Friday 2 November 2012

Business-Based Model for a Rehabilitation Centre

The following are some thoughts about how a Rehabilitation centre may be able to operate without government funding or donations and without any of the residents receiving social security payments. It could operate entirely on a Biblical, moral, capitalistic model (rather than funded by a socialist, redistributionist model).

This is important because it engenders a work-ethic; and also because in many countries it won't be possible to operate rehab. centres on a welfare-based model.

Let's look at the welfare-based model first. Let's say a rehabilitation ministry rents four houses, and buys food for 38 residents, and operates a number of vehicles.

Under the welfare or donations funded model, such a ministry is likely funded through requiring each resident to contribute a portion of their Sickness Benefits, which the hypothetical 38 residents are receiving at a cost to the public of more than half a million dollars per year (38 x sickness benefit + rent assistance x 1 year = > $552,756 per year).

Plus, let's say the rehabilitation centre receives additional funding from businesses which make donations to the Ministry in lieu of paying wages to residents who are doing unpaid work therapy in their businesses.

Operating costs include: renting the houses, buying the food, and operating the vehicles. How many hours per week would each resident need to do, on award wages, to meet that cost? Let's say seven hours and 25 minutes per week. Obviously some first-stage residents will not be able to work, while last-stage residents will be able to work longer than seven hours and 25 minutes per week. But seven hours and 25 minutes might be the average.

Instead of being paid for their work though, the money would go into the ministry, and their work would be part of their therapy and rehabilitation.

The rehab could actually be registered as a company instead of as a charity. A resident, when he applies, would enter a work-place agreement with the company. The resident would agree to participate in the program - which would include being willing to eventually do an average of seven hours and 25 minutes work per week as part of the program.

The company would agree to pay him by providing accommodation and meals, by providing the rehabilitation program, providing training, and perhaps by paying a little bit of cash - and at the end of the term of 'employment', the company would pay him a lump-sum of cash equal to six weeks rent for his own apartment when it comes time for him to leave. Or the person could opt to stay, on a new workplace agreement, on mutually agreeable terms. The terms would of course comply with the industry awards.

The company (the rehab) would change its arrangement with its sponsoring-businessesmen. Instead of continuing to receive "donations" from them in return for providing labour through residents doing "work-therapy" in their businesses, the rehab (the company) would actually contract with those businesses like a labour-provider would, and be paid. So, the rehab (the company) would contract with outside sponsoring-businesses, while residents would contract with the rehab (the company.

The rehab (the comapny) might only have to be paid for seven hours and 25-minutes work per week per resident, and the cost of operating the Ministry might be covered. (7hrs 25min x 38 residents @ $18/hr = $5,073/week = rent 4 houses @ $500 each per week + $2,000 food per week + $1,073/week vehicle expenses and other expenses).

It assumes the staff are volunteers.

Consider the advantages of this model:

Half a million dollars in welfare-payments would be saved. Donations wouldn't need to be solicited. Businesses can make a certain amount of financial gain. Residents would feel the dignigty of being able to say that they are "employed" by a company instead of saying they're in Rehab.

And the director of the rehab himself can benefit, because if it was run as a Charity, he either volunteers his services, or the most he can profit from it is to receive his own wage - but if he operates it as a company, then he has every right to profit from it as much as he can.

If it is a Charity, it should be a goal of the ministry to have residents finish their dependency on the organization as soon as possible and move-on - but if it's a company, then the Director has every right to inspire his 'employees' to want to continue their relationship with the company for the long-term.

A similar model could be utilised in order to replace Single-Mothers Payments with a capitalist model. A company like a large supermarket or department store could provide the service while at the same time profiting from it.

These stores could own accommodation. They could enter into a workplace agreement with a single-mother to work for their company, and be partly paid with accommodation, and partly with cash.

In order to transition from the welfare-based model to a business-based model, a two-tiered system could be temporarily put in place. Residents could continue to do a one-year Rehab program funded by Centrelink and donations, and then a second-year program could see residents employed by the commercial arm of the ministry. Feasability studies would have to be done into the ministry operating its own for-profit businesses.

Examples of possible business could include: furniture removal; cleaning; pest control.

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