1. Sustainable Funding and Contracting with the Not-For-Profit Sector Rebecca Brown Department of the Premier and Cabinet 18 May 2011 1

2. Overview Building a mature relationship with the not-for-profit sector. Sustainable funding for services delivered by the not- for-profit sector. Reforms to the contracting arrangements with the not-for-profit sector. Next steps. 2

3. 3 Meeting the needs of the more disadvantaged and vulnerable in our community. Recognising the important role of the not-for-profit sector in working closely and meeting those needs. Increasingly personalised services designed to meet the needs of individuals and improve outcomes. Public sector to act increasingly as a facilitator of services rather than direct provider. A genuine and collaborative partnership between the Government, and public and not-for-profit sectors. Improving Services and Support for Western Australians

4. 4 Working with the Not-for-Profit Sector Focus on building a more sustainable not-for-profit sector and growing capacity over time. A more mature funding and contracting relationship between the public and not-for-profit sectors. Supporting a not-for-profit sector which is flexible and adaptive in meeting community needs. Shift in focus away from contracting inputs and prescribing service models towards the achievement of outcomes. Reduced administrative burden and red tape for the not-for- profit-sector.

5. Sustainable Funding and Contracting with the Not-For-Profit sector Package of key reforms to cement a genuine partnership between Government, the public sector and not-for-profit sector. Focused on reducing the administrative burden. Support a not-for-profit sector which is flexible and adaptive in meeting community needs. Pay a fair and appropriate price for services purchased from not-for-profit sector organisations. 5

6. 6 Community Sector Funding Need to address the shortfall to ensure sustainability of the not-for- profit sector over time. Partnership Forum provided advice to the Premier on the shortfall late last year. Proposed two stage approach: 1.Upfront flat rate price adjustment for all contracts (Component I). 2.A second increase to be applied as contracts expire (or earlier for high risk contracts), linked to roll-out of procurement reforms (Component II).

7. 7 Draft Delivering Community Services in Partnership Policy & Associated Reforms Overarching policy framework to guide the procurement reforms. Policy designed through extensive collaboration with the public and not-for-profit sectors reflecting ongoing partnership principles. Policy outlines the range of funding and contracting arrangements available and provides guidance on when each should be used. Standard contract templates, conditions and reporting frameworks for both sectors – plus, ‘how to’ practice guides. Oversight and governance for policy implementation rests with the Partnership Forum. Day-to-day policy and practice support from the Department of Finance, Government Procurement.

8. 8 What does this mean for not-for-profit sector organisations? Building the capacity of the not-for-profit sector to understand and tender the sustainable cost of services delivered. Reduced administrative burden through streamlined pre- qualification arrangements and reporting arrangements. Greater capacity to contribute alternative service delivery models based on the sector’s understanding of community needs. More clarity around the nature of the funding and contracting arrangements with government i.e. grants vs service agreements.

9. 9 Implementation Approach Guidance and oversight by the Partnership Forum. Strong engagement and involvement of public sector agencies and not-for-profit sector around the planning and roll-out of these reforms. Ongoing education, training, support and oversight by Dept of Finance – Government Procurement. Current focus on agency preparedness for new contracting arrangements from 2011-12.