The aggregation advantage
Aggregation gives government and philanthropy one centralised partner, more WISEs a pathway to participate, and a practical way to test, learn and scale what works.
One contract. Many social enterprises. More impact.
Australia has thousands of jobs-focused social enterprises with the expertise and community connections to deliver.
But for many, accessing government programs is complex. Government contracting comes with necessary requirements around governance, reporting, financial management and risk. For smaller or specialised organisations, these can be difficult to navigate. At the same time, managing large numbers of individual contracts creates complexity for government.
Aggregation provides another way.
What is an aggregator?
An aggregator acts as a bridge between government, philanthropy and a group of delivery organisations.
Instead of government establishing and managing 25-200 individual contracts, it might establish two or three larger agreements with trusted aggregators.
The aggregator then selects, contracts, supports and manages a group of organisations against a common set of outcomes.
- For government, this creates a single point of accountability.
- For social enterprises, it creates a more accessible pathway into opportunities that may otherwise be out of reach.
The aggregator manages the contract, reporting, data, quality assurance and overall performance.
Participating social enterprises can focus more of their energy on what they do best: supporting people, creating jobs and delivering outcomes in their communities.
Our experience
Whitebox has been pioneering and testing the role of aggregation since 2022, when we began delivering Australia’s first federal Payment by Outcomes trial for jobs-focused social enterprises in partnership with the federal Department of Social Services.
Through that trial, we held the principal agreement with government and worked with social enterprises across Australia to create and sustain employment for people facing complex barriers to work.
The model enabled participating organisations to be paid for verified employment outcomes while also building a shared body of evidence about what works, for whom, at what cost and under what conditions.
We’re now applying and refining this approach through further initiatives with the federal government, including the Workfoundations program.
Why aggregation works for government
Aggregation allows government to engage a diverse market without creating an unmanageable contracting burden.
A well-designed aggregator can:
- Provide government with one accountable contracting partner
- Undertake due diligence and assess organisational readiness
- establish consistent agreements, outcome measures and reporting requirements
- bring new providers into a program without creating an entirely new government contract
- pause or adjust delivery arrangements when circumstances change
support organisations to improve their capability and performance - manage delivery and financial risk across a group of providers
- identify problems early and respond before outcomes are affected
- collect consistent data across different organisations, regions and cohorts
- commission independent evaluation and make findings publicly available
Government must rightly be careful with public money. Intermediaries such as Whitebox can complement that responsibility with practical, adaptive risk management and closer engagement with delivery organisations.
This is not about government accepting more risk. It is about managing risk differently and more effectively.
What is in it for social enterprises?
We understand that some social enterprises would prefer to work directly with government. Where that is practical, they should be able to.
Aggregation is not intended to replace direct relationships or prevent established organisations from holding government contracts. It creates an additional pathway, particularly for organisations that are smaller, newer, locally focused or not yet equipped to manage a major government contract independently.
A good aggregation model gives social enterprises:
- a clearer and more accessible entry point
- transparent eligibility and selection criteria
- simpler contracting and reporting arrangements
- help interpreting government requirements
- practical capacity building and organisational support
- access to shared tools, systems and expertise
- opportunities to learn alongside other social enterprises
- a stronger collective voice with government
- evidence they can use to demonstrate and improve their impact
- a pathway towards larger opportunities and, where appropriate, direct government contracting in the future
Rather than every social enterprise having to independently navigate a complex government procurement process, an aggregator can create a more open intake process. Organisations that meet the agreed criteria can participate as places become available, with a clear waiting list where programs reach capacity.
The intermediary should not stand between social enterprises and government. It should help bring them closer together.
More than contract management
The value of aggregation goes beyond reducing 25 contracts to two or three. It creates a learning system around delivery.
When social enterprises work toward shared outcomes and collect consistent data, we can compare approaches, understand what works and at what cost, and improve the model over time.
For government and funders, this creates stronger evidence for future policy and investment, including:
- better, more consistent data
- stronger outcome measurement
- faster learning across the sector
- evidence across different communities and regions
- better-informed policy and program design
- a pathway to scale what works
A diverse market of aggregators
We believe there is room (and a need) for multiple aggregators. Australia could benefit from this – with different aggregators bringing different areas of expertise. Some might specialise in homelessness, young people, disability, regional communities, First Nations employment or particular industries.
A diverse market of aggregators would give government access to specialised knowledge while giving social enterprises a choice of partners and pathways.
It would also help ensure that aggregation strengthens diversity and innovation rather than concentrating control.
Building the next generation of government partnerships
Aggregation is still an emerging model. It needs to be tested carefully, independently evaluated and designed in partnership with government, social enterprises and the people these programs exist to support. But the early opportunity is significant.
Aggregation can help government work with a broader and more diverse market. It can help social enterprises access opportunities previously beyond their reach. Most importantly, it can direct more attention and resources towards achieving outcomes rather than administering contracts.
We’re currently testing aggregation approaches with the federal government and are keen to explore where this model could create value next.
If you are a government agency or philanthropic funder interested in developing an aggregation trial, commissioning new evidence or creating a more accessible pathway for social enterprises, we would love to hear from you.
Advocating Through Action
We advocate for change by doing. We build the evidence through testing and trialling with the sector. Then we share what we learn with government, philanthropy and other key influencers.
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