Public: Policy-making | Public

Don't ringfence me in

Tue, 16 Feb 2010 11:30:31 GMT

David Parsons, a Leicester councillor and leading Tory light in the Total Place movement, wants to abolish all ringfencing of council funds. He just has to persuade 'sceptical' colleagues, he tells Max Rashbrooke

For someone who has spent so long in local politics, David Parsons has retained a surprising degree of naivety, in the nicest possible sense of the word. A mere two questions into an interview with someone he's never met, he is launching into a no-holds-barred analysis of the Conservative frontbench with a candour that appears to be giving the press officer sitting opposite a heart attack.

"You will be nice to me, won't you?" Parsons says, halfway through this off-the-record assessment – a phrase he repeats at intervals. At another point, he stops in the middle of an impassioned defence of local councils to remark, "You're not actually going to print any of this, are you?" – not aggressively, but with an almost childlike wistfulness.

A solidly built 59-year-old, with tidy grey curls, Parsons has been the Conservative leader of Leicestershire county council, a four-star authority, since 2003. As well as chairing the local government improvement board, he sits on the high-level board overseeing the Total Place pilots.

The government is right behind Total Place, he says, as evidenced by the presence on the high-level group of Liam Byrne, the chief secretary to the Treasury, who in Parsons's phrase "really gives this some oomph".

The Conservatives have, of course, been loudly proclaiming their localism credentials since David Cameron's ascension. But do the Tories really believe in local government?

Off-the-record remarks aside, Parsons says he is "working on" his frontbench colleagues.

There are still sceptics around. But support for the initiative is growing

Some were sceptical of Total Place at the outset, "and there are still sceptics around". But support for the initiative is "growing", he says.

"The more the project has gone on, the more it has picked up the pace, the more it's shown what it could do – [the more] people have seen it could well offer the solution to the dual problem of a lack of joined-up services and the lack of money in the public purse."

His main concern now is that there remain too many Tories who are no more fond of local councils than they are of government in general, and who would like funding to bypass councils and go straight to individuals.

This highlights a fundamental tension within the still unclear Conservative manifesto: how to give more power to individuals, in the time-honoured Tory way, without losing what Parsons calls the "overview of the locality", the ability of councils and other bodies to deliver joined up-services and run them more efficiently.

Parsons fears that giving money directly to individuals will prove "expensive" because it will feed their demands for more money as their expectations of public services rise.

"How do you control the horizon [of public expectations] if you provide services that could be limitless?"

He then raises an interesting point about accountability. Even quangos – which he would, unsurprisingly, like to see abolished – are accountable to Parliament, but how will individuals be held responsible for spending public money? "If you give people money, how do you hold them accountable?"

Taking the flak

Handing power down to councils would have one cynical advantage, Parsons admits: it would help insulate an incoming Conservative government from the unpopularity of budget cuts. "You can make savings nationally, and hand them down to councillors who whine," he says, "or you can make them locally...

"Why the hell would they [the government] make decisions when we can take all the flak?"

Parsons would also like local councils to have total freedom over their budgets. "I'm in favour of abolishing all ringfencing," he says. What, all of it? "Every single bit of it."

When asked why a new administration would break the habit of centuries of central government and cede control over funding, Parsons makes an endearingly naive appeal to his frontbench colleagues to trust their "friends" in local councils.

"Local government has earned its spurs. Why should the worst-performing part of the public sector [Whitehall] insist that the better part of the public sector have ringfenced money?

"You have got to be able to trust your friends ... with a few exceptions, we have a bloody good track record."

Public and politicians alike would have to become more confident with the idea of postcode lotteries, he says.

But wouldn't devolution of funding and power leave poorer areas left to struggle on without the help and money they need? His only answer is that some deprived areas have "superb leadership" and that devolution "need not" lead to more unequal outcomes.

Despite his ardent defence of community autonomy, Parsons believes that local bodies might need to be forced to work together to make Total Place work. The shadow chief secretary to the Treasury, Philip Hammond, has already ruled out the idea, describing forced collaboration as "old politics".

But Parsons says a law change might be needed if local bodies refuse to work together to improve services. "I do think if there is a need for primary legislation, it will be in the realm of a duty to co-operate ... you might well have to do that."

There won't, however, be a one size fits all solution, he says – adding, charmingly, "I never thought I'd say that bloody crap, but it is absolutely true."

