National Compacts are the most formal evidence of the continuing expansion of structures to strengthen deliberate relations between governments and the third sector around the world.1 These include new government units that focus on third sector relations, new trade associations that seek to mediate relations with government, and new liaison structures that focus on collaboration between the sectors.

Australia has joined an ever-growing number of countries and states that have developed similar cross-sector compacts – some of which have been deemed successful in strengthening relations between the sectors, while others have had little impact.

Australia’s Compact

On 17 March 2010, then-Prime Minister of Australia Kevin Rudd launched the Australian Compact, a new framework agreement between the Federal Government and the third sector. According to Rudd, the Compact ushered in “an era of collaboration … that will fundamentally strengthen and improve the way [they] work together.”

Now, in the new Gillard Government, the Social Inclusion portfolio has been given to the Hon. Tanya Plibersek. Fulfilling a Labor election promise, Plibersek has established a new Office for the Not-for-Profit Sector and an external advisory Not-for-Profit Sector Reform Council to support the implementation of the Compact.

United States: Compact-free

There is no Compact in the United States (US), even though there is broad recognition that the growing salience of the third sector in the last decades has outstripped the capacity of existing structures to manage the interactions between the sectors. The relationship between governments and not-for-profits (NFPs) in the US has been characterised as being poor, ambiguous, and in need of new paradigms of interaction2 but this has not resulted in sector-to-sector framework agreements.

While the US may be ‘Compact-free’, other initiatives are appearing that seek to achieve similar outcomes.

A de-facto Compact

In April 2009, the Mayor of New York City, Michael Bloomberg, launched the Mayor’s Nonprofit Initiative, a suite of new projects that seek to strengthen the relationship between the city administration and NFPs. The projects include a new online portal for NFPs seeking to work with the City, a Chief Services Officer to promote community service, and a Nonprofit Contract Facilitator in the Mayor’s Office of Contracts Service. These are co-ordinated through cross-sector working groups convened by the Office of the Deputy Mayor for Health and Human Services.

At the launch of the Initiative, the Mayor stated that “the nonprofit sector is a vital part of the City and our economy [and …] it’s critical that the City take concrete steps to strengthen the sector and help it thrive.”

The density of the new deliberate relations created by these initiatives is transforming the relationship between city government and NFPs, and in effect could be seen as a ‘de facto’ compact.

A new hope

In June 2010 the federal Nonprofit Sector and Community Solutions Act (H.R. 5533) was introduced into the US Congress. According to its principal sponsor, Representative Betty McCollum (D-MN), the aim was “to improve the relationship between the Federal Government and nonprofits…by making the Federal Government a more productive partner with nonprofit organisations”.3

Among other measures, the Act would establish a cross-sector Council on Nonprofit Organisations and Community Solutions that would bring together representatives from government, NFPs and business, and a Federal Government Interagency Working Group on Nonprofit Organisations that would evaluate recommendations from the new Council and co-ordinate policymaking relating to NFPs.

At the time of writing of this article in late 2010, the Act is still pending. It has garnered broad support in government and NFP circles, including the full backing of large nonprofit umbrella organisations such as The Independent Sector and the National Council on Nonprofits. At the same time, there has been some pushback, with the usual warnings about the perils of proximity to government. While some commentators see little hope of the Act passing with the new Republican majority, others believe bi-partisan support for NFPs may just push it through.

Momentum is growing

Whatever the future holds for any individual initiative in Australia and the US, momentum is growing in both countries for new policy agendas that swing the pendulum towards collaborative paradigms and cross-sector partnerships.

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1. Carter, S. and Speevak Sladowski, P. (2008). Deliberate Relationships between Government and the Nonprofit/Voluntary Sector: An unfolding picture. Ottawa: Wellesley Institute and the Centre for Voluntary Sector Research and Development.

2. Grønbjerg, K. A., & Salamon, L. M. (2004). Devolution, Marketization, and the Changing Shape of Government-Nonprofit Relations. Washington DC: Aspen Institute; Young, D. (2006). Complementary, Supplementary, or Adversarial? In E. T. Boris, & C. E. Steuerle (Eds.), Nonprofits and Government (2nd ed.,). Washington: Urban Institute Press.

3. McCollum, R. B. (2010). Giving the US Nonprofit Sector a Seat at the Federal Table. http://thehill.com/blogs/congress-blog/campaign/109795-giving-the-us-nonprofit-sector-a-seat-at-the-federal-table-rep-betty-mccollum