Comparing Government Social Welfare Service Acquisition Regimes: Marketisation and Bases for Competition in Canadian and English Homelessness

Abstract

AbstractWhen governments acquire third-party social welfare services (SWS), they create institutions of acquisition. The rules and practices that governments adopt define who is able to participate, on what basis, and how prices are determined. This paper conceptualizes the institutions of SWS acquisition, their variations, and implications, in order to contribute to a deeper understanding of the link between contracting and nonprofit commercialisation. Institutions of SWS acquisition include rules of entry, participation, and assessment. Resulting acquisition regimes can be marketised to a greater or lesser extent, and this is influential through its effect on nonprofit competition. Drawing on interviews with public servants and nonprofit staff, the paper compares acquisition regimes for homelessness services in England, a regime that closely resembles a market, and Canada, a regime which is not marketised. In contrast to their non-marketised counterparts, this paper finds that marketised SWS acquisition regimes create incentives for participants to reduce prices by loss-leading or ratcheting down service quality.