The co-operative approach to reform

Mon, 15 Feb 2010 09:30:00 GMT

As the general election approaches, political and policymaking interest in developing mutual forms of public service provision is growing. Andy Cowper reports on developments in the health sector

Public policy may not usually be perceived as 'hip', but it can be as prone to fashions and trends as the fastest-moving consumer goods. As pre-electoral tension mounts, politicians and policymakers are increasingly looking towards the mutual, co-operative and co-owned sectors for solutions to some of the problems regarding public sector reform.

There is much speculation that Labour's manifesto will look to present co-operative and co-owned forms of provision on public services and today's announcement by shadow chancellor George Osborne demonstrates Conservative interest in this area.

The John Lewis halo effect?

Why has the mutual, co-operative movement come back into policy vogue now? Various factors are at play here. The impact of the economic recession cannot be under-estimated. Despite these conditions, there have been consistently impressive trading figures from the John Lewis Partnership (perhaps the UK's highest-profile employee partnership). All of its full-time staff become members of the partnership, and receive a share of the business's annual profits.

John Lewis's managers can be held to account by staff through democratic mechanisms at every level of the organisation (although its chair Charlie Mayfield recently told a conference that, in practice, this right is used proportionately and sparingly).

A limit to market mechanisms

The use of market mechanisms in public sector reform during most of Labour's time in office was facilitated by booming UK economic growth. Providing more staff, new buildings or technology and the capacity to offer choice were viable options in the context of a growing economy.

The medium-term likelihood for UK economic growth currently looks weak-to- anemic. One key result of this is to try to get any extra capacity out of existing providers through efficiency and productivity gains. Research suggests that one of the methods of achieving this is to examine successful examples of the mutual sector, where studies cite increased staff morale and commitment to frontline delivery as critical success factors.

Another factor is the Labour Party's shortage of cash. Private donors have been distancing themselves from the party ever since it began to look electorally mortal. The trades unions will therefore be Labour's major source of funding for the election campaign ahead.

They do not welcome private for-profit providers, but are not against mutuals and social enterprises.

In health, the NHS has already seen a significant policy U-turn away from market contestability in provision of services, with Health Minister Andy Burnham's policy announcement last autumn that the NHS is to be regarded as the "preferred provider" where existing service provision is reviewed.

Nothing new in mutual and third sector providers

Many not-for-profit and mutual providers already provide various public services. The 'third sector' of charity and social enterprises (also known in some organisational forms as community interest companies) already successfully provide mental health and drug rehabilitation services and social care through such bodies as Turning Point.

Charities in particular often deliver excellent, responsive and patient-centred services to specific groups (such as Macmillan Nurses and the Maggie's Centres in cancer care). The hospice movement for the terminally ill is almost entirely provided by this sector, and receives less than one-third of its funding from the government and the NHS.

Prior to the new GP contract in 2004, much of the out-of-hours provision of general practice was done by not-for-profit co-operatives of willing GPs.

Nor is some element of mutuality exclusive to commercial investment. Circle Healthcare is an organisation established in 2004, which mixes 49.9 ownership by its partners (mainly consultant surgeons and anesthetists to date, though some GPs are now joining) and 50.1% ownership by private equity investors and venture capitalists. Circle provides both private and NHS care, and is currently expanding and building and acquiring provider facilities. It is Europe's largest professional partnership healthcare organisation.

The impact of Circle's top-down, devolved decision-making approach to management of its facilities can be seen in its acquisition of three independent sector treatment centres – units which do high volumes of low-complexity surgery such as cataracts or joint replacement on relatively healthy patients - from a private provider. Within one year, these facilities (in Bradford, Burton and Nottingham) saw revenue day case volume increase by 22%; cost reduced by 19%; and overall revenue increased 26%.

The semi-independent NHS foundation trust sector of provider hospitals and mental health trusts was also described as a 'modern return for mutualism' by its legislative proponents to win the support of unwilling Labour MPs back in 2003, when the legislation was becoming law. Foundation trusts (FTs) win autonomy through proving high performance on financial stability and clinical quality to sector regulator Monitor.

On achieving their authorisation, FTs become accountable only to Monitor, rather than to the health secretary. They also elect their board of governors.

However, the mutuality aspect of FTs is overstated and unclear: their facilities remain owned by the NHS (or the Private Finance Initiative consortia, if relevant). Monitor's outgoing executive chair Dr Bill Moyes confessed in valedictory interviews that the FT sector had not shown the degree of innovation he had hoped.

