Understanding Service Contracting and Its Impact on NGO Development in China

Abstract

Abstract The Chinese government and human service NPOs are joining the bandwagon of service contracting with enthusiasm. Although this new policy endeavor has attracted much interest, empirical studies are scant. Drawing from interviews with 14 nonprofit organizations and two government officials conducted in 2012 and 2014, along with abundant secondary data, this paper analyzes the impact of China’s service contracting on the following: the social service delivery system, the promotion of NGOs development, and the nature of government-nonprofit relationship. The study found that service contracting has positive impacts on NGOs, such as facilitating their fundraising through sharing the government’s legitimacy. However, the majority of contract funding went to organizations that have a close government connection. We argue that the future of China’s service contracting is determined by the Chinese government’s primary political agenda, which is social control.