Government Funding of Voluntary Social Services


Jones, John Finbar

TitleGovernment Funding of Voluntary Social Services
PublisherSocial Research Center, the Chinese University of Hong Kong
Publication DateJanuary, 1978

Social service

Abstract/ Concluding Remarks:

This study set out to explore: (1) broad policy issues relating to voluntary social service agencies and the use of public funds; (2) general patterns of funding voluntary organizations; (3) Government subvention policy and practice in Hong Kong; (4) a critique of the policy and procedures; and (5) suggested guidelines for change.


In general, the arguments for and against government support for voluntary agencies have turned around questions of agency autonomy, as well as the cost and effectiveness of service delivery. Public funding of private endeavour in the social service field is generally based on the assumption that voluntary organizations can provide certain services more appropriately (an ideological consideration), more efficiently and more effectively.


Supporters of voluntary efforts also point to the flexibility of nongovernmental agencies and their suitability for experimenting. But the pioneering nature of voluntary organizations is disputed, and research does not demonstrate any consistent superiority of private agencies over public departments in this regard.


The objections to public funding of voluntary social services rest on two different premises: first, a government is dodging its responsibility to citizens if it hands over the running of social services to voluntary bodies; secondly, voluntary agencies when they accept government support sacrifice autonomy, especially in the area of social action.


Government purchasing of social services has long been practised throughout the world. Funding methods have included tax concessions, lump-sum grants, subsidies, and per unit or per capita- payments. In Hong Kong, the principal means of subvention have been deficiency and discretionary grants, voluntary social services being subvented almost exclusively through discretionary funding. As Government has over the years assumed the role of chief provider of funds for social welfare, the policy and practice of discretionary grants have come in for increasing criticism.


The main objection Government has to lump-sum discretionary grants appears to be the lack of accountability inherent in the method, while the voluntary sector is dissatisfied with the present manner of determining the one-line vote for the social welfare subvention. The process whereby individual subventions are made and the role of the Social Welfare Advisory Committee in the process are also matters of concern.


An analysis of present procedure of subventing voluntary social services suggests the need to modify Government subvention policy and to alter the manner in which, the Social Welfare Advisory Committee undertakes its work. The guidelines outlined in Chapter VII assume that the structure, the method of appointing members and the terms of reference of SWAC could remain unchanged and still permit the implementation of certain proposals.


Following the recommendations of the Hong Kong Council of Social Service·s vlorking Party on Subvention Policy, guidelines for change have been suggested, which fall into three categories: 1. guidelines relating to need, priority and quality of services; 2. Guidelines relating to the classification of services; and 3. Guidelines relating to work of the Social Welfare advisory Committee.


1. In formulating the working figure for social welfare for a particular year, there is needed to provide for both the maintenance and expansion of services.

A. Provision for the maintenance of existing services involves:

(i) The one-line vote of the previous year;

(ii) Annual increments of staff salaries and their recognized adjustments;

(iii) Inflation and increase of rent and rates.

B. Provision for the expansion of existing services and proposed new ones involves:

(i) Projects committed in the Annual Review of the Five Year Plan;

(ii) Projects committed in Programme Plans

2. Services should be classified as contractual, non-contractual, and experimental.

(i) Contractual services should initially include creches, nurseries, old age homes and child care institutions. Subventions should be based on a subsidy code (unit cost) according to an agreed standard. Salaries of workers should be covered by subvention and equal to those of Government counterparts.

(ii) Non-contractual services should remain discretionary. There should be triennium block-grant planning for non-contractual services stating the level of Government support. Salaries of workers should be equal to those of Government counterparts, and the Social Welfare Advisory Committee should ensure parity over a phased-in period.

(iii) Experimental projects need not be funded by Government. Such projects might more appropriately be funded by the Lotteries Fund and the Community Chest. If this were the case, it would first be necessary to clarify the relationship between Lotteries and Chest allocations. The seesawing effect of subvention and Chest allocations should be resolved.


3. The composition and procedures of the Social Welfare Advisory Committee should be changed to make promote expertise, efficiency, and accountability.

(i) The composition of the Social Welfare Advisory Committee should consist of a majority of members from the voluntary agencies.

(ii) SWAC should be involved in the estimation of the one-line vote figure before it goes to the Finance Branch of the Secretariat, and SWAC should be consulted prior to a formal decision.

(iii) Sub-committees for specific areas of service should be formed in SWAC. Their responsibility might include the analysis of policy and the establishment of guidelines for subventing areas of service, as well as the screening of applications by particular agencies. While these sub-committees would aid in facilitating communications and in fost8ring understanding of agency problems, they should not take over the prerogative of SWAC itself -- the making of final recommendations.

(iv) SWAC should conduct open hearings for the benefit of the voluntary agencies and their clients. Its information should be made available to the public. Policy research, when purely an academic exercise, has limited relevance. This study was undertaken simultaneously with the endeavors of the Working Party on Subvention Policy of the Hong Kong Council of Social Service to examine existing policy and to come up with proposals for change. Because of these circumstances, a final question can be raised here. How far is the Hong Kong Government likely to modify subvention policy and practice?

There are indications that some changes are certain to occur while others are in doubt. The present trend is to move towards contract for service in four areas, viz., creches, nurseries, old age homes and child care. The Social Welfare Advisory Committee is likely to assume a more active advisory role. It will be consulted on the preparation of the Five Year Forecast on Social Welfare Subvention and on the one-line vote working figure on subvention. In some other respects, change appears unlikely. There is no indication that Government is as dissatisfied with the composition of SWAC as the voluntary agencies are. And, while SWAC keeps its present shape, the voluntary agencies have little reason to hope that some of their more urgent needs will be met. Accountability, for instance, which could be promoted among SWAC's natural constituents by holding open meetings is as likely as in the past to be down-played. There is no indication at present that SWAC will conduct its business in open meetings or institute a sub-committee structure that would include representatives from the voluntary agencies.

NoteIncludes bibliographical references
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