Over the past five years, turnouts at FT governor elections have almost halved, while, the proportion of governors' posts that have gone uncontested has risen by 81%. And although FTs have a theoretical right to vary their terms and conditions to improve on those offered in NHS national contract negotiations, in practice none yet do so.

A more authentic example of mutual-type provision is the community services provider company Central Surrey Health: a not-for-profit, limited liability company, in which each staff member has a 1p share. Its creation followed the policy decision to re-emphasise NHS commissioning (purchasing and shaping health services), with the associated implication that the primary care trusts who also provided community services should have no conflict of interest as providers - becoming commissioning-only organisations.

Availability of the generous NHS pension remains a major sticking point for staff interested in working in differently-owned organisations. The Department of Health has since announced that staff transferring to new social enterprises could remain in the NHS pension scheme. However, if a social enterprise's staff also provide non-NHS services, to diversify their business, they become ineligible for NHS pension arrangements

Last summer, health thinktank the Nuffield Trust published NHS Mutual, a detailed report into the potential for mutual-type provision in health by Jo Ellins and Professor Chris Ham. Ellins and Ham suggest five broad options: greater voice and participation; employee-owned community health services; multi-professional partnerships in general practice (addressed in another 2009 Nuffield Trust report, Beyond practice-based commissioning: the local clinical partnership); a social enterprise model for primary care and community health services; or multi-professional chambers within NHS foundation trusts.

The wicked issues

Government-backed pensions are a predictable stumbling block to persuading public sector employees to consider other organisational forms of employment. Governments don't go bust (they just raise taxes), so safety-wise, their pensions are pretty gold-plated.

Others report that the position of VAT, which is charged on the income of social enterprise, makes the economics of moving to that form of provision marginally attractive. Clearly, an indebted government needs all the tax revenue it can get, so expecting movement on the VAT issue may be Micawberish optimism.

Likewise, contracts would need to be offered for sufficiently long periods for the creation of new organisations to be an attractive option. Given the government's row-back on a mixed economy of provision in health, the signals here may be too mixed for many.

There are also real issues about capital: newly-formed provider social enterprises would probably be too small to raise capital effectively. Extant facilities are, by their very nature, designed for current or past patterns of healthcare provision. Given the government's desire to see more care provided outside hospital in community settings, the future for big, old-fashioned hospital buildings may not look bright.

Yet the biggest element may be the fit of mutual-type approaches with the professed 'public sector values'. Just as important to staff in the public sector might be the ability to be more in control of their own destiny, following a decade or more of 'command-and-control' centralised approaches to reform (memorably characterised by Bevan and Hood as "targets and terror").

Paradoxically, the bossiness of central government could be one of the most persuasive arguments for moving provision into mutual forms – if they can really offer some meaningful independence on a basis that looks secure enough to tempt staff out of their 'Stockholm Syndrome'-type relationship with the state as a direct employer.

Andy Cowper is the editor of Health Policy Insight

Total Place: Can't share, won't share?

Fri, 12 Feb 2010 10:27:00 GMT

If councils are reluctant to follow the Total Place agenda of working together to deliver services more cheaply, will ministers force them to, asks Max Rashbrooke

After Total Place, what then? Though it might seem premature, attention is already beginning to focus on how, if at all, its recommendations will be forced on local bodies.

Though ostensibly about improving local services, Total Place has been caught up in the relentless search for public spending cuts. That creates a dilemma for parties wanting to save money without wrecking their localist credentials: enforce collaboration, or not?

The assumption is that if local bodies work together, they will find savings. Claire Kober, the Labour leader of Haringey council in north London, says the last decade was all about seeking efficiencies within individual organisations.

"The next decade," she says, "is about taking the thinking from Total Place and looking at [how to get] efficiencies across organisations."

But some local bodies, for whatever reason, won't want to play nicely with their neighbours and peers. So what would the government do, if it believes it can't achieve savings it has promised the public without precisely that collaboration?

The present government is still considering its response to the Total Place pilots, and won't respond officially until the budget expected in March.

The Conservatives, for their part, insist that local collaboration will come about as a matter of course. One of their shadow Treasury ministers, Philip Hammond, said recent: "The pressure to do more with less, and transparency, will drive decision-making at the local level.

"Of course it is possible that local authorities will have no part in that - [that] they are going to cut services rather than hunt efficiency gains. Our job then is simply to make sure democracy holds them to account."

Susan Williams, the former Conservative leader of Trafford council and a parliamentary candidate for Bolton West, agrees. Collaboration is "not something that you would force upon people ... it's going to be up to local councils on how they wish to work together."

