provides an imperative to bring forward the review of the Charities Act...
4.3 The Crown Entities Reform Bill fails to address the significant and widely-acknowledged problems that there are with the existing Charities Act. These are well documented and the Sector has provided the Government with specific proposals on how they can be addressed.
4.4 Notable among these is the need for organisations to be able to seek an independent review of Commission decisions; a means to appeal, without resorting to the High Court, where the imbalance of resources between the Commission and a community organisation makes justice and resolution of issues unattainable. This procedure has been implemented in the United Kingdom as part of Her Majesty’s Courts and Tribunals Service and is working well.
Recommendations:
· Bring forward the planned review of the Charities Act 2005 from 2015 to 2012
· Put on hold sections of the Crown Entities Reform Bill that relate to the Charities Commission until the legislative review is completed
5. The bigger picture
5.1 It is important to proceed with the review of New Zealand’s Constitutional arrangements at arm’s length from Government, but with support from the Ministry of Justice. We support the previous government’s decision that the development process not be rushed, and that there be comprehensive involvement of all New Zealanders.
5.1.2 The review must take full account of the Treaty of Waitangi and the relationships it establishes amongst all who live here, as the basis for a society that includes and protects all its citizens.
5.1.3 The New Zealand constitution must be an expression and support of the values we hold dear, while recognising our diversity as an asset that makes us stronger and more resilient.
5.1.4 New Zealand needs a constitution that balances and strengthens relationships between people, the civil society organisations they create to further their aspirations, and their elected government. There are modern constitutions that achieve this balance.
5.1.5 The constitution must reflect the ideals expressed in relevant United Nations Declarations and resolutions, including the 2010 Resolution on The Rights of Freedom of Peaceful Assembly and Association. We note this explicitly includes the right of people to form peaceful associations, formal or informal, as a means to pursue their shared aspirations.
5.1.6 We support proposals to extend the Parliamentary term from three years to four years, so as to provide greater stability to the policy frameworks within which communities work.
5.2 ComVoices members recognise and support the place of the Treaty of Waitangi and Tangata Whenua in New Zealand. ComVoices members would like to see the Government continue to recognise the important place of the Treaty. It should be at the centre of all policy development and delivery, and its impact should be effectively measured and reported on by government agencies
5.2.1 The previous administration made some very positive steps forward, notably, the implementation of Whānau Ora for the delivery of social services. It is important in the ongoing implementation of Whānau Ora there is a continuing commitment to true partnership with iwi.
5.3 Kia Tūtahi and the Code of Funding Practice are very useful initiatives to set broad agendas with community and voluntary organisations. They provide the framework for ongoing work to identify how the Government can best support the capacity and capability of organisations. It is important there is ongoing work on their implementation.
5.3.1 We commit to working with the new government and with government agencies to achieve practical outcomes from the high level principles that are expressed in Kia Tūtahi.
5.3.2 It is particularly important that the Minister for the Community and Voluntary Sector be empowered to work with other ministers whose departments are, in their relationships with community organisations, failing to live up to these principles. This is particularly important where departments are involved in negotiating contracts for services, or in providing funds to support community-initiated activities.
5.3.3 The Minister for Local Government must be enabled to work with territorial, local and regional councils to put the principles of Kia Tūtahi into practice in their relations with community organisations.
Recommendations:
· Continue to recognise the important place of the Treaty of Waitangi
· The review of New Zealand’s Constitutional arrangements must proceed at arm’s length from Government and supported by the Ministry of Justice. The development process must not be rushed, must involve comprehensive involvement of all New Zealanders and must take full account of the Treaty of Waitangi.
· The Minister for the Community and Voluntary Sector be empowered to work with other ministers whose departments are, in their relationships with community organisations, failing to live up to the principles of Kia Tūtahi.
6. Data about the Scale and Scope of the Sector
6.1 Having a clear and accurate picture of the scale and scope of the community sector is essential for an understanding of the social policy environment.
6.2 Data demonstrating the value and scope of the sector is several years old, and needs to be updated.
6.3 The data previously available has been important in developing policy and engagement across the diversity of the Sector, and with Government. We encourage the Government to continue its commitment to developing the Satellite Accounts for the non-profit sector (see Appendix 2, point 5). This would ensure that comparisons can be made over time, and that trends can be identified. It will assist a range of policy applications, including DHBs and central and local government policy.
