Non-financial Competition Mechanisms are Prevailing in the Social Sphere

12 october 2017

At the federal level, there's a current focus on increasing the presence of non-governmental participants in the social services market. Public authorities of the Subjects of the Russian Federation have the basic possibilities and powers to ensure that the organizations of all ownership forms are provided with a competitive admission to the rendering of social services. The new Competition Development Bulletin reviews regional experiences of competition mechanisms implementation in the social service markets.

Measures that are included in regional road maps and allow non-governmental organizations to provide social services can be divided into two types: financial and non-financial. The Bulletin analyzes specific characteristics of these measures' implementation mechanisms in five social markets: preschool education services; children's recreation and rehabilitation; additional education for children; cultural and social services for the population.

Through this analysis, experts came to the conclusion that non-financial competition mechanisms in the social sphere prevail in all the above-mentioned markets. At the same time, subsidies for public institutions and private organizations are granted from the regional and municipal budgets on differential terms. Even with funding contests, regions prefer not to create conditions for competition among social organizations of different ownership forms, but organize separate competitive selections for private companies, experts point out.

In the sphere of preschool education, financial mechanisms for the admission of non-governmental organizations to competitive service rendering are implemented within the provision of subsidies to preschool educational institutions, partial compensation for the sums that parents pay for taking care of their children, and the provision of funding following the contest results.

In the sphere of children's recreation and rehabilitation, financial mechanisms for the admission of non-governmental organizations to competitive service rendering are implemented through the procurement of services within the contests that are organized in accordance with the Law #44-FZ, the provision of subsidies to legal entities and individual entrepreneurs, compensation for the part of package costs, and the provision of funding following the contest results.

In the sphere of additional education for children, financial mechanisms for the admission of non-governmental organizations to competitive service rendering are implemented within the provision of funding following the contest results and personified funding of additional education for children (demand-side subsidies).

In the sphere of cultural services, financial mechanisms for the admission of non-governmental organizations to competitive service rendering are implemented within the provision of funding to non-governmental organizations and their involvement in cultural and leisure activities.

In the sphere of social services, financial mechanisms for the admission of non-governmental organizations to competitive service rendering are implemented within the provision of subsidies to the suppliers of social services that are included in a respective register and are not involved in any state order implementation or the procurement of social services within the contest.

Please find more details in the Bulletin Competition Mechanisms in the Social Sphere: Budgetary Funding of Private Providers of Social Services in the Regions.

For other competition development bulletins see the Publications section.