Covid19 or not — the missing link in public policy response is to account for heterogeneity, resistance and care
This is a covid19 impact story posted by Hannah. She is the co-founder of a Vienna-based social business (i.e., economic and social interests are both underlying cornerstones to the business activity) called Vollpension (‘Pension’ stands for both ‘guest house’ and ‘retirement’ in Austrian German). Vollpension’s café-bakery business is — together with many of its counterparts in Vienna or worldwide — severely touched by exit bans, lockdowns and the consequences thereof.
Yet Vollpension is also a story we can learn from in a very intuitive manner about what is missing in public policy response where it actually is most needed to fully function — with our without the presence of covid19:
Policy needs to focus more on what is reality
Vollpension enables pensioners or pension-ripe-but-not-ready gentlemen and ladies to either become again or to continue being an active part of society. HOW? By providing them with a chance to engage (again) in paid work and — connected to the former — social life, that they are otherwise inhibited to participate in. WHY? Given prevailing legislative or regulatory constraints, (e.g., losing pension allowance when engaging in work, relatively early retirement when compared to life expectancy, etc.) that are unfit to match what an ever-increasing portion of the elderly actually need nowadays.
Vollpension faces and acts against this brutal reality: Poverty in old age, especially amongst females, is high even in Austria, one of the declared ‘richest’ countries in the world, and its capital town Vienna, where both the Vollpension and Hannah are based. For example, most of the already retired elderly working at Vollpension (the retired elderly account for approx. 50% of their total workforce) do not touch a high enough pension to cover their basic living expenses, yet at the same time, without Vollpension and their mediating business model vis-à-vis policy institutions and the law, the retired employees would lose their pension rights altogether if they engaged in work.
Vollpension hints at what public policy should enable to do at scale:
Face the fact that neither society nor policy can be considered a zero-sum game and make space for such rationale in their policy model.
Policy responses need to account widely for the heterogeneity that is present in today’s society. Instead of homogeneously dictating that, e.g., all elderly need to retire they should allow at scale that those elderly who show a real desire and are fit to engage in professional life are enabled and not prevented or punished to do so. Society will not lose out as a whole if this desire for the few can be realized — on the contrary, if we carefully consider what variable we consider as heterogeneous or homogeneous respectively. We have already witnessed, and will do so further, similar policy approaches in the covid19 responses, heterogeneous depending on, e.g., location, age groups, industry, etc., yet homogeneously applied throughout the territory.
Policy needs to learn to appreciate resistance
Ironically, given the emergency covid19 policy measures, the Vollpension is now becoming a victim of its own success:
While its business model idea is centered around bridging the gap between an outdated public policy situation and today’s societal reality and needs, it is now, under covid19, deeply affected itself by its new social reality and needs and outdated public policy measures taken as a response to it.
So-called “Überbrückungskredite”, reconciliation loans foreseen as one of the government’s crisis mechanisms to allow for liquidity during the intense covid19 period, are practically — not on paper — inaccessible to Vollpension’s Hannah and her two co-founding colleagues: “100% sounds great in the press conference and will be understood by most of the public as that all of the companies are receiving money yet — we are far from that, only who fulfills [certain legal] criteria receives the urgently required resources. […]”, Hannah writes in her story and calls what policy focuses on “the survival of the fittest”.
Given Vollpension is managed as a social business (remember the simultaneous economic and social focus) it might show different numbers or operations in their financial or business statements in relation to a conventional business approach. Those differences disqualify the three co-founders in the criteria to access the much-needed liquidity. At the same time the three entrepreneurs know they not just need yet want to pay the salary to the 100 reliable employees, recognizing them as the heart of their company’s business model. The three might end up, very likely, in a sort of personal financial distress given they seem to be required to secure that money personally, pending the clarification of procedures and rules by the government.
“Do you know what paying roughly 110,000 euros, the sum for two months salary, means to a small SME without turnover? AN INCREDIBLE LOT!” Hannah emphasizes.
Uncertainty and guaranteeing personally with your existence is a risk you are willing to take as an entrepreneur, also as a so-called young or social entrepreneur. It is what makes the essence of an entrepreneur. Yet disproportionately protracting such willingness to shoulder risks into times of unprecedented economic (and social) hardship is an inexcusable faux-pas in a policy response, emergency or not.
Policymakers can, instead, just try to listen more systemically to outcries like Hannah’s; and generally those stemming from the traditionally overlooked domains in an economic landscape like, e.g., social businesses versus the well-established incumbents, the ones close to the government’s inner circles, or “the fittest”. Responses and reactions to public policy are amongst the most valuable feedback politicians and administration can obtain to align, adapt and correct measures that are taken. The more institutionalized ways to capture such feedback are known as policy design, policy prototyping or regulatory sandboxes and have become increasingly popular in government — crisis or not — and hopefully not just on paper.
Public policy needs to care more — not to crowd-out
The Vollpension lives and survives due to what it has been animated by since its inception: A relentless drive to do better as and for society. Amongst those who founded it, those who work for it, those who visit it or call it their favorite café.
Also in times of covid19, Hannah and the Vollpension’s ecosystem maintain that drive. She states they now reflect on “how they can maintain liquidity, independently from the banks or the government”. Under the slogan ‘Grandmother needs you now’ (see picture) the Vollpension currently calls for crowdfunding on a platform that is dedicated not just to the Vollpension yet all especially young startup and SME business activities in Austria, to secure their operations and liquidity during covid19.
Apart from Vollpension, we witness many such activities as an answer to covid19, particularly hackathons or remote design sprints on various topics (education, health sector, elderly care, etc.) that are organized by various institutions, with or without direct or indirect government support. The OECD has issued a call for innovative government responses to covid19. And we also need to recognize those governments’ and leaders’ activities put in place to manage the crisis and empathize with society. It is undoubtedly a challenging situation also for those who make final calls in the name of the public and public wellbeing.
Still, government and public policy cannot just expect civil society to come up with innovative solutions when an insufficient policy response requires it.
What we live now makes explicit what have been inherent and subjacent problematics in public policy for a long time.
Management by efficiency standards (e.g., treating public like business affairs), lack of appreciation (e.g., downsizing the healthcare apparatus), lack of prioritization (e.g., the role of farmers or regional production in agriculture) to name but a few out of many longstanding deficiencies we all are well aware of, and measures that have not leveraged the full potential of what is actually possible for and in the public sector.
We need a public policymaking that cares way more to change from within while continuing to enable change outside of its walls.
Policy needs to make sure not to go against those who carry its society. It needs a public policy that is inclusive, resilient, and open-hearted.
When I work with governments or public policy institutions to instill change they often tell me that they “don’t know how to”. Well, the how can be straightforward, just like Vollpension’s response to care for those who are left uncared by an existing system: Look at the stories that are lived by the people under your jurisdiction or on your territory. Use them as an additional form of evidence. Do not discharge them by not taking them seriously, their statements as an offense, their opinions as nonsense.
People like Hannah or the Vollpension employees are the experts of their lives. Even more so when policy lets them down, willfully or not. Under crisis or not.
