Submission to Productivity Commission - Draft report: Introducing Competition and Informed User Choice into Human Services - The Centre for Independent Studies
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Submission to Productivity Commission – Draft report: Introducing Competition and Informed User Choice into Human Services

The Productivity Commission (PC) released a draft report proposing reforms to increased competition, contestability and informed user choice to human services.

CIS responded to the PC’s report with a submission covering two issues raised in the draft report: social housing and remote Indigenous communities.

In relation to social housing, the CIS submission argues:

  • The PC’s draft report presents strong arguments in favour of social housing tenants being charged market rents. However, this approach will either result in very large increases in out-of-pocket costs for some tenants, or very large increase in government spending.
  • Therefore, the PC should made recommendations for increased choice and competition in the sector without the full-scale adoption of market rents.
  • The model proposed by CIS is for the following:
    • The base social housing rent to remain as a fixed proportion of tenant income, with potential for reforms to this model over time.
    • New social housing tenants, and tenants who wish to move, will be offered the choice of property in the relevant region. All vacant social housing properties would be offered to all prospective tenants.
    • For these tenants involved in the choice process, social housing providers could choose to set a rent discount or supplement.
    • This will mean social housing providers will compete with each other over price, location, quality and services. Competition should drive increased quality, tenant satisfaction, tenant mobility, and sectoral efficiency.
    • Initially, existing tenants would not have a change in rent, but informed choice and differentiated rents should be rolled out to existing social housing tenants with appropriate safeguards.
    • Any government policies that treat public housing and community housing differently should be removed.
    • State governments should, over time, transfer public housing assets to the community sector to increase competition, efficiency, and the scale of the community sector.

In relation to Remote Indigenous communities, the CIS submission:

  • Agrees with the PC draft report’s two principles for service delivery in remote communities — greater community voice and place-based approaches. However, we believe the PC draft report has not clearly articulated the challenges in adopting these principles, notably that increasing community control in the design and delivery of programs does not always led to better programs. Moreover, the unique nature of place-based approaches can make it hard to compare the effectiveness of different program, as any metrics recorded may not be readily compiled, or compared with those from other programs.
  • Agrees with the PC’s draft recommendation 8.5 to: “Invest in better systems to underpin service delivery by developing objectives, conducting community assessments and establishing evaluation and feedback systems” and we believe that developing a co-accountability approach to service delivery and evaluation could help to ensure this happens.
  • Agrees with the PC draft recommendation 8.3 to: “Ensure commissioning processes have a strong focus on transferring skills and capacity to people and organisations in communities.” We support an enabling model of governance in service delivery that promotes a gradual shift in decision-making power, behaviours, responsibilities and attitudes towards one that builds Indigenous leadership.