Public Policy Trends and Instruments supporting the Social Economy: International Experiences

A recently published paper on how public policy can aid in the development of alternative economies. Introduction below. To read the full text see http://www.socialeconomyhub.ca/sites/default/files/Crystal%27sPaper2_0.pdf
By Crystal Tremblay

1.0 Introduction: Building an alternative economy

The purpose of this paper is to highlight public policy trends and instruments from around the world that are meeting the socio-economic and environmental outcomes fostered in the Social Economy (SE). This paper (the second in a three part series) is intended to compliment the literature review titled “Advancing the Social Economy for socio-economic development: International perspectives”, by presenting specific policy instruments that are being applied by governments to support the Social Economy in producing public policy outcomes that respond to the social, economic and environmental challenges they and their citizens face. The literature review suggests that explicit and far-reaching public policy frameworks and instruments to enable the Social Economy to take action on a broad range of social, economic and environmental issues have had the greatest public policy outcomes. Where governments have fragmented or non-explicit approaches to the Social Economy as a means to achieving socio-economic policy objectives, there has been greater difficulty for actors in the Social Economy to maximise their outcomes for the public good and organize their activities across a range of sub sectors with shared goals. In highlighting successful innovative policy instruments therefore, this paper provides a foundation for discussion and analysis of policy and practice that can advance the Social Economy in Canada.

The Social Economy as a public policy focus has historically been driven by social movement action to create solutions and influence government policy (Poirier, 2008). It is in this context that trends in public policy are conceptualized as part of efforts to reconstitute the social construction of economic activities. The concept of policy instruments comes from recent literature on public policy and can be defined as “strategies and resources employed by governments to facilitate designated ends and goals vis-à-vis target populations” (Harman, 2004; p.1). The central idea behind theory on policy instruments is that governments can act through different instruments to achieve particular goals, and that the instruments chosen are important because they usually involve significantly different policy-making processes and produce different effects (Peters & Van Nispen, 2001). Public policy seeks to achieve goals that are considered to be in the best interest of the whole society, often by targeting specific groups within society (Torjman, 2005).

Because Social Economy organizations are by most definitions actors in the Social Economy, their efforts at the co-production and co-construction of policy is important to any analysis of trends and development in public policy. Vaillancourt (2008) defines co-production as the “participation by stakeholders from civil society and the market in the implementation of public policy”, while co-construction refers to “participation by those very stakeholders in the design of public policy” (p.12). Guy and Henneberry (2009) also embrace the public–private partnership or ‘collaboration’ between government and civil society “in building an inclusive and effective Social Economy network because it utilizes assets from a number of different economic sectors and therefore has the potential to be more efficient for each partner” (p.4). On addressing this evolving partnership, Kwan (2002) points to a “new and dynamic balance in which government and the third sector can work more closely together to find innovative, cost-efficient ways of delivering public services that are essential to Canadian communities” (p. 164).

The literature reveals numerous examples of Social Economy organizations successfully delivering public services. In Germany for example, although the government manages policy analysis and funding, social services are often run by non-profit organizations (Bode & Evers, 2004). Other EU countries are exploring new ways of co-management, where responsibilities are shared among governments, for-profit providers and third-sector organizations (Defourny, 2001). Neamtan (2004) suggests that public administration places insufficient attention on the integration of social, economic, cultural and environmental goals and that the needs of people might be improved through services based on partnerships.

Vaillancourt (2008) also points excellent examples of co-construction and co-production of public policy for social housing in Quebec. One example begins in the 1960’s “when the federal state altered its social housing cost-sharing programs so as to permit the provinces taking advantage of them to develop new social housing units that could come under not only the public sector (i.e., the low-income housing formula) but also housing co-operatives and non-profit organizations (NPO)” (p.31). During this time low-income housing expanded, and the development of housing co-operatives and NPO’s were favored. This trend in Quebec was accentuated with the AccesLogis program in 1997, giving priority to projects from local areas and favoring participation by the Social Economy in the application of public policy on housing. Through this program 20,000 new social housing units were developed from 1997 to 2007, with the vast majority as housing co-operatives and NPO’s.

While the literature points to the valuable role the Social Economy plays in the co-production of policy, Loxley & Simpson (2007) provide a valuable critique regarding the negative implications of off-loading public services to the community sector. They caution that were social service delivery is devolved to the Social Economy, it might be quite consistent with neo-liberalism. “It could, indeed, be a way of reducing public sector employment and public sector wages, with particularly adverse effects on women, who are strongly represented in the public sector” (p.39). Despite the lack of literature and consensus on this debate, the co-construction and production of public policy is an important context for understanding and analysing trends in public policy development for the Social Economy, and where possible references are made to these linkages in the analysis that follows.

This paper outlines several public policy instruments being used by governments around the world to better meet the needs of actors involved in the Social Economy. These instruments range from defining legislation and regulatory measures, to cross-departmental governmental policy frameworks, to specific enabling policies and programs designed to achieve public policy outcomes. In order to obtain improved insight into the characteristics and trends of policy instruments, a typology of five thematic categories are used. This typology is adapted from Neamtam & Downing’s (2005) “Social Economy and Community Economic Development in Canada: Next Steps for Public Policy”, applied as a guide to classify and understand the various policies and their intended outcomes for socio-economic development and environmental sustainability. This paper, commissioned by the Government of Canada, attempted to provide a framework for classifying public policy instruments of direct relevance to the Social Economy in the contemporary governmental environment of the Canadian federal system (2006) and so is used as a basis for analysis. Each typology within this framework is then categorized into policy ‘domains’, or sub components to further highlight the diversity and innovation of policies in this sector. From this typology, conclusions can be drawn concerning future direction for public policy development in Canada for governments at all levels and actors in the Social Economy. The final paper in this series titled “The Social Economy in Canada: Strengthening the Public Policy Environment” highlights policy recommendations based on these trends from around the world.

The framework includes the following policy areas:
• Cross-governmental;
• Territorial;
• Tools for development;
• Sectoral; and
• Supporting disadvantaged communities and populations.

Cross-governmental policies are defined as explicit government-defined policy frameworks to use the Social Economy and enable its actors to achieve socio-economic development goals that cross-governmental departments and mandates. They may include but go beyond any of the following specific policy typologies. Territorial policies can be defined as those public policies that enable “communities to initiate and implement their own solutions to economic problems to build long-term community capacity and foster the integration of economic, social and environmental objectives” (Neamtan & Downing, 2005, p.16). Territorial policies support local communities to create networks, strategic planning processes and collective projects, such as the tripartite support for Community Economic Development corporations in most urban centres in Québec and in some other major Canadian cities (Neamtan & Downing, 2005). These types of policies play an important role in social entrepreneurship by providing a geographic community with funds and support for networking, strategic planning, and collective projects. Social Economy ventures need to have access to suitable tools for development including financing (access to capital), market access, research and development supports, and training and management systems. Sectoral policies often respond to needs that neither the market nor government can satisfy. Polices that support the emergence of Social Economy actors in economic sectors (such the environment, housing, new technologies, communications, food services etc.) are important tools for strengthening the Social Economy. Policies in favour of supporting disadvantaged communities and populations contribute to addressing access, services and employment to marginalized groups. These policies use the Social Economy as a vehicle to integrate citizens with barriers to socio-economic participation.