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Community sector warns for consequences of increased competition in human services

ACOSS and CHOICE have released a research report that shows the damage of increased competition in human services

A research report into the increased competition into human services has found that it fails to deliver better outcomes for people.

The Competition Policy and Human Services: Where Theory Meets Practice assessed two areas of human service where various combinations of choice, contestability and competition have been significant in recent years – vocational education training (VET) and employment services.

The report, conducted by Australian Council of Social Service (ACOSS) and CHOICE, found that the increased competition in these two sectors has failed to deliver better outcomes for consumer and has also led to major barriers to improving collaboration.

Dr Cassandra Goldie, CEO of ACOSS, said: “The report’s findings show there are significant risks in introducing further competition into human services, particularly as the benefit to people is doubtful, and is not evident in these two examples.

“Where competition has been introduced in vocational education and training, it’s led to rising costs, people being placed in inappropriate courses through aggressive sales practices, and a significant reduction in quality across the sector.”

Within the VET sector, it is argued that private providers have been able to both engage in inappropriate selling tactics whilst also cherry picking high-profit/low-cost course. At the same time, TAFE is required to both innovate and offer news services whilst also providing high investment/low return training needs, and servicing non-commercial markets.

Regarding the provision of employment services and the government outsourcing of such services to the unemployed ACOSS CEO Dr Cassandra Goldie states that:

Goldie also argued that in employment services, “‘marketised’ service delivery has led to private providers focusing their efforts on people who are job-ready rather than people who need more assistance”.

“Further, choice for people who are unemployed is severely restricted by the harsh benefit compliance system, which employment service providers play a major role in administering. The current model of employment services, and its predecessors, have left people behind,” Goldie continued.

“We need to seriously rethink the competition agenda in human services, to ensure we don’t keep making the same mistakes in service delivery that can have a devastating impact on people.

Alan Kirkland, CEO of CHOICE said:

“This report reinforces the fact that competition should only be pursued where it is going to lead to better outcomes for consumers.

“Introducing competition into sectors like vocational education and training appears unlikely to help consumers, and could in fact be harmful.

“Our first priority should always be to ensure that people have equitable access to good quality services. Competition, especially where it involves for-profit service providers, should only be pursued where it will help achieve this.”

For the full report

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