International Journal of Business

Management & Research (IJBMR)

ISSN(P): 2249-6920; ISSN(E): 2249-8036
Vol. 6, Issue 5, Oct 2016, 1-14
TJPRC Pvt. Ltd.

GOVERNANCE OF GOVERNMENT-THIRD SECTOR PARTNERSHIPS

FOR PUBLIC SERVICES DELIVERY
SANJEEV KUMAR SINGHAL1 & PRABHAKAR JHA2
1
2

Department of Home (Police), Patna, Bihar, India

Professor, Department of PMIR, Patna University, Bihar, India

ABSTRACT
Recent developments have seen a paradigmatic shift from the governance of traditional mode of public services
delivery as reflected in the Public Administration towards governance of partnerships involving government and
private/non-profit sector including third sector organizations. The changing nature of the state and dynamics of
governance models is at the helm of the thought process of policy makers and reformers in order to address country
specific problems related to public services delivery. India being a democratic welfare state with meagre economic growth
trajectory needs a revolution in the effective public services delivery in order to achieve all the targets of millennium
development goals especially, to empower its citizens and improving their quality of life in terms of their education, health

responsibility seems to be difficult to achieve considering the ever growing expectations of the citizens and these call for
immediate solutions. Many countries have already initiated the Government-Third Sector Partnerships form of
governance and are delivering requisite public services efficiently and effectively to all their citizen beneficiaries. This
paper attempts to provide an insight into the issues relating to Governance of Government-Third Sector Partnerships for
public services delivery. Further the study also focuses on a few select countries to understand global perspectives on the
contentious issues of delivery of public services in a democratic welfare state like India through case study research

Original Article

and social security needs. The government approach to provide services to all its citizens from cradle to grave as its

methodology.
KEYWORDS: Governance, Forms of Governance, Third-Sector Organizations, Partnerships, New Public Governance

Received: Aug 19, 2016; Accepted: Sep 06, 2016; Published: Sep 12, 2016; Paper Id.: IJBMROCT20161

INTRODUCTION
An Insight of Transition from Public Management to Public Governance
Governance through various Central and State Laws and Regulatory bodies often face challenges due to
the changing dynamics of numerous societal problems in a democratic welfare state. These problems mostly relate
to public services provision and their delivery in the realm of education, health and social services which are
essential for the citizens. The emerging complexity of these problems call for innovative and partnership
approaches for their effective provision and delivery. The pattern and exercise of state authority is changing from
government (rowing) to governance (steering). Traditional Command and Control state which depends more on
regulating behaviour of the citizens by resorting to hard laws is seeing a paradigmatic shift towards a Regulatory
State which steers the behaviour of citizens through the promulgation of soft laws. Various forms of governance
mechanisms are being practiced across the world for better serving the citizen beneficiaries such as New Public
Management (NPM), Corporate Governance (CG), Good Governance, New Public Governance (NPG), Relational
Governance (RG) and Network Governance (NG) where the involvement of voluntary/third sector organizations

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Sanjeev Kumar Singhal & Prabhakar Jha

are playing pivotal role.