Enforcement process

Others are more sceptical of such relaxed noises. Chris Leslie, the director of the New Local Government Network thinktank, says ministers "will be bound to have some sort of [enforcement] process. If they [councils] don't budge in the way they want them to budge, it will be too difficult for them to achieve the savings they want."

The "danger" of the Total Place process, he says, is that the government will start giving "very crude instructions" to enforce collaboration.

To do so would be to miss all kinds of local sensitivities: for example, that councils might want to work with other councils of a similar size and nature, not just their nearest neighbours.

Better, then, to provide incentives for collaboration - but perhaps not in the current way. At the moment, the reward for councils delivering services more cheaply one year is often a reduced budget next time around, Leslie says.

Different incentives could involve giving out local grants only in exchange for performance above the average - effectively saying, "if you are overly expensive in your services, you are not going to keep that money", as he puts it.

Or ministers could require local bodies to give up a percentage of their grant to an overarching body such as a local strategic partnership, forcing them to take budget-pooling seriously.

It would still be trampling on local autonomy, Leslie admits. But, he says: "If that's where the money comes from, it's the lever they [government] will have to use."

Williams acknowledges that the implication of not working together is that councils "would have to find different ways of cost saving".

Central government may not crudely push local councils together, in other words - but falling grants will do the job anyway.

Public Services Summit 2010: Anticipating the challenges ahead

Jane Dudman — Wed, 10 Feb 2010 11:18:21 GMT

Delegates and speakers at this year's Guardian Public Services Summit agreed on the need for change, as long as any transformation is carried out skillfully, without confrontation was the underlying message, writes Jane Dudman

One thing is for sure: none of the public managers who attended this year's Guardian Public Services Summit could be in any doubt that change is on the way for the sector.

The two-day conference, which took place in Hertfordshire at the end of last week, was notable for looking both backwards and to the future.

Leaders and thinkers summed up many of the of the key aspects of the past 12 and a bit years of running public services under the Labour government, and attempted to anticipate some of the challenges that will face them in the coming years.

Sir Michael Bichard, director of the Institute for Government and a former permanent secretary with considerable influence inside Whitehall, summed up the mood of many when he said, introducing a session looking at resistance to change in the public sector, that there has already been "fantastic change" in the public sector.

Following Bichard to the speakers' podium, Professor Christopher Hood, director of the Economic and Social Research Council's research programme, agreed that what we need now is a grown-up debate, focusing on which kinds of change and innovation different organisations are best at doing.

So far, then, the conference agreed on the need for change, as long as the debate was framed in the right way - and as long as change, particularly cultural change in organisations, was handled skillfully and not in what one speaker described as "an unnecessarily confrontational way".

A strong reminder of why change is still needed in the way public services are delivered came from Craig Dearden-Phillips, chief executive of the charity Speaking Up, who told delegates that despite discussion of more joined up services, from the point of view of the disabled people with whom he works, very little has changed and it is still a struggle to deal with the many different arms of the state, a point reinforced by another speaker at the conference, Charles Leadbeater, founder of the public service design agency Participle.

Describing the work of his organisation with families in need, Leadbeater, too, put forward a view of public services that was far from joined up: "It wasn't that these people weren't getting services," he said, "but that the services came in and out and added to the chaos."

The international and local focus was on budget cuts

Add to this the view from the politicians at the conference, who from both an international and a local focus emphasised the need for budget cuts, and a truly gloomy picture might be thought to have emerged.

In fact, the converse was true. It is clear that public sector leaders and those in the voluntary sector, as well as social entrepreneurs, may not be relishing the crisis, but certainly see the need for real leadership in difficult times and are ready to rise to the challenge. The idea of not wasting a good crisis was heard around the conference floor more than once.

Above all, the summit is a place to exchange and hone ideas. As Stephen Bubb, the chief executive of the Association of Chief Executives of Voluntary Organisations, says on his blog, this is a place to gain good ideas.

Bubb writes: "The range of top speakers and thinkers on public service is astonishing. The debates are superb and I rarely leave without new ideas for action (my staff just love that!)".

For more coverage see today's Guardian Society

Jane Dudman

Duty bound by the Equality Bill

Tue, 09 Feb 2010 15:18:20 GMT

With the much anticipated Equality Bill will come a duty on public sector bodies to reducing inequalities of outcome, solicitor Purvis Ghani explains the legal obligations

With the recent publication of the National Equality Panel's report on inequality and an impending general election, the fight against inequality has risen up Labