19 May 2015

Changes to funding for support providers

5:29 pm on 19 May 2015

The Government is intending to revamp the way it funds community organisations working with vulnerable, at risk and poor young people.

It says some providers might have to lay off staff or cease operations altogether as a result of the changes that will be made.

A Cabinet paper from the Social Development Minister, Anne Tolley, obtained by Radio New Zealand, showed the new approach would focus much more clearly on achieving results which were priorities for the Government.

Under the changes the Ministry of Social Development would change the way it funded those types of organisations.

The document said there needed to be comprehensive review over the next two years of the services the minister pays for, and that there were opportunities to improve the effectiveness of those services by collecting better information and analysing it.

The paper also said that once the changes were made it would simplify the procedures community groups had to follow to ensure they were meeting their contracts.

And it stated the priority areas were children at risk and those facing hardship, young offenders, and adult victims and perpetrators of family and sexual violence.

The changes did not appear to have implications for Thursday's Budget, with no suggestion of any change in the overall funding of those groups, which was currently about $600 million a year, although only about $328 million is aimed directly at children and young people.

However the paper did say depending on the outcome of the review, there may be implications in the next year or two.

Therefore, while there might be some mention of a new approach in the Budget, it was likely there will be no announcements in terms of changes to the amount of money available.

The implication was that money would be switched from providers that were seen as not being as effective as others, with the services targeted for reprioritisation were in prevention and early intervention.

It acknowledged that re-allocating money carried some risk and that some providers may need to lay off staff or become financially unviable with an impact on other services they deliver.

It also warned that some organisations were likely to protest against the loss of money and services.

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