Speaking Notes
for
the Honourable Diane Finley,
Minister of Human Resources and Skills Development
Addressing Social Challenges by Empowering Individuals and Communities
2012 Manning Networking Conference
March 9, 2012
Ottawa Convention Centre
Ottawa, Ontario
Check against delivery
Good afternoon, and thank you, Nick, for that kind introduction.
I want to also welcome my two respondents, Ray Pennings and Kate Bahen. I know we’re going to have a very interesting discussion and I’m looking forward to hearing your thoughts.
You know, driving over here today, I was reminded of an old joke: A shopkeeper was dismayed when a brand-new business much like his own opened up next door and erected a sign that read, “BEST DEALS.” He was horrified when another competitor opened up on his other side and announced its arrival with an even larger sign, reading, “LOWEST PRICES.” The shopkeeper panicked—until he got an idea. He put the biggest sign of all over his own shop. It read: “MAIN ENTRANCE.”
Now, I tell this story because it relates, in a way, to what I want to talk to you about today: the largely untapped potential for innovation and resilience of local communities.
So let’s get started.
I have, I hope, a fair reputation for being direct.
I say what I mean and mean what I say.
So let me begin by saying some things up front that I believe are important.
I believe the family is the foundation of our society, that no amount of government programming can possibly replace the family in terms of support, caring and growth.
It’s parents who know what’s best for their children, and it’s community leaders who best understand their local challenges, identify solutions and get results.
And I believe that personal responsibility—for the family, for the community, and for our neighbours less fortunate—is vital for giving life dignity, meaning and self-respect.
And, without the hope of dignity, meaning and self-respect—ultimately, no social program will be effective.
I say all this because we have a challenge in this country. And that’s what I want to speak to you about today.
Governments cannot do everything to meet our social challenges.
Governments cannot simply fund every demanded service without regard to the taxpayers’ ability to pay.
Governments can, however, facilitate and empower others to deal with social challenges.
As Ronald Reagan once said:
“The nine most terrifying words in the English language are: I’m from the government and I’m here to help.”
That may be a little harsh—or maybe not. Certainly, complex and persistent social challenges remain despite the various approaches that all levels of government have undertaken. Some have worked and some have not.
Eliminating poverty has been a priority for all governments in the industrialized world—including Canada—and they dedicate a significant portion of their budget resources to reaching that goal.
Governments continue to struggle with complex and persistent social challenges that appear to defy resolution.
When I first was appointed Minister of HRSDC in 2006, and I asked the Department how many homeless we had in this country, I was told 150 000.
Three years later when I was appointed once again as Minister of HRSDC, after spending time as Minister of Citizenship and Immigration, I asked again how many homeless there were and was told… 150 000.
Millions had been spent in pre-existing funding agreements without resulting in substantial change.
Now, let’s be clear on one thing. There are many sincere and dedicated individuals who are working very hard to solve our social problems. They range from governments, to professional organizations, to not-for-profits, to thousands of volunteers just wanting to make a difference.
But it’s also clear that some of the conventional approaches to these problems have not always achieved the results we had hoped for.
To be frank, we can’t do the same thing over and over again and expect different results.
Under these circumstances, innovation is not an option—it’s a necessity.
And one thing must ring true: traditional, single-purpose, government programs do some things well, but cannot address all complex societal challenges.
So, what can be done?
New approaches are needed if we are to make progress.
It’s time for government to reach out to individuals and local communities. It’s time for government to free up individual initiative so those who are motivated can help others and take more responsibility for themselves and their families.
It’s time, as we said in Budget 2011, “...to complement community efforts by encouraging the development of government/community partnerships, enabling communities to tackle local challenges and test new approaches to improve performance.”
RDSP
Government can be extremely effective as a facilitator and motivator.
In 2006—in my first year as Minister and in this government’s first year in office—I, together with Minister Flaherty, had the honour of announcing the Registered Disability Savings Plan (RDSP).
The RDSP helps Canadians with disabilities and their families save for the future. Earnings accumulate tax-free until you take money out of your RDSP. Parents or guardians may open an RDSP for a minor. With written permission from the holder, anyone can contribute to the RDSP.
The RDSP has had a great impact on how the government supports the disabled and has been embraced by the families of the disabled and the community.
Additional progress
Governments can help facilitate activity but, ultimately, we need leadership from innovative not-for-profits, organizations and other non-government entities to build critical momentum around the social economy.