Historical Perspective
The public management has witnessed four distinct stages of development starting from the late 19th century on
wards (Stephen P. Osborne, 2001). In the late 19th century the majority of public services were located in the charitable
sector or through private provision, government involvement was at best minimal. Subsequently, there was a shift towards
unequal partnership between government and the charitable and private sectors characterized by recasting of social and
economic problems as societal issues concerning everyone. The legitimate role of the state was recognized in providing at
least some public services, such as sanitation, clean air, national defence etc. and where the state did not provide public
services, it needed to enter into a partnership with the charitable and private sectors for their provision though this
partnership was to be very much an unequal partnership, with the state as the senior partner. The third stage of public
management extending from 1945 through to the 1980s is that of the welfare state which underpinned that charitable and
private provision of public services had failed because of their fragmentation and duplication, and due to their inefficient
and ineffective management. Consequently, government was to meet all the needs of its citizens from the cradle to the
grave and these services became managed by a professional cadre of public servants, organized along Weberian concept
of bureaucracy. The final stage, to date, is that of the plural state as the welfare state was confronted with many of its
associated dissatisfactions. The welfare state had always focused upon the provision of a minimum standard of service to
all citizens. By the late twentieth century, the perceived needs of citizens moved away from a concern with a basic level of
service for all towards service designed to meet individual needs. Moreover, service users increasingly demanded a greater
say in the design and delivery of their public services, as well as a desire for greater choice. Finally, the professional cadres
who had long provided public services were being regarded as inefficient and ineffective and more concerned with their
own needs than those of their service users as public sector trade unions put the needs of their members above those of the
local community. The response to these problems was the market discipline as the solution to the ills of the public sector as
marketization was held to promote the efficient and effective provision of public services whilst promoting responsiveness
to individual needs and greater user choice in service provision thus giving rise to New Public Management (NPM). The
NPM assumed the superiority of the private sector management techniques above those of the public sector and public
administration.
The organizational form created under the NPM paradigm is increasingly becoming insufficient for public
services delivery due to its focus on intra-organizational approach, management by objectives, performance controls, target
fixing and contradiction between competition and steering. This requires considering change from NPM to other forms of
governance as reflected in network form of governance which include inter-organizational collaborations and partnerships,
Corporate Governance, Good Governance, New Public Governance and Relational Governance depending on the needs
and circumstances. All these forms of governance focus on partnerships of public, private and voluntary sector agencies for
the delivery of public services. In particular, the New Public Governance (NPG) entails both a plural state, where multiple
interdependent actors contribute to the delivery of public services through network coordination, and a pluralist state,
where public policy making involve multiple processes.

Impact Factor (JCC): 5.4362

NAAS Rating: 3.07

Governance of Government-Third Sector Partnerships for Public Services Delivery

LITERATURE REVIEW
Defining Governance
As per Oxford English Dictionary, Governance is the action or manner of governing i.e. of directing, guiding or
regulating individuals, organizations, nations, or multinational associations-public, private or both in conduct or actions. It
may also be defined as the general exercise of authority(W. Michalski & Stevens, 2001) where authority refers to
institutions, public or private or both for maintaining control and enforcing accountability. It also refers to changing
boundaries between public, private, and voluntary sectors, and to the changing role of the state (Levi-Faur, 2012).
Thus governance is a complex process and is context specific; there is no one ideal type of governance rather
there are forms of governance each highlighting context specific elements.
Governance networks may be defined as a horizontal articulation of interdependent, but operationally
autonomous, actors from the public and/or private sector who interact with one another through ongoing negotiations that
take place within a regulative, normative, cognitive, and imaginary framework; facilities self-regulation in the shadow of
hierarchy; and contribute to the production of public regulation in the board sense of the term(Sorensen & Torfing,
2007).
Governance refers to the interaction processes taking place among various actors within such networks with the
following characteristics (Koppenjan & Klijn, 2004):

Strong focus on the inter-organizational dimension of policy-making and service delivery with interdependencies
of organizations in achieving such aims.

Horizontal types of steering for stimulating cooperation and support by societal actors for a common
cause/objective.

Participation of societal actors with their diversified knowledge leading to innovative policy formulation and
public services delivery.

Initial involvement of societal actors, stakeholders and citizens groups to enhance the democratic legitimacy of
decisions.

FORMS OF GOVERNANCE
Governance as Good Governance
The World Bank looks at governance as the exercise of political power to manage a nations affairs and good
governance involves: an efficient public service, an independent judicial system and legal framework to enforce contract;
the accountable administration of public funds; and independent public auditor, responsible to representative legislature;
respect for the law and human rights at all levels of government; a pluralistic institutional structure, and a free press.
The World Bank in order to achieve efficiency in the public services, seeks to encourage competition and
markets; privatize public enterprise: reform the civil service by reducing over-staffing; introduce budgetary discipline;
decentralize administration; and make greater use of non-governmental organizations.
Establishing transparency, responsiveness, accountability, rule of law, equitability and inclusiveness, an effective
grievance redressal mechanism, participation of various stakeholders in decision making process, and a strong
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communication network are sine-qua-non for good governance.

