Chinese and Australian Neoliberal Policy Responses to Risks in Social Service Purchasing

Abstract

China adopted neoliberal approaches to improve the supply of quality social services in the early 2000s. How did the Chinese government manage the financial and quality risks of increasing the provision via government purchasing and how did it differ from other countries? The article examines the policy trajectory of early childhood education and care in China and Australia on this question. Policy analysis of the effect of purchasing on the cost to government and quality of services shows how both countries used subsidy arrangements to engage non-profit and private providers to expand supply. When faced with market risks, they both tightened regulations, but China differed in the speed and strength of their response, restricting the proportion of private providers. The findings have implications for understanding the risks of relying on market forces in other social service sectors, and how policy can effectively respond.