The former Australian Government led by John Howard attached extraordinary importance to "family" not only as a place for care but also as a  bearer of social welfare. Since 1997, the Howard Government had adopted tax policies based on the male-breadwinner model which supported "the  family", the "Australian traditional" nuclear family, as the ideal. On the other hand, the government promoted a further movement toward  welfare reform driven by neo-liberalism which started in the 1980s, and as a means to achieve that reform, the government launched a four-year  policy called the "Stronger Families and Communities Strategy" (the Strategy), a policy for other types of "families", in 2000 and renewed it in  2004. Through case studies of the projects funded by the renewed Strategy, mainly based on interview analysis, this paper examines limits and  negative consequences of the expanding neo-liberal welfare reform under the Howard Government and explores possibilities of overcoming these  limits and outcomes by examining the efforts of community groups and other organizations at the grassroots level to turn these severe situations  into their opportunities.
 The interviews were conducted with organizations carrying out community-based projects mainly in the Melbourne area, funded by the renewed  Strategy. These projects were "Communities for Children-Broadmeadows", "Eastern Melbourne Parenting and Relationship Skills for Multicultural  Families", and "Mothers, Fathers and Newborns: Preventing Distress and Promoting Confidence Program". Project target regions included six  areas centered around Broadmeadows in the City of Hume; Monash, Whitehorse and other six areas in the eastern suburbs of Melbourne; and  Yarra, Casey and other areas in the State of Victoria. Two of these regions in particular were explained as disadvantaged, or culturally, linguistically,   and religiously diverse.
 As the actual means for promoting a neo-liberal social welfare system, the Strategy aimed to strengthen families and communities to achieve self-reliance. While revealing the difficulty of accomplishing that goal because of the severe funding situation, an analysis of the interviews  clarifies the flexibility of these organizations in moderating and avoiding negative results of stigmatization and marginalization of welfare recipients  caused by the Howard Government family policies and in using the projects as an occasion to appeal to the government on behalf of community  needs. Although the Rudd's Labor Party ousted the Howard Government in the general election of 2007, it is still significant to look closely at the  former government's family policy since the Labor Party won the election emphasizing social policies as well as industrial relations using "working  families,"and the Rudd's family policy seems to share some features with the Strategy.