The New Public Management (NPM) Form of Governance
The classic formation of NPM (Hood, 1976)comprises of the superiority of private sector management techniques
as opposed to the bureaucratic focus of the public administrator. It lays emphasis on explicit standards and measures of
performance, output controls, disaggregation and decentralization of public services, promotion of discipline and
parsimony in the allocation of resources and competition in the provision of public services and separation of political
decision-making from the direct management of public services.
NPM is relevant to the discussion of governance because of the distinction between policy decision (steering)
and service delivery (rowing). Rowing refers to government and steering refers to governance.
The weaknesses of NPM include its focus on intra-organizational approach, management by objectives,
performance controls, target fixing and contradiction between competition and steering.
Governance as Corporate Governance
Corporate governance refers to the system by which organizations are directed and controlled. The role of
governance is not concerned with running the business of the company per se, but with giving overall direction to the
enterprise, with overseeing and controlling the executive actions of management and with satisfying legitimate
expectations for accountability and regulation by the interests beyond the corporate boundaries. All companies need
governing as well as managing. All organizations must strive for openness or the disclosure of information; integrity or
straightforward dealing and completeness; and accountability i.e. holding individuals responsible for their actions by a
clear allocation of responsibilities and clearly defined roles(Rhodes, 1997).
The concept of strategic corporate social responsibility is integral to corporate governance. Partnerships with
government and voluntary sector agencies can help business organizations to play a role in provision of public services
and indulge in social marketing of public services especially at the community level. In particular, for-profit sector
agencies can undertake cause related marketing by fostering partnerships with those voluntary organizations which have
clean image and a brand of their own (Taylor, 2010).
Governance as Self-Organizing and Inter-Organizational Networks
Networks are a widespread form of social co-ordination and manage inter-organizational links. The network form
of governance highlights reputation, trust, reciprocity and mutual interdependence. As such, networks may be considered
as an alternative to buy not a hybrid of markets and hierarchies and they span the boundaries of the public, private and
voluntary sectors. This use of governance also suggests that networks are self-organizing and relatively autonomous since
the controlling capacity of government is limited. Lack of legitimacy, complexity of policy processes, complexity and
multitude of institutions concerned etc are some of the challenges posed by the networks. Thus integrated networks resist
government steering, develop their own policies and mould their environments (Rhodes, 1997).
The New Public Governance (NPG)
The NPG is a product of and a response to the increasingly complex, plural and fragmental nature of public policy
implementation and service delivery in the twenty first century. It exhibits both a plural state, where multiple
interdependent actors contribute to the delivery of public services through network coordination, and a pluralist state,
Impact Factor (JCC): 5.4362

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Governance of Government-Third Sector Partnerships for Public Services Delivery

where public policy making involve multiple processes. It is concerned with the institutional and external environmental
pressures that enable and constrain public policy implementation and the delivery of public services within such a plural
and pluralist system. As a consequence of these two forms of plurality, its focus is very much upon inter-organizational
relationship and upon the governance of processes, stressing service effectiveness and outcome that rely upon the
interaction of Public Sector Organizations with their environment. The central resource-allocation mechanism is the interorganizational network, with accountability being something to be negotiated at the inter-organizational and inter-personal
level within these networks(Osborne & Kaposvari, 1997).Such networks are characterized with power inequalities that
must be navigated successfully for their effective working.
Core Elements of NPG

Co-production concept coined by Elinor Ostrom is the mix of activities that both public service agents and
citizens contribute to the provision of public services. The former are involved as professionals, or regular
producers, while citizen production is based on voluntary efforts by individuals and groups to enhance the
quality and/or quantity of the services they use.

Co-Management involves participation of the voluntary sector alongside public and for-profit actors in managing
the growing complexity of delivery of diverse mix of publicly financed services.

