Pushing jobs-focused social enterprises into the mainstream

White Box Enterprises is looking to raise the profile of Payment-by-Outcomes mechanisms for social enterprises in Australia

Advocates want to move jobs-focused social enterprises into the mainstream of employment services, with a new pilot set to fund organisations for the jobs they create. 

White Box Enterprises is delivering a pilot Payment-by-Outcomes (PBO) initiative, aimed at improving long-term employment outcomes by linking disadvantaged people with supported employment in work integrated social enterprises (WISE).

WISEs differ from regular employment providers by offering training and wrap-around services for people, including flexible work environments and career support.

Under a PBO contract, the government only pays social service providers when they meet agreed targets, such as creating a certain number of jobs over a set timeframe.

Angharad Lubbock, head of advisory services and programs at White Box Enterprises, told Pro Bono News this pilot recognised the inherent importance of funding organisations based on their ability to generate outcomes.                                    

“The proposed pilot is the first time Australia’s [WISE] sector will be funded by the Australian government for creating employment for Australia’s most overlooked and underserved jobseekers,” Lubbock said.

“What’s fundamentally clear is that the outcomes being achieved under Australia’s current employment service provision model are not achieving the sorts of outcomes which are going to address entrenched unemployment for people.

“Nor [will they] create an inclusive economy that is more responsive to the needs of people experiencing hardship and barriers to employment, such as what we have seen through the COVID pandemic.”

Lubbock noted that WISEs don’t currently receive any direct government funding for providing training and wraparound support to people, but this $3.8 million pilot will see enterprises funded for every job they create.

White Box Enterprises has worked with the sector to gauge how much it is costing organisations to support someone to make a transition to a job beyond the social enterprise.

“We’ve been trying to establish the underlying costs of providing essential training and support services to people who have experienced unemployment for long periods of time, and overcoming other complex barriers, including disability,” Lubbock said.

“And what that’s basically told us is that it costs social enterprises that are dedicated to long-term results on average an estimated $22,308 to support somebody over a period of 18 months.

“And that’s been incredibly valuable as we start to model out the financial aspects of the program. And it will be significantly important in determining how many participants can ultimately participate.”

White Box Enterprises has also developed some PBO principles in order to make outcomes-based payment approaches successful for WISEs.

Lubbock said one of these principles was that the timing and intensity of support really mattered.

“And by that we mean the experiences and data that we’ve gathered confirms that support costs for people are highest in the first 12 to 18 months due to the intensity of support required to build confidence, new skills and personal networks in this early stage,” she said.

“Following a person commencing work, their confidence gradually rebuilds, they learn new skills and create new networks and resilience, meaning the intensity of support and the associated costs reduces.

“So this will influence the pilot, because there will be an emphasis on that period of time in the person’s work experience with a WISE.”

Lubbock said another important principle was around the importance of supporting individual choice.

She said employees who choose to seek employment after they’ve worked in a social enterprise did so generally with the support of the WISE team that’s been around them.

“The costs associated with this life-changing support is currently borne by the enterprise itself or funded by annual philanthropic programs – this is not sufficient to scale the impact. Social enterprises need to be funded for that work,” she said.

Now this work has been completed, White Box is in the final stages of co-design with the Australian government.

The organisation hopes that by the end of August, it will have met with all shortlisted enterprises that have expressed interest in the pilot and can then move forward to finalise the proposal.

The pilot is anticipated to be run over three years, allowing time for employment to be created in a social enterprise and also in environments beyond.

Lubbock said the pilot aims to demonstrate that supporting people with additional needs at work can lead to significant personal improvements, which in turn leads to major social and economic benefits for governments.                                                                                              

“If we can deliver a successful pilot, we will see Australia’s jobs-focused social enterprises become part of the mainstream fabric of employment services in Australia. That’s the vision for leading this work,” she said.  

“And at a human level, we want to see the training and support people require to be successful in their job being funded adequately and consistently over time.”

You can find out more about the pilot here.