The emerging field of social procurement in China: issues and controversies

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The emerging field of social procurement in China: issues and controversies

Professor Zhang Yuanfeng, Zhongnan University of Economics and Law (Visiting Professor, School for Business and Society)

Professor Ian Kirkpatrick, School for Business and Society, University of York

Over the past decade the People’s Republic of China has undergone an associational revolution, fuelled by the rise of the non-profit (or social enterprise) sector and the political ambition to foster ‘big society’. City governments through the adoption of ‘social procurement policies have actively supported this transition, which aim to stimulate innovation and community organisation in areas where governments lack knowledge or capacity. For some this signifies a move towards the ‘new public governance’ (NPG) in China, expanding the role and importance of the third sector in similar ways to other developed capitalist economies. However, for others this assumption of convergence is highly problematic. It is argued that Chinese civil society remains too under developed to support a NPG model and that China has instead followed its own distinct pathway of reform characterised by ‘administrative absorption of society’ (Kang and Han, 2007). In relation to social procurement, Teets (2012) has described this as ‘consultative authoritarianism’, which essentially allows governments to expand the role of non-profit organisations (NPOs) cautiously, while retaining indirect control. Under this arrangement, NPOs are expected to become ‘quasi-governmental organisations’ with limited autonomy and may experience mission drift. However, is this assessment fair and correct?

We explore this question, focusing on the roll out of ‘Purchase of Service Contracting’ (a form of social procurement) in one large Chinese city: Wuhan. Drawing on 33 semi structured interviews on both the buyer and supplier side and other documentary sources, our analysis leads to some mixed findings. On the one hand, the Wuhan experience highlights key elements of ‘consultative authoritarianism’, notably concerns about delegation and the subtle use of Guanxi networks to direct contracts to favoured providers. Nevertheless, our analysis also reveals some important constraints on the ability of state officials to act as a ‘smart buyers’, resulting in co-production of service contracts and the abdication (by government) of key responsibilities. Based on these findings we argue for a more nuanced interpretation of current policy shifts, which acknowledge the limitations of government and the realities of de facto or informal delegation to NPOs. While the use of social procurement to expand the role of social organisations and civil society more generally in China may not be transformational, it is arguably pushing the state’s ‘zone of indifference’ beyond what many assume to be possible.

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