Co-Governance involves participation of third sector along-with public and private actors in decision making and
planning of public services.
However, it should be noted that these three concepts are not mutually exclusive. We can expect to find different

patterns of cooperation between the public and third sector, both in different service sectors and indifferent countries. Thus,
there exists both co-production and co-management in preschool services in France and Germany, but only co-production
in Sweden (Brandsen & Pestoff, 2006).
Relational Governance (RG) is an approach that focuses on interactions among the public sector, civil
society, the business sector, concerned citizens, and other actors on issues of societal concern. It emphasizes interorganizational networks, collaboration and a broad range of policy tools. Various elements of RG (Rutzen, 2007)inter-alia
are:

Relational Contracting emphasizes on working towards common goals, promoting communication and
flexibility in problem solving and developing trust on a continuous and long term basis. Also, its focus is not on
narrowly meeting the terms of pre-specified deliverables.

Relationship Marketing (RM) acknowledges that sustainable competitive advantage increasingly requires
collaborative activity rather than rivalrous competition (Sharma & Patterson, 1999). RM has been defined as an
organization engaging in proactively creating, developing, and maintaining committed, inter-active and profitable
exchanges with selected customers over time (Harker, 1999).

Relational Capital (RC) has been defined as the level of mutual trust, respect and friendship that arises out of
close interaction at the individual level between alliance partners. The key insight is to focus upon the import of
individuals and individual relationships and their interaction with the organizational level of relationships. As
partnerships are fraught with hidden agendas driven by the opportunistic desire to access and internalize the

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partners core proprietary skills, the relational capital creates a mutual confidence that no party to an exchange
will exploit others vulnerability even if there is an opportunity to do so. This confidence arises out of the social
controls that relational capital creates (P. Kale & Perlmuttur, 2000).

VOLUNTARY/THIRD SECTOR ORGANIZATIONS

Voluntary/Third sector refers to the diverse mix of associations that occupy the organized part of civil society.
The main characteristics of such organizations are: existence of free association for coming together of members, serving a
public benefit, are self-governing, and do not distribute profits to owners or stakeholders.
The non-distributional constraint relating to the financial surplus of voluntary organizations makes dependence
of government/community on them more logical and trustworthy. However, to keep trust of non-profits among the public,
regulation of non-profits/voluntary sector by the government through appropriate legislation and self-regulation by the
government and voluntary sector is required.
Third sector organizations (TSO) serve the following functions:

TSOs can easily be integrated into partnership arrangements because they are multifunctional organizations being
based on more than single rationale or mode of operation.

TSOs are partners in public policy formulation and implementation at every level of governance. At the local
level of governance, they are primarily involved in the coproduction of services; at the regional and national
levels of governance, they are active in lobbying and advocacy activities.

Governance and, in particular, the notion of good governance are strongly linked to partnerships in the sense of
non-hierarchical coordination, peaceful conflict resolution, and efficient and effective policy-making. In
governance arrangements, TSOs provide avenues for civic participation. Accordingly, they contribute
significantly to the legitimacy of democratic regimes.

PARTNERSHIPS
The (OECD, 1990)has defined partnerships as System of formalized co-operation, grounded in legally binding
arrangements or informal understanding, co-operative working relationships, and mutually adopted plans among a number
of institutions. They involve agreements on policy and program objectives and the sharing of responsibility, resources,
risks and benefits over a specified period of time.
(Miller, 1999)Effective partnerships can be expected to generate; information sharing; improved
communication; a better understanding of what each stakeholder can offer; the avoidance of duplication and inefficiencies;
and the identification of opportunities for effective sharing of resources.
Partnerships also facilitate innovations through coming together of different stakeholders from different policy
perspectives by sharing of ideas, expertise and practice and minimization of risks, pooling of resources and synergy lead to
reduction in operational cost, information sharing, improvement in communication.
The limitations of partnerships include conflict over goals and objectives of the participant organizations and
individuals belonging to them with those of partnership. The fixation of accountability is very difficult as there is no
centralized control or hierarchy. All participants of partnership are equal. The organizational forms of partnerships also
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Governance of Government-Third Sector Partnerships for Public Services Delivery

pose difficulties. Power relations need to be continuously negotiated for rules and processes to be followed. Participation
of community remains minimal. Partnerships are key instrument of local governance.

