Social Investment: Social Failure?

The terms ‘social’ and ‘investment’ are an unlikely combination. Proof economists have crossed the final frontier and sallied forth with their spreadsheets into social services. Social investment means, “investment to achieve better long-term results for people and helping them to become more independent. This reduces the number of New Zealanders relying on social services and the overall costs for taxpayers” (Treasury briefing paper on social investment 2016).

To be blunt, the social investment approach is too narrow and too nasty. It involves too much invasion of privacy, too much blame, too much resentment about sharing our collective wealth for our collective benefit. And it paves the way for government-funded social service delivery to be just another profit-making opportunity for overseas corporations.

Social services were initiated by early settlers to avoid replicating the Dickensian British workhouses in their adopted country. Social services were refined over the next 80 years or so to provide a decent safety net for all New Zealanders if and when they needed it.

Enter the neoliberals, who, lacking in humanity and perhaps a knowledge of the humanities, saw the provision of a safety net to be at odds with their personal need to become as rich as possible. It required them to pay taxes and for the government to spend some of the money from the tax take on people other than neoliberals themselves. Their mission became to dismantle social services – with the exception of the justice system, of course, which enables them to protect their wealth.

The direct approach of axing funding for social services proved unpopular, a marketing failure. Other, more marketable methods were needed. Hence the social investment approach. Focus on the individual and the service provider. Blame the individuals and service providers. People who are dependent on state support need to be fixed as soon as possible so they can stand on their own two feet (or wheelchair wheels, walking sticks, etc) so state support will not be needed. Service providers need to get their act together if they wish to continue to access government funding. Services must be time-limited. They must deliver the goods/fix these people in the shortest time possible and send them on their way.

The social investment approach is problematic for service users, service providers, and society. People in need of state support do not exist in a vacuum. There are many and varied social conditions that cause people to require state support; unemployment, lack of affordable housing, low wages, lack of affordable tertiary education, ongoing permanent health issues, archaic intransigent drug laws that seek to punish rather that offer treatment to those with substance abuse issues. These cannot be fixed in a single year by a single service provider.

Many service providers, in an effort to produce the results the government desires and secure ongoing funding, will only provide services for people who are ‘easy to fix’ within the target population. For example, highly skilled people with a history of minor crime, or a relatively insignificant disability or health related problem. And they will apply formulaic approaches. This is of particular concern when for-profit companies are chosen as service providers. Their need to make a profit creates additional pressure to ensure short-term results with the least input.

Unfortunately, the social service sector is an area where those most in need of assistance require a lot of input. It may take many trials to find the best approaches for a particular individual. And making lasting changes is a long-term project. It can take years, and sometimes generations, before the results become apparent. Not something that can readily be graphed or put on a spreadsheet. But very significant, nonetheless.

The social investment approach could well leave a large number of people without access to any support. Non-profits that for social reasons want to offer assistance to those in the greatest need will struggle with cuts in funding because they cannot move people through the system quickly enough.

Finally becoming more independent and thus not being a cost to the taxpayer is not the most worthwhile outcome of social assistance. Some people will always be a cost to the taxpayer in monetary terms. However, that does not preclude them making an enormous contribution to society in other ways.

Diverse and inclusive societies are more pleasant, safer, innovative and vibrant places for everyone.

Social services should be accountable, they should use government funding wisely. And they do. Social services should always strive to make a positive difference to the people they support. But the result will not always mean less state assistance. For some people, it may mean more state assistance is required for the whole of their lives. Neoliberals and economists need to find a way to cope with that. Valuing and adequately funding existing social services is a very good place to start.

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