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New contract approach transforms Oranga Tamariki partnerships

A move to longer term contracts has been transformational for Oranga Tamariki’s partnerships and the services they deliver to New Zealand communities.

Oranga Tamariki manages around 900 contract arrangements across more than 560 social service partners, many non-profit organisations. Until recently many of these contracts have been on a 12 month financial planning cycle due to budget and policy constraints.

Joe Fowler, General Manager Commissioning, and his team have recently introduced a new approach.

“Our long term relationships were captured in short term contracts. This created an element of uncertainty and huge administrative burden, with the drawing up of multiple contracts for both Oranga Tamariki and our partners. They were spending valuable time on financial administration, rather than focusing on our shared goals,” says Joe.

In October 2017 only 30 per cent of Oranga Tamariki’s contracted funding was in multi-year contracts. In just over six months this has grown to nearly 80 per cent, with most contracts being pushed out to two to three years.

“A long term contract is not just a commitment of funds. The unique nature of social services means that you share goals with an organisation and are committed to working with them. Your contract is a way of capturing that commitment and how those goals are going to be achieved,” says Joe.

Longer term contracts mean social service providers can plan ahead and spend more time on the difference they make with people, families and communities to improve outcomes for New Zealanders.

“We’ve received very positive feedback from our partners,” says Joe.

Joe sees benefits for other agencies extending from short term contracts too, noting that many already have medium term contracts in place.

“Short term contracts create competitive procurement, which in turn drives fragmentation. You end up with a plethora of new organisations, resulting in disjointed services on the ground. Longer term contracts simply make sense.”