RATIONALE FOR GOVERNMENT-THIRD SECTOR PARTNERSHIPS FOR PUBLIC SERVICES

DELIVERY
Market/Government/Contract/Voluntary failures pose serious challenges for public policy formulation/
implementation related to public services delivery in a democratic welfare state due to inherent weakness of New Public
Management (NPM) and the changing nature of state from unitary towards plural and pluralist state. Therefore the
rationale for Government-Third Sector Partnerships for public services delivery requires analysis of the following
established facts (Salamon, 1995) for framing a conceptual model as explained thereafter:
Market Failure: Providing collective goods like national defence or clean air, exclusively through the market
will result in their short supply since few consumers will volunteer to pay for products they could enjoy without having to
pay. This phenomenon is referred to as free rider problem. With market demand low, producers will produce less of these
goods or services than the public really needs and wants leading to market failure. Since government can tax people to
produce collective goods it can overcome this market failure
Contract Failure: For some goods and services, such as care for the aged, the purchaser is not the same as the
consumer. In these circumstances, the normal mechanisms of the market, which involve consumer choice on the basis of
adequate information, do not obtain. Consequently, some proxy has to be created to offer the purchaser a degree of
assurance that the goods or services being purchased meet adequate standards of quality and quantity. The non-profit form,
in this theory, provides that proxy. Unlike for-profit businesses, which are motivated by profit and therefore might be
tempted to betray the trust of a purchaser who is not the recipient of what he buys, non-profit firms are in business for more
charitable purposes and may therefore be more worthy of trust.
Government Failure: Government too has certain inherent limitations as a producer of collective goods. In a
democratic society it will produce only that range and quantity of collective goods that can command majority support.
Inevitably, this will leave some unsatisfied demand on the part of segments of the political community that feel a need for a
range of collective goods but cannot convince a majority of the community to go along.
Voluntary Failure: The voluntary failures may be due to the following:

Philanthropic Insufficiency results from inability of the voluntary organization to generate resources on a scale
that is both adequate enough and reliable enough to cope with the human service problems.

Philanthropic Particularism is the tendency of voluntary organizations and their benefactors to focus on particular
subgroups of the population, which is one of the purported strengths of the voluntary sector. But particularism and
the favouritism that inevitably accompanies it leave serious gaps in coverage and also contribute to wasteful
duplication of services.

Philanthropic Paternalism vests most of the influence over the definition of community needs in the hands of
those in command of the greatest resources. Thus the preferences of wealthy members get precedence over the
requirements of the community as a whole. As a consequence, some services favoured by the wealthy, such as the
arts, may be promoted, while others desired by the poor are held back.

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Philanthropic Amateurism is the association of voluntary organizations with amateurs (untrained people) to cope
with human problems.
To fill the gap of unsatisfied demand of public services provision relating to segments of the political community,

