NFP’s Hit Out at Funding Process During Senate Inquiry

Not for Profit peak bodies and leading welfare organisations fronted a Senate Inquiry in Canberra today venting their anger and frustration over the Department of Social Services’ so called “open tender” process in which just 15 per cent of applications for funding were successful.

Peak bodies told a Senate Community Affairs Reference Committee inquiry that the tender process by the Department of Social Services had been deliberately divisive and had “pulled the rug out from underneath” the sector.  

Australia’s housing and homelessness peaks also called on the Senate Committee to urgently restore funding to the peak bodies who provide a voice for vulnerable Australians.

Other welfare peaks called on the Federal Government to restore funding stability to the whole sector for the continued delivery of community services as well as ongoing employment.

The Senate Committee, chaired by WA Greens Senator Rachel Siewert, is inquiring into the impact of the Commonwealth Government's $1 billion cuts to community services.

Earlier this year a Senate Estimates Committee hearing in Canberra was told that the Social Services Department received 5,572 applications from welfare groups seeking $3.9 billion over four years when there was just $800 million available.

As a results a number of peak bodies and advocacy groups learned that they have been defunded as part of the $240 million budget cuts to social services – two days before Christmas.

The latest Senate inquiry is looking at the impact of service quality, efficiency and sustainability of the tendering processes by the Department of Social services.

ACOSS CEO Dr Cassandra Goldie told the Senate Standing Committees on Community Services the impact of the funding cuts was already being felt by the sector and the people on the lowest incomes across the country.

She said the budget cuts to the welfare system were massive and savage and they had no idea where the Government intended to land those cuts.

“So the tender process was not an innovative exercise….the timing was untenable…It was the worst experience and deeply shocking for the sector,” Goldie said.

The housing and homelessness peaks Community Housing Federation of Australia (CHFA),

Homelessness Australia and National Shelter told the inquiry that they were told just before Christmas that they would not be funded past 30 June 2015.

They said the defunding was the result of the Government stripping away $21 million in housing and homelessness funding, which was having a detrimental impact on research, innovation and effectiveness and efficiency of long term service provision in the housing field.

“The funding decision has pulled the rug out from underneath us,” CHFA CEO Carol Croce said.

“It never struck us that the funding would not last until 2016. We are now seeking seed funding from housing providers to help continue to do our policy work.”

Policy advisor with Homeless Australia, Will Mudford, told the inquiry that while the organisation had reserve funding for another 12 months it would cost another $80,000 to wind down the organisation if funding is not restored.

“(Under the DSS tender model) all our risk was in one funding round and then that was removed,” Mudford said.

“Given our strong relationship with the Department and our good work outcomes we had a reasonable expectation that our core funding would be restored.”

Government representative on the Inquiry, Senator Arthur Sinodinos, asked why the peak bodies had not considered merging and as advocacy organisations how they measured their outcomes.

The peak bodies emphasised that they worked together to connect services but worked in different areas of the housing and homeless sectors.

“Organisations like CHFA, Homelessness Australia and National Shelter provide the Government with considered, evidence-based advice on policy which reflects a range of perspectives, including that of low income and other vulnerable people.

Disability organisations said the tender process was destined to cause deep division within the disability sector.

“Instead of seeking to build capacity within the sector, DSS ran a “winner takes all process,” Matt Wright, CEO of Australian Federation of Disability Organisations said.

“The outcome was predetermined from the start by DSS,” Wright said.

Volunteering Victoria told the Inquiry today that the Federal funding process was “shambolic, disrespectful and unfair”.

The Volunteer sector in submissions to the Inquiry said it had submitted 715 applications to the Department (for $120.7 million) with just 56 organisations approved (for $6.36 million), leaving gaping holes in already limited funding of services that rely on the good management of volunteers to support communities, and particularly disadvantaged communities.

Volunteering Victoria CEO Sue Noble told the Inquiry that now the full impact is becoming clear, it was time for the Government to fix it.

“There was a lack of consultation or collaboration from the beginning – with our sector and others.” Noble said.

“We believe some of the funding decisions must be urgently reviewed, and that consultation about the next funding round must begin with the sector immediately given that this funding round to the sector expires in June 2016,” Noble said.

The DSS submission to the Inquiry, including a breakdown of the funding allocation (Appendix J), can be found HERE.