News

Just before the Christmas break, we adopted a position paper with some propositions on how to ensure sustainable financing for social services. Everywhere in Europe, the demand for social services is growing due to demographic and societal changes, the economic crisis, and increasing rates of unemployment, poverty and social exclusion. At the same time, public budgets are shrinking and expenditure for social services has been cut in many member states, to implement austerity measures.

Private sources are being used to complement public financing for social services. Civil society organisations (CSOs), social economy actors and social enterprises are growing everywhere and many of them provide social services. Competition is rising among service providers, as more businesses are interested in providing social services, at least in some sectors. Governments and the European Commission put pressure on the efficiency and effectiveness of social service delivery.

The aim of this paper is to provide recommendations that identify the key elements for a policy framework that ensures sustainable financing for social services and to help clarify the different roles the public, private and voluntary sectors have to play in this complex scenario.

The paper contains three key political messages:

• No matter whom the provider is or the source of funding used (public or private), member states must retain responsibility for setting the legislative, regulatory and financial frameworks for social services policy to ensure that a profit-making logic does not prevail over the general interest enshrined in the mission of these services. Provision of services must respect users’ human rights and guarantee a high level of quality.

• Public budgets must ensure adequate financial support for the provision of social services, as this represents an effective investment for and an essential element of cohesive and resilient societies. Sources of private funding can complement public budgets especially in the countries hit hardest by the economic crisis. When private funders are involved, public authorities must ensure that donors and investors act in the general interest and that private financing is subject to high transparency requirements.

• When funders, institutions, donors or investors request social impact measurement of a specific service from applicants, it should be possible to choose among existing methodologies and tools to find a measurement technique best suited to the specific service to be funded.

Finally, the paper contains a special focus on social impact investing and on the use of the European Structural and Investment Funds to financially support social services. You can read the full paper here.