some mechanism needs to be devised and government-voluntary/third sector partnerships for public services delivery,
appropriately regulated, qualifies as one possible solution for filling up this gap.
Mechanism of Government-Third Sector Partnerships
Market failure, government failure, contract failure and voluntary failure make it clear that neither market nor the
government can alone provide the public services as desired by all citizens in a democratic welfare state. The provision of
public services in a democratic state is made as per the requirements of the majority population. This leads to a situation
where in demand of some citizens and/or groups of citizens remains unsatisfied. Since neither the government nor the
private sector or the voluntary sector can fulfil such requirements fully on their own, they must enter into partnerships. The
voluntary organizations by virtue of their multifunctional roles viz. of providing public services and strengthening
democracy at the grassroots level, facilitating research work, public policy formulation and implementation, charity work,
advocacy etc. and the trust which the people repose in them due to their non-distribution constraint of profits if any, to their
stakeholders become logical partners with the government for providing public services to the citizens. Thus partnerships
between government, for-profit and voluntary sector appropriately regulated, qualifies as one possible solution for filling
up this gap of unsatisfied demand of public services provision. By resorting to appropriate Risk Management the inherent
risk of failure will be diversified and all actors to the partnerships will ensure as to which of them independently or in
conjunction with the other will deliver public services best to fulfil the requirements of the community.
The study attempts to explore new frontiers of Government Third sector partnerships based on the above
mentioned established facts. Despite the fact that the government still plays important role in public services provision
through its policy formulations and these policies keep on changing from time to time for the suitability and benefits of the
citizen recipients, there remains a gap between the government efforts To Deliver and the beneficiaries To Receive.
This is a common problem in a democratic welfare state considering the different political agendas of political elites and
policy planners. In order to fill this gap of unsatisfied demand there is a need for innovative methods and governance
mechanisms where the responsibility for public services delivery should be decentralized to the related stakeholders who
can then fulfil these requirements with their own capability and functioning by entering into partnerships with
private/voluntary sector organizations.
GLOBAL PERSPECTIVES: A CASE STUDY OF SELECT COUNTRIES
Different countries follow different processes for managing, governing and regulating GovernmentThird Sectors
Partnerships for public services delivery. A study of select developed countries is cited for evaluating a generalized
conceptual model.
United Kingdom: In the UK, partnerships between Government and Third Sector for public service delivery have
been reformed and refined by a combination of hard and soft laws as well as establishment of new forms of regulatory
controls. Statutory definition of charity and a public benefit test for charitable purposes has been given by The Charities
Act, 2006.In addition, the Act covers the assistance and supervision of charities by the court and the Charity Commission
and an independent Charity Tribunal to hear appeals against decisions of the Charity Commission. Legal reform has been
Impact Factor (JCC): 5.4362

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Governance of Government-Third Sector Partnerships for Public Services Delivery

supplemented with new soft law provisions. Soft laws include the establishment of Compact in 1997, self-regulation
through voluntary codes for fundraising and governance of relations between government and voluntary sector.
The compact is a general framework and an enabling mechanism to enhance relationship, rather than a legally
binding document. It is a commitment of intent between the parties concerned but less than a contract. The Compact has
formed the basis for the development of five codes of practice in relation to particular areas, each of which lists the rights
and responsibilities to which both sectors should adhere in order to make the partnership work. Separately, in recognition
of the increasingly important role that the third sector has come to play in both society and economy, the Prime Minister
Office created the office of the Third Sector (OTS) rebranded as the Office for Civil Society in the Cabinet Office to
drive forward the governments role in supporting a thriving third sector and to join up sector-related work across the
government. Self-Regulation through Voluntary Codes has been defined primarily in terms of setting standards for internal
governance, administration, and financial management systems so as to ensure compliance with reporting requirements,
laws, and regulations. Examples include development of a Code of Governance by and for the voluntary sector and a selfregulatory scheme for fundraising by the voluntary sector that has its origins in the statute.
United States: In the US, partnerships between Government and Third Sector for public service delivery have
been impacted by the New Public Management and third party government. It has led to greater interest in
accountability and control of non-profits by the government, while at the same time it has increased incentive for
collaboration between government and non-profits as well as among non-profit organizations giving rise to hybrid forms of
organization financing and relationships.
The diversification of policy tools involve greater utilization of tax-exempt bonds by government and non-profit
organizations especially, smaller community based organizations. Another change has been the shifting from the traditional
contracts which were based on a cost-reimbursement basis that paid agencies for their costs based upon the contract terms
and available budget towards performance based contracts whereupon agencies are reimbursed for services only if they
meet specific performance targets thus increasing the pressure to improve their performance. Further, performance
contracting also tends to promote market competition among providers: Government is supposed to hold agencies
accountable for specific outcomes, and if they do not meet these outcomes, government has the option to turn to a different
service provider. Also, the advent of performance contracting and the increased attention to program evaluation and
outcomes has encouraged the government and non-profit agencies to explore ways to achieve accountability through
accreditation and self-regulation.
In order to have long term relationships between the two sectors the government has entered into Relational
Contracting with certain non-profit organizations. Relational Contracting emphasizes on working towards common goals,
promoting communication and flexibility in problem solving and developing trust. Its focus is not only on narrowly
meeting the terms of pre-specified deliverables. This relational contracting does not preclude differences of opinion or
outright conflict, but it does underscore the stability of many contracting arrangements and the importance of cooperation
among the two parties. But this cooperation occurs within a framework established by the more powerful partner which is
obviously the government. For example, non-profit organizations may cooperate with government on a contract for
community care for the chronic mentally ill, but the standards of care, financial regulations, and outcome measures are still
set largely by the government.
Non-profit federalism offers an opportunity to combine the service-delivery advantage of voluntary organizations
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Sanjeev Kumar Singhal & Prabhakar Jha

