Outsourcing child welfare? Where will the madness end?



When it comes to the privatisation of public services I thought nothing could worry me more than what is being done to education and prison systems worldwide, but I am beyond alarmed to read in today’s Guardian that the Department for Education in the UK is seriously considering privatising their version of CYFS.

To put such sensitive matters into the hands of companies with a profit motive is frighteningly foolish.

The Guardian reports:

Professor Eileen Munro, whom Gove commissioned to carry out an independent review of child protection published in 2011, said establishing a market in child protection would create perverse incentives for private companies to either take more children into care or leave too many languishing with dangerous families.

“It’s a bad idea,” she told the Guardian. “It’s the state’s responsibility to protect people from maltreatment. It should not be delegated to a profit-making organisation.””

Let’s just be clear on what privatisation of public systems can do:


public privateIn England, G4S was fined for overcharging on a contract to tag offenders. Bad enough – but privatising prisons in the USA lead to astounding corruption where two judges were taking bribes amounting to tens of millions of dollars from PA Child Care and Western PA Child Care detention centres to jail children.  The Cash for Kids scandal saw over 6000 children jailed after improper trails – 4000 convictions had to be overturned – and this is in just one courtroom.  All because a greedy company needed more ‘customers’ to make more profit and was happy to wrongly jail children in order to create the demand.

It doesn’t end there.

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Privatising public schools has lead to all manner of problems in the UK and the USA.  Fraud cases turn up weekly, schools being closed because they promise more than they deliver, schools with barely any pupils, students that don’t exist on the books and receiving funding, and the huge attrition rates, especially for special needs or other students that are deemed to be more difficult to teach.  Who cares about the students themselves?  What matters, it seems, is profit, and therefore image is more important than fact and far, far more important than the students themselves.


Privatising the mass testing of school children (rather than in-class testing by teachers) is costing millions in the USA and in Australia, for example.  Pearson make a mint.  Parents and teachers are leading huge protests.  The children are stressed. But the money-making machine rolls on.  Pearson now have their hands on myriad areas of education, not least of all standardised testing, school books, a computer-based curriculum for secondary schools, PISA testing, and are investing in private schools – just consider the number of conflicts there.  But again, money trumps all.

Our Most Vulnerable

And now child protection services is to be next.  I am doubly fearful because any half-baked ideas that the USA and UK have undertaken have turned up in Aotearoa not that long afterwards.  Charter schools, private prisons, and we are well on the road to this government forcing standardised testing on us.  I dread to think what the privatisation of CYFS would do for our vulnerable youngsters.

There are real dangers of introducing the profit element into vital public services.  You make these service into for-profit businesses, you create a demand, and you distort the focus of those providing the service.  At that point it is no longer a public service, it’s just a business.

As Professor Munro said: “It’s the state’s responsibility to protect people from maltreatment. It should not be delegated to a profit-making organisation.”

Aotearoa beware.




  1. With the privatisation of services, accountability of politicians can be watered down, fudged and distanced. “Not operating according to their contract” sees blame shifted. Getting rid of lots of possible serious headaches for the chance of less minor ones is good politics.

    And yet is plainly not right. So which path would Steven Joyce and Bill English and John Key choose? Ummmm….

  2. Worse still is that Charter Schools – National/ACT’s subsidisation of private education firms – will not be publicly accountable by way of OIA requests. And the Ombudsman’s office would have only partial jurisdiction to act.

    When taxpayers’ money is used, the public deserve transparency where that money is going.

    I suspect that the privatisation of child protection services would also full in the same trap.

    A Labour-Green government can only respond by telling the public what is happening and by rolling back the Charter School rort.

    Unfortunately, State funding of private schools has wedged the door open for State subsidies to private institutions.

    If private firms want to set up a school or hospital or whatever – that is their business. But expecting handouts and subsidies from the taxpayer makes a mockery of the so-called “free” market.

    But then, this is the government that subsidises smelters, movie companies, sports tournaments, airlines, etc.

    If Labour did it, the Right would be having fits!

