Civil society organisations in contemporary social markets

In most welfare states, civil society organisations have always played a major role in the governance and delivery of social (security) services. Nowadays, many of these type of organisations are in trouble. One of the reasons attributed for this is the diminishing legitimacy of such organisations, caused by factors such as secularisation, 'depillerization', and individualism. In our view the demise of the traditional role of social society organisation in the delivery of social services is also linked to another factor, i.e. the emergence of social markets. The term social markets is used here to denote quasi-markets a particular mode of governance whereby states organise social services through third parties which compete for governmental contracts, subsidies, rights of privileges (cf. Le Grand 1991 and 2008; Vonk and Tollenaar 2010). The third parties are not only not for profit organisations operating in the domain of civil society but are also commercial private organisations. As a result of the competition, the not for profit organisations tend to behave like commercial entrepreneurs, by introducing new forms of management, enlarging the scales of operation and entering into new profitable activities. In doing so they lose their original flavour and character. The law within which the organisations operate tends to strengthen this process, as many free market regulation tends to be based upon a rigid public/private divide and does not take into account hybrid characteristics which pertain to socials society organisations. One step towards the market, implies that a legal transfer from public to private; civil societies organisations are treated as commercial enterprises.

Paradoxically, social markets may also give rise to new civil society groups often operating on behalf of clients, thereby representing the “consumer interests”. The role of these new organisations and their impact upon the quality of the social markets is still evolving.

This paper discusses the relation between civil society organisations and social markets in twofold manner, by raising the question of

• how social markets impact upon the evolution of civil society organisations
• how civil society organisations can help to improve the quality of social markets

In the first paragraph we discuss how the social market model threatens traditional not for profit organisations and simultaneously gives rise to new civil society initiatives. Our theories in this respect are illustrated by four cases studies drawn from the situation in the Netherlands. We will look at the demise of two traditional organisations and the emergence of two new initiatives operating in the social housing sector and in the medical/home care sector. These are:

• Rochdale , a housing co-operation which has collapsed under its commercial ambitions versus the woonbond, a new alternative interest group representing the interest of tenants in the rental sector and
• Meavita, a commercial home care group which arose out of the merger of some former civil society organisations which went bankrupt in 2009 versus Per Saldo a new initiative for the protection of the interests of clients in the home care sector

The second paragraph contains some theoretical normative observations. It is argued that the success of the social market model depends upon a strong input of social society initiatives which represent the interests of the stakeholders, i.e. the clients and the workers.

In the third and final part we will discuss how the role of new civil society organisations can be embedded in the law and institutional arrangements. It is argued that consumer organisations should be consulted in important government decisions to grant advantages to third parties and for that purpose should be able to access all information that is that is available to government and private contracting parties so as to be able to allow their watchdog function. In the meantime, the special position of old civil society organisations which are active in delivery of social services should be given better legislative protection.

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