6.4 The current social policy environment relies heavily on population data and understanding of demographics for establishing priorities. The majority of social services are delivered by organisations in the community sector. Further data about the sector is an important aspect of policy development.
6.5 ComVoices recommends the Government commit to establishing an up-to-date picture of the full scale and scope of both the economic and social impact of the community Sector. In particular, ComVoices calls for this to be repeated so that valuable, current information about the Sector is available.
Recommendations:
· Ensure Statistics New Zealand commits further resources to a repeat of its 2008 study of the non-profit sector in New Zealand.
APPENDIX 1 – ORGANISATIONS INVOLVED WITH COMVOICES:
ACE Aotearoa
ANGOA
Ara Taiohi
Birthright New Zealand
Cancer Society
CCS Disability Action
Community Housing Aotearoa
Disabled Persons Association
English Language Partners
Funding Information Service
Health Care Aotearoa
IHC
NZ Council of Christian Social Services
New Zealand Council of Social Services
New Zealand Federation of Family Budgeting Services
New Zealand Federation of Vocational Support Services
Philanthropy New Zealand
Presbyterian Support New Zealand
Prison Fellowship New Zealand
Social Development Partners
YMCA New Zealand
Volunteering NZ
To contact ComVoices please phone the current ComVoices Chair, Katherine Noble, on katherine@ps.org.nz, 04 473 5025, or our incoming Chair for 2012, Ric Odom, on ric.odom@ymca.org.nz, 027 481 1300, or 04 568 9622.
APPENDIX 2 – COMMUNITY SECTOR – VALUE, SCALE AND SCOPE
1. Community sector organisations contribute to all sections of New Zealand society, including support for and services to: the arts, culture and heritage; sport and recreation; environment and conservation; education and employment; faith communities; social services and housing; law, advocacy and human rights; philanthropy; international development; health; disability; professional associations; Māori; Pacific and other ethnic communities.
2. The community sector is distinct and different from other sectors, particularly the Government, in terms of:
· Structures
· Accountabilities
· Decision-making processes
3. The Sector values its independence. The majority of the work carried out by the Sector falls outside the processes and structures controlled and funded by government.
4. The Sector has significant economic value. It represents an enormous industry in New Zealand, creating innovative and independent economic activity that includes services on behalf of the Government, and providing an important contribution to the New Zealand economy.
5. Several studies undertaken between 2004 and 2008 provided a valuable picture of the role and scale of the sector:
· Estimated 97,000 organisations
· The sector contributes 2.6 per cent to GDP ($3.6 billion)
· And when volunteer labour is included 4.9 per cent GDP ($7 billion)
· Return on investment was estimated at between $14 and $39 over 15 years for every dollar invested in our sector
· From a direct government investment of less than $50 million into two agencies, the net economic benefit was estimated at more than $750 million
6. This information has been extended since the formation of the Charities Commission, with detail about the composition and financial position of over 25,500 registered charities.
7. The Sector represents significant value for money. A comprehensive assessment of 10 voluntary groups in New Zealand, named Counting for Something - Value Added by Voluntary Agencies (VAVA) Project, was undertaken by the New Zealand Federation of Voluntary Welfare Organisations and PricewaterhouseCoopers in 2004.
8. The VAVA report, found that voluntary groups return between $3 and $5 worth of services for every $1 they receive in funding. So, in 2002, the 10 groups returned services worth approximately $177 million for the $42 million in funding they received (from all sources). If the 10 groups studied in the VAVA report were corporate entities, they would operate within the top five per cent of New Zealand enterprises.
9. A further study in 2007, named Counting for More, identified and measured the value of outputs and outcomes in case studies of two national social service agencies. This identified returns on investment for time periods of 15 to 30 years (for different services) of between $14.30 and $39 annually for every $1 they receive in funding.
10. More than 1.2 million people volunteered time in 2008, according to research released by Nielsen Research: ‘How do New Zealanders give? Towards an understanding of generosity in New Zealand’.
11. There are about 105,000 paid staff employed in the not for profit sector. In addition, volunteer labour in 2010 was estimated to be 270 million hours, which translates into an estimate of $3.5 billion.
12. Volunteering is not restricted to the Community Sector. A lot of core central and local government work is also actively supported by volunteers, for example: the Police, Prisons, Civil Defence, Conservation and Fire Services.
