The New Public Management reform of state-funded social service nonprofit organizations and the changing politics of welfare in Hong Kong

Abstract

What are the political impact and significance of New Public Management (NPM) reform on social service nonprofit organizations (NPOs) in Hong Kong? Social service NPOs have a long history as a significant part of Hong Kong's 'welfare mix', not only in their role as state agents in the provision of service, but also because of their political and societal roles in affecting social policy making during the colonial era. The exercise of such agencies under an authoritarian setting was made possible through a governance regime historically formed under the peculiar situation of the old politics of welfare. The NPM reform and the associated governance regime change is a significant part of the new politics of welfare that has arisen with the dissolution of the old social pact. It facilitates the transition of the governance regime from strategic partnership to executive dominance, which maximizes the flexibility of the state in containing social spending and maneuvering the new distributive politics arising from the increasing societal demand for social care. Points for practitionersThe NPM reform of social service NPOs is closely tied to the change in the welfare system and has significant impact on the environment within which these NPOs operate. The impact and significance of reform is also affected by the characteristics of the political system and the preexisting relationship between the state and the nonprofit sector. Social service NPOs assume multiple roles as state agents, political agents, and societal agents. In Hong Kong, NPM reform unfavorably affects the space for NPOs to exercise their societal agency. The fierce competition for resources also stifles the development of newer organizations.

On the edge: changing geographies of the global city precariat in London and Hong Kong

“…The relatively few distinct civil society organizations relative to the number of facilities dispersed throughout Hong Kong could be explained alternatively as representing a more active role of the state in service provision to resident migrant and ethnic minority populations. This supports Lee's (2012) observation that 90% of social services are provided by non-profit organizations, which are heavily statesubsidized reflecting the interventionist nature of the Hong Kong (and arguably Asian) welfare state. As for London, the state's role regarding work precarious migrants alternates between overbearingness and absence -the topic of further exploration in more detail in DeVerteuil's subsequent paper in this issue -which has led to a proliferation of protective immigrant-serving organizations.…”

“…Hong Kong's approach to welfare and the third sector has been characterized as an Asian 'statist-corporatist' model, which combines "…the interventionist nature of the state, which enjoys a high degree of autonomy vis-à-vis society, tends to limit freedom of association, and shows low commitment to social welfare provision…[with a] high level of participation by designated non-profit organizations in selected areas of social provision under state funding" (Lee, 2005;Lee, 2006;Lee & Hacque, 2008: 98;Wong, 2008). As a result, 90% of Hong Kong's social services are provided by non-profit organizations, albeit heavily state-funded (Lee, 2012). While some areas of Hong Kong social policy lag far behind the UK -such as unemployment benefits and social security -Hong Kong socially houses almost half of its population, which represents the "most significant income redistribution programme through benefits-in-kind" (Lee, 2006: 460).…”

Legitimate Deficit: Competitive Bidding in a Residual and Semi-democratic Welfare Society

“…Before the 1970s, the colonial state played a residual role in relation to the roles of family, community, and market in social welfare on one hand (Chan 2011), and takes initiative in governance such as law-making on the other hand (Lee 2005(Lee , 2012. Limited public resources are invested in social programs annually while the decision-making power is dominated by the state.…”

“…Moreover, they possess good track records as service providers for the elderly. Thus, while all NGOs (including well established and usually larger as well as new usually smaller ones) have an equal chance in competing for other welfare trust funds which are usually of smaller amounts (Lee 2012), traditional, well-established and large-subvented NGOs can defeat newcomers in the zero-sum game of competitive bidding.…”

“…The present study will focus on Hong Kong's experience, which will have significant implication for the world, given that Hong Kong is a typical case of residual welfare society (Chan 2011) and semi-democratic state (Lee 2005(Lee , 2012 that adopts the New Public Management in a society with different historical development and political characteristics. Moreover, treating Hong Kong's competitive bidding as part of the global diffusion of New Public Management reform since the 1980s, the present study goes beyond previous research by examining competitive bidding from a neglected perspective, namely the policy network and instrument theory (Salamon 2002).…”