The discussion about social partnerships is moving forward, and there are some exciting conversations starting to happen.
To start with, I established a voluntary advisory panel on social partnerships last year, and have been tremendously encouraged by their work, energy and enthusiasm.
Composed of leaders and innovators from the social finance, not-for-profit and finance communities, they are providing advice on a wide range of topics surrounding new approaches to social challenges.
That includes discussion on social financing—where the private sector and individuals are doing more than supporting social and community organizations. Where instead, they are strategically supporting investing to have greater, measurable impacts.
If you haven’t seen or heard of their work yet, I’d encourage you to check out the Canadian Task Force on Social Finance. The Task Force is seeking to fundamentally change how we think about investing and philanthropy in Canada.
They released a report in 2010, and issued a further progress update last year.
And recently, MaRS in Toronto announced the creation of a National Centre for Impact Investing to act as a social finance hub.
We’re already taking a look at some new ways to initiate innovative funding arrangements as a key component of the broader Social Partnerships Strategy. This includes looking at things such as pay-for-performance agreements, which tie funding to measurable results.
Full funding is only paid out when targets are met, and higher payouts are provided when targets are exceeded.
Partnerships with the private sector
We are already seeing innovation in funding strategies from many not-for-profits that are actively seeking other partners to support their work and ensuring that their funding dollars have maximum impact.
Getting the private sector involved in addressing social challenges will bring new perspectives and approaches.
Some of the best practices in the private sector could certainly work in not-for-profits.
Let me say that it’s absolutely wrong to dismiss business people as interested only in short-term gains and unwilling to invest in the community.
We’ve all heard about corporate philanthropy at the level of the Bill and Melinda Gates Foundation.
But the reality is that it isn’t just the mega-corporations that sponsor worthy causes.
Even the smallest towns in Canada usually have a local business owner who buys equipment for a children’s sports team, donates old computers to the high school, provides meaningful work experience for people with disabilities, does free household repairs for the elderly, and so on.
The willingness to serve is already there in our business community—we just need to channel it better.
SIBs
As we continue to explore this topic, we’ve discovered there are a number of innovative funding arrangements that are social finance tools. While inLondonlast fall, meeting with a number of global social finance leaders, one example we learned about was the Social Impact Bond.
A social impact bond is a contract between the government and private investors in which the private investors provide up-front capital to finance an organization—often a not-for-profit—to deliver a social program.
Payment from the government is tied to program outcomes. If—and only if—the agreed-upon outcomes are achieved, the government pays the investors the agreed premium, as well as the original investment.
In addition to leveraging local and private-sector expertise, essentially, the Social Impact Bond has the effect of moving risk from the current state of affairs—where government (and taxpayers) pay up front without a real way of guaranteeing performance—to the social group itself, which will be “paid for results.” The investors win, the community groups that are successful win, the recipients and users of the service win and the taxpayers win.
The way forward is not without its own challenges.
For programs such as social impact bonds to work, the program has to have clear, measurable outcomes and a clear payment structure aligned to established targets. And those targets themselves will have to be transparent and be, in effect, “substantial” targets.
Government, in protecting taxpayers’ investments, will have to have a rigorous method of evaluation.
But perhaps one of the most significant challenges lies in the very nature of government partnering with non-governmental groups to provide social services. When government partners with a small social service agency, does that truly empower that agency and enable it to do “good work”? Or does the act of partnering simply extend the reach of government and bureaucratic practice further into the volunteer and non-governmental sector, creating dependence rather than empowerment?
The answer, I believe, is that it depends how the facilitating, enabling and partnering is done and the intent of the government doing so.
That’s why our approach will be incremental, respectful of the government’s fiscal situation. The government cannot afford to do everything and we will need to leverage whatever we can for maximum impact.
Conclusion
Margaret Thatcher once said that a nation, “grows and develops by means of countless decisions taken by ordinary people, in pursuit of their own hopes and dreams.”
And if those dreams are to help their communities, then government should support them.
And if those dreams are to build a better community where those less fortunate are given hope and self-respect, then government should facilitate that.
And if those dreams include taking more personal responsibility for the future for themselves and their families, then government should definitely encourage that.
We will continue to ensure that the vulnerable are protected and that Canadians get the services they need. We’re not relinquishing any of our responsibilities.
What we are doing is creating more space and freedom—with our own “MAIN ENTRANCE” sign like the smart businessman—for good ideas to flourish, and empowering individuals and communities.
Thank you.
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