with the revenue-generating and democratic priority-setting advantages of government (Salamon 1995). In many cases
this mechanism makes it possible to match publicly generated funds with privately generated ones to provide a better
service than either side could provide on its own.
Germany: In the German welfare state the interface between non-profit organizations and their environment has
adopted a corporatist institutional character wherein partnerships are governed by formalized inter-sectoral and
intermediary collaborations. Germany has a longstanding corporatist tradition that has included a cooperative relationship
between German governments, at the national and state levels, and third sector. Many third sector organizations are very
large and receive most of their funding from the government.
Government-third sector partnerships are entered through umbrella organizations representing voluntary/third
organizations and are scaled to state/national levels. More recently, the tenets of NPM have pronounced shift towards more
market oriented mechanisms including formal contacting, competitive bidding and greater regulation. The understanding
of the partnerships between the government and the third sector include: First, the growing marketization of welfare
services and hybridization of the corporatist legacy. Second, the regulation of charities and non-profits is closely related to
the nature of the welfare state because much of the regulation that really matters occurs in the specific context of the
welfare markets in which non-profits work. Third, need to pay attention to scale and examine sub-traditions, given growing
differentiation, by geography and by specific welfare services, within Germany.
Canada: The Canadian model of the welfare state has been a developed mixed economy in which services are
delivered by governments, non-profits, and for-profit firms in varying mixes depending on the particular service. The New
Public Management (NPM) reinforced this mixed economy by shifting a greater range of services from governments to
non-profit delivery and by promoting more open competition between non-profit and for-profit providers. In 2009, a new
policy on charitable fundraising was introduced by the federal government which comprised of ethical fundraising
practices through active self-regulation and Financial Management Code is testing plans for a more formal certification
system of good governance.
In Canada, the governance of partnerships are regulatory in nature which is exercised through both rules on
charities and contracting regimes and there is little movement towards institutionalized collaboration. The regulatory
change has been incremental, layered in as new administrative practices and clarified interpretations of existing law. The
national government has thought of the third sector primarily as alternative service delivery, rather than being a force for
democracy, citizen engagement, or community and economic development. As such, the role of third sector needs vision
and clarity at the political level. In a nutshell the UK model in its diluted version is being followed in Canada.

Impact Factor (JCC): 5.4362

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Governance of Government-Third Sector Partnerships for Public Services Delivery

11

A CONCEPTUAL MODEL
Flow Diagram based on the above case studies:

Figure 1
The above model illustrates that the transition from traditional mode of governance of public services delivery
towards governance of government third sector partnerships for public services delivery in a democratic welfare state
entails introduction of new elements as well as overlapping of some elements of traditional mode of governance, in
partnership mode of governance.

