Does 'competition' kill 'social capital'?

In the emerging environment created by National Competition Policy, and with significant devolution of human service provision, 'social capital' has come to be seen as an element of value in the non-government sector. However, concerns have also been raised about the impact of competitive tendering and purchase of service contracts on the ability of community organisations to participate in policy debates or advocate on behalf of client groups and to engage in broader community development, and on the likelihood of local grassroots participation in management. Through interviews with co-ordinators and management committee members in NSW, the present research identified seven specific areas of concern for local, community-based community-service organisations, and also strategies being developed to address them. Three broad types of strategies for building social capital under competition policy emerged: (i) Trying to work within constraints - an attitude of 'business as usual' but often resulting in a reduction in community development activities; (ii) Unforced partnerships - formation by community organisations of their own alliances; and (iii) Forging of a stronger community-sector identity - establishing distinguishing features that identify community organisations as parts of a recognisable whole.