Community sector forced to carry the costs of the crisis

ACOSS is calling on the next government to address the “chronic underfunding” of the community sector. 

The community sector is underfunded, overworked and underpaid – that is the conclusion of a new report released on Tuesday that shows how the pandemic has compounded the strain on the services sector.

Carrying the Costs of the Crisis – undertaken by the Social Policy Research Centre at UNSW Sydney for ACOSS and the State and Territory Councils of Social Service – explores the experiences of 1,828 community sector workers in 2021.

The results show that while the community sector responded to the prolonged crisis with “determination, resilience, innovation, and extraordinary industriousness”, it also faced significant challenges.

In particular the report highlighted acute funding shortages; increased difficulties in securing funding; a reliance on short-term contracts; opaque and problematic contract renewal processes; contracting arrangements constraining or influencing advocacy; high amounts of unpaid work; concerns about job security; and recruitment and retention challenges.

The report concluded that community sector workers are “carrying the costs of the crisis”; with services and workers being pushed to their limits.

Of particular concern, the majority of organisations reported that the funding they received fell far short of what was required:

• Only 20 per cent said it covered the full cost of service delivery.
• Only 17 per cent said it recognised increasing wage costs.
• Only 14 per cent said it properly recognised their overheads.
• Only 14 per cent reported indexation arrangements for their main funding source were adequate.

In addition to the acute under-investment, a third of service leaders expect their finances to worsen in 2022, with many sector leaders and workers offsetting funding shortfalls by performing large amounts of unpaid work. 

ACOSS CEO Dr Cassandra Goldie said there was a reasonable fear among sector leaders that the situation will only get worse, without a change to policy settings.  

“Community sector workers and service leaders, about 80 per cent female, are being forced to carry an enormous physical and psychological burden to cover funding shortfalls and ensure people in need can still access essential services,” Goldie said.

“Underfunding issues are being made much worse by the fact that too many community sector organisations are being forced to rely on insecure short-term government contracts. Some of these contracts may last for only a year which makes it extremely difficult to plan ahead or offer any certainty to staff or clients.”  

She said without more stable funding, organisations were unable to offer the job security and career advancement that these workers deserved. 

“Little wonder then that nearly one in three of the people who participated in our survey plan to leave their role in the next year and almost one in 10 are considering leaving their industry altogether,” Goldie said. 

“Community organisations should be able to rely on governments to fund them appropriately so they can provide quality services to all who need them and pay their workers fairly.”

The report found a “refreshed and re-energised relationship” between the sector and government was needed to properly acknowledge and value the central role the sector plays in people’s lives and in creating better public policy.

To secure essential community services, ACOSS is calling for the next government to create a Community Sector Continuity of Service Enabling Fund; improve indexation for community sector funding; conduct an assessment of community need for essential services; and protect people at greatest risk from ongoing health impacts of COVID-19. 

“In this election, we are seeking a commitment from all parties and candidates to address chronic underfunding as a priority to strengthen the resilience of communities,” Goldie said. 

“As a matter of urgency, we are calling for a Community Sector Continuity of Service Enabling Fund to be established to ensure continuity of service delivery, adaptation, secure jobs, prevent loss of jobs or income, and to guarantee paid special leave for all workers, as well as improving indexation for community sector funding.”