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CONCLUSIONS AND SUGGESTIONS

The aforementioned study requires the consideration of following suggestions for implementation in order to
make governance of government third sector partnerships for public services delivery effective.
In the UK, the governance of government third sector partnerships for public services delivery has attempted to
strike a right balance between hard and soft laws. The Charities Act, 2006 of England has given statutory definition of
charity and a public benefit test for charitable purposes. Legal reforms have been supplemented with new soft law
provisions through the establishment of the Compact which moves towards self-regulation for governing partnerships.
The compact is a general framework and an enabling mechanism to enhance relationship, rather than a legally binding
document. This arrangement can be suitably adopted in a democratic welfare country like India. India has already initiated
the partnership culture through support of various NGOS and self-help groups for the social welfare and financial
inclusion. There is a strong need for enacting a law on the lines of the Charities Act, 2006 of England and putting in place a
regulatory framework on the lines with the Compact of UK which will enhance partnership of voluntary sector with
government and other sectors for public services delivery and engaging the diverse interests for a common cause.
As in the US, the traditional contracts have shifted towards performance based contracts whereupon agencies are
reimbursed for services only if they meet specific performance targets thus increasing the pressure to improve their
performance and to promote market competition among service providers. In order to have long term relationships between
the two sectors the government has entered into relational contracting with certain non-profit organizations. Relational
Contracting emphasizes on working towards common goals, promoting communication and flexibility in problem solving
and developing trust; its focus is not on narrowly meeting the terms of pre-specified deliverables. This relational
contracting does not preclude differences of opinion or outright conflict, but it does underscore the stability of many
contracting arrangements and the importance of cooperation among the two parties. Also, this cooperation occurs within a
framework established by the more powerful partner which is obviously the government. For example, non-profit
organizations may cooperate with the government on a contract for community care for the chronic mentally ill, but the
standards of care, financial regulations, and outcome measures are still set largely by the government.
Following the footsteps of the US framework, the modus operandi of decentralizing the power could be replicated
in the Indian context considering the demography of the country which warrants taking into account the limiting factors
such as regional imbalances, socio-economic and cultural differences. The other mechanisms prevailing in the US relating
to partnerships involving the third sector like performance based contracting, hybrid organizational forms and relational
contracting could be segregated to meet the basis for the governance of government-third sector partnerships for public
services delivery. The voluntary participation of citizens through their gifts, charity, philanthropy, manpower etc. for
helping their fellow citizens to access public services needs to be given formal, legal and regulatory form.
In the German welfare state the interface between non-profit organizations and their environment has adopted a
corporatist institutional character wherein partnerships are governed by formalized inter-sectoral and intermediary
collaborations. The German model can be replicated in the Indian context considering the mandatory requirement of
corporate social responsibility for providing services to eligible beneficiaries/recipients.
Canada is following the UK model albeit, in a diluted form and proceeding incrementally through various
clarifications and interpretations of the existing legal and regulatory framework. This could be a motivational ground for

Impact Factor (JCC): 5.4362

NAAS Rating: 3.07

Governance of Government-Third Sector Partnerships for Public Services Delivery

13

initiating such form of governance in India as a beginning.

In India the voluntary sector and its partnerships with the government is governed by National Policy on
Voluntary Sector, of the Planning Commission, Government of India, conceptualized in the year 2007 wherein it is stated
that this policy is the beginning of a process to evolve a new working relationship between the government and the
voluntary sector without affecting the autonomy and identity of voluntary organizations. There are large numbers of
voluntary organizations operating in India but majority of them are operating in isolation. As such, there is a strong need to
convert such voluntary organizations into voluntary sectors representing education, health, social services separately in
order to meet the deficiencies in education, health, basic needs and social services etc. in India. These voluntary sectors
could then be converted into Cluster Organizations for India instead of Umbrella Organizations in Germany and the UK
along with the provisions of legal and regulatory framework for their entering into partnerships with government and other
agencies for public services delivery.
Based on the above studies the various important constructs have been formulated with common factors as
important variables of governance shown in a conceptual model which could be empirically tested based on the primary
data for further research.

SCOPE FOR FURTHER RESEARCH

To explore the nature of Regulatory Framework for governing Government-third sector partnerships for public
services delivery.

To explore the missing link(s) relating to trust/values of government in the third sector for public services delivery
and its functioning.

To explore the erosion of trust in the third sector among individuals/volunteers/donors.

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www.tjprc.org

editor@tjprc.org

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Sanjeev Kumar Singhal & Prabhakar Jha

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Impact Factor (JCC): 5.4362

NAAS Rating: 3.07