Neoliberalism and the Nordic Welfare State, or, Why is the Voluntary Sector so Marginalised?

When neoliberalism and New Public Management (NPM) invaded the public sector a new room for non-public service production within the welfare field opened up. In this chapter, mainly analysing Norway, we argue that the reason why the voluntary sector was not able to fill this new space of non-public service production has as much to do with the structure and ideology of the Welfare State and the voluntary sector institutions strongly supporting that ideology, as with the character of the new contract-culture being an integrated part of NPM. It is a fact that voluntary sector based institutions have problems competing on prize with the increasing market sector in the field, partly due to “old” and costly pension obligations. In addition the whole new economically based cost – benefit/efficiency language is challenging to these institutions. In this chapter we will argue that even if both competing on prize and the ideological core of the new contract-culture is important factors in explaining the week position of the voluntary sector, an important reason for its weak position is that the voluntary sector based service producing institutions was marginalized ideologically and institutionally already before neoliberalism and NPM. Such institutions played a very important role in the development of the welfare state and particularly within the welfare field. Their general understanding was that welfare was a public responsibility and these institutions were historically an important force in putting pressure on the state to increase its responsibility. In the heyday of the welfare state these voluntary sector institutions were in strong support of the welfare state ideology sometimes even ending up giving over their institutions to the state or municipalities. This gradually weakened their ideological position in combination with less institutional or service producing strength. The growth in the voluntary sector was now – and still is - not within such service producing institutions, but in more small-scale voluntary organizations and in volunteering more in general. It is exactly this ideological and structural position of the voluntary sector that is a main reason why in the time of neoliberalism and NPM opening up for non-public service production, that what we see is a marginalized role of the sector’s service producing institutions. In supporting the “old” core of the welfare state itself and believing that that was a system “forever”, the sector was not really on the playing field when the public sector itself started to change and the new space for non-public welfare production became a reality. This structural position has profound implication for the role of civil society and the future development of the welfare state in the Nordic countries.