  3. Children who have already been let down by their primary caregivers deserve the full protection of the wider community. However, the mindset that sees our most vulnerable young treated as chattels in entities aimed at profiteering fits frighteningly well with the “business friendly” approach of this government. One can just imagine this policy cropping up after the election (if it goes to the current administration), perhaps at first under the guise of Whanau Ora, to make it harder for the left to criticise…

  4. re. Privatised Prisons …
    What should disturb us even more is that prisoners have become a commodity, thanks to the growing relationship between private prisons and state governments. The states that go into business with for-profit prisons sign contracts that essentially agree to maintain quotas on the number of prisoners. If they can’t keep the prison populations at the agreed upon levels, the states must pay the difference.”


  5. Seriously scary stuff Dianne, and one wonders if government continually under resourcing departments like CYFs, rendering them measurably dyfunctional, is cynical preparation for privatisation.

    Your list of other areas of government responsibility that have been privatised has one glaring ommission. Disability Support Services.

    • Rosemary, can you tell me more about what’s happened there? I know a friend of mine has been left hanging without proper help and support for well over a year after losing a leg – when was Disability Support Services privatised and how did things change?

  6. We are ALL a COMMODITY now, there is no doubt about it, under the systems we have. Yes, logically, they will NOT exempt little children, and we follow the UK in too much:

    To appear as a comment on THE WIRELESS tomorrow, I hope:

    See the link to a recent post there, giving too much “credit” to MSD and WINZ –


    the MSD spokespersons and managers have their answers and comments on problems that many beneficiaries experience day in and out, but they do not convince me.

    What the welfare reforms are about, and what few in the public know about, is a totally new approach to medical conditions and work ability, and how this is being assessed. Having been advised by “experts” from the UK, of whom a leading one was Mansel Aylward, they have basically taken over the same approach used in UK welfare reforms.

    There reforms have failed abysmally, even led to self harm, suicide and early death of hundreds if not thousands. They now look at what persons “can do” rather than what they “cannot do”, and so traditional medical assessments are questions, and new additional assessments have been brought in, also provided now by outsourced, private providers, earning nice fees for this.

    MSD employ a Principal Health Advisor by the name of Dr David Bratt, who is a faithful follower of the approach recommended by Aylward and others, and who even likens benefit dependence to “drug dependence”. There have already been issues with “designated doctors” WINZ use, now we can expect further issues with the “work ability assessment” providers, who are not quite that what many may think.

    Self assessment forms are just part of wider information WINZ use to assess the ability of clients with health conditions and disability to work. They will prove to be of limited importance in the end, given the “subjective” nature of them.

    More on all this can be found here:



    Also essential material to study is found here:




    Regards – Marcus”

  7. Dianne – One of the things Ive noted that seems very common with social comentators is that they never seem to stop and “wonder why”.

    Put aside for a moment thoughts about whether going private is good or bad and ask “Why are so many administrations trying the ‘private’ method of management?”

    There are actually quite a few answers. They are all based on the demonstrable fact that the existing systems (mostly public) either dont work , or are seemingly at the limit of their performance.
    The example of charter schools is a good one. After spending millions of dollars over more than 20 years in both general education and on maori initiatives, the ‘failing tail’ of about 20% just wasnt being reduced. The only call from the education sector was “gives us more money” but if that was going to work, something would have come out of the millions already spent – but nothing was changing.
    In my view its a duty of government to try somehing new when its apparent that the old methods seem to have run their course.
    This isnt an arguement in favour or against charter schools – but something had to be changed to try get that 20% of failures down.

    One of the growing challenges in the public sector are the limits that are constantly being applied and increased to performance of the public sector. In an increasing politically correct world and with organisations like the UN endlessly coming out with new demands and limits on government actions, its forcing public sector organisations to spend most of their time and resources on compliance and risk avoidance before they actually start to do anything about the basic function they are supposed to be doing for society. This is certainly the case in child welfare and prisons.

    By the time CYFS comply with all the regulations and requirments of the administration system and the processes they have to follow – theres not a lot of time left to actually apply their time and resouces to children in need. Its one of the underlying reason for welfare delivery being changed in the Whanau Ora system – They can in a large measure dispense with the administrative red tape that CYFS has to put up with. Like charter Schools though – the success or otherwise of this has yet to be shown to be at least as good as and hopefully better than the systems it replaces.

    Yes – there are bound to be some problems with these new systems – (as though there arent problems with existing public sector systems!) – but governments are duty bound to try new initiatives when current processes seems to have reached their limits.

    There is no doubt that existing prison systems are not getting any better, that child welfare isnt improving, that the education system is still producing 20% failures, etc. And these areas have to improve – and throwing more money at them hasnt helped either; so sometimes something new has to be tried.

    • Barry, the things to consider are:
      – trying something new need not equal privatisation. There are initiatives to be tried that do not involve privatisation.
      – why would privatisation itself make things better?
      – why does government put barriers up for non-privatised initiatives but go all guns to support privatised ones?

      It rather points to the fact that privatisation *itself* is the goal.

      Taking charter schools as an example, after twenty years of them in the USA they are only just equalling state school performance. In England a larger proportion of charters are failing OFSTED (their ERO) than state schools. Sure some are great, some are okay and some are doing poorly, but the point is that there is a larger failure rate of these schools than state schools. And the mismanagement cases ar rife. Not to mention attrition rates for students deemed too tricky (and by too tricky I mean they might being down the charter’s average test score), so they are shuffled off back to the public system. Privatisation of that system has not improved it. What it has done, however, is put trillions (and yes I do mean trillions) of dollars into the pockets of reformers like Rupert Murdoch and Pearson.

      For our own charter schools, ask yourself why they are being funded so much more highly than state schools? Could it be they are being made to succeed at whatever cost? Why would that be? Would that funding be sustained if there are lots more charters? There is more to all of this than meets the eye, and little of it has to do with improving the education system.

      Ditto prisons, school tests and child welfare. Follow the money.

      Change is necessary, improvement is necessary, privatisation of key state services is a choice, and in my opinion a bad one.

      • It should also be noted that the red tape is put there by government. If they want to improve the system, then look at it and simplify/improve it. It’s that easy.

        • Well – several points:

          1. At least you do recognise that govt depts are full of red tape (most of which originates at the UN – and due to being a memebr of that organisation- the govt sooner or later has to enact these -usually silly – regulations.)

          2. To assume that Govt depts dont have management problems is naive.

          3. Even if some charter schools work – then thats an improvement. Maybe just a few will get the failing tail down to 15%. Then the natural course of things is that the systems that dont work are sorted out and the systems that are working used more widely. Its this part that hasnt been encted in the US & the UK – mainly due to the fact that education in those countries is not federal – but local government controlled.

          4. I know a woman who is a manager in Work & Income – and she says that its accepted within the dept that around 40% of their resources (time and money) is devoted to compliance with regulations. What a waste.

          • Quote:
            “1. At least you do recognise that govt depts are full of red tape (most of which originates at the UN – and due to being a memebr of that organisation- the govt sooner or later has to enact these -usually silly – regulations.)”

            So it is all the fault of the UN now?

            Where do you get this “logic” from? The UN was established with the best of intentions, to prevent war and to improve the lot of many on the planet. Sadly they have their won bureaucracy, and as it is an organisation made up of about 200 represented member countries, and is basically controlled by the largest donors and the few countries sitting on the Security Council, there are admittedly flaws.

            But without the UN there would be no food and other aid to poor countries, no coordinated international efforts in many places, and it would be each country (and their representative bureaucracies) against each other.

            There are UN conventions that countries can sign up to, that is their governments, and New Zealand has done so. That includes such for the rights of children and also for disabled. That does not mean that UN rules are simply forced upon us, it was our government signing conventions voluntarily.

            I bet you that there is more bureaucracy created in New Zealand that has nothing to do with the UN.

            If only people like you, Barry, would understand the complex relationships that exist, and stop simply lablelling the UN as nothing better than a failure, and see what they actually do, then we may get some more common sense in discussions.

            As for your point or argument 4., WINZ or MSD themselves make many regulations and rules, and the law that binds them is usually developed in their top echelons, by their own policy “advisors” and so. The government usually consults them to make new laws. So when you say that compliance uses so many resources, it is likely the many rules that WINZ and MSD themselves have imposed on their staff.

          • The global reputation of charter schools is however deservedly poor. The successful minority are education driven – the NZ ones are instead on the unsuccessful corporate model.

            A real charter school might want unregistered teachers if they can obtain people with stellar subject knowledge. The current NZ model just wants cheap and vaguely mammalian – there is no advantage to students from this and they should be defunded.

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