Building social capital requires trust and participation among individuals

Recognising the importance of the non-government sector and the positive values arising from it, what are the lessons for policy?

The first thing is the very important maxim for government, any government, on any issue: "Do no harm."

These social networks are neither established by nor controlled by government. They are voluntary. That is their strength. So while the government cannot establish these associations and should not force engagement it should be careful to do no harm. Second, if government has a choice between delivering services in a way that enhances engagement and one that does not, then, all other things being equal it should prefer the former. Third, government should be alert to deal with any threats that arise to the voluntary sector.

It is the activity, as well as the result, that brings the value.

This is the benefit of mutual obligation. Take a work-for-the-dole project. In return for income support a person engages in a work project. The project produces, hopefully, some valuable infrastructure. But the person who has engaged in the activity has more than just income support. They have the experience of meaningful work, social contact, and hopefully have developed their work skills.

This is why reliance on welfare can damage communities: A person who receives income support without engaging in the social activity of work misses all the side benefits of that activity, and the positive benefits of self-reliance. This is why we should be heightening mutual obligation for people of working age.

On the principle of do no harm, a government should be careful not to usurp the voluntary sector. It should not take away those things which people can and want to do for themselves. But where it can support the voluntary sector, without smothering it, it should do so.

And it must be alert to threats to the voluntary sector. One such threat is the public liability crisis.

We would all agree that an innocent person injured through no fault of their own is entitled to compensation. But if the cost of insuring against the compensation threatens the viability of the local sporting club or the pony club or the scouts then it will threaten an important dimension of our society. It will undermine social capital. This is why it is necessary to limit pay-outs and heighten the protection against liability for the voluntary sector. It is defending a very important part of our social infrastructure.

In the 2001 Bolte lecture I suggested that we could revive the non-government organisations of Australia by spending one hour a week in a volunteer activity.

Some people were critical of the suggestion. I did not stipulate that it should be charity work, although that is a particularly important area of voluntary activity.

I suggested one hour a week at the Rotary, the Lions group, the Church, the Synagogue, the sporting club, the neighbourhood watch, the school or the RSL, the Scouts, the book group, the political meeting or at a neighbour's house.

The idea was just to heighten engagement. It was not being critical of anybody. Some people suggested this was a deep plot to withdraw government funds from the voluntary sector by increasing unpaid participation. Some people were of the view that if there is a problem the government should fix it. But if we expect government to solve all our problems even in this voluntary sphere of life we are a long way from the solution.

The view I am putting is that there are non-monetary things that add to the wealth of a society. Civic engagement and the values which it promotes like trust and tolerance are some of those things. You can call them social capital if that is conceptually easier. It might help with the idea of building them up, running them down, adding to our wealth, or detracting from it. But a society which has these things should be careful not to let them run down. Once they are gone it takes a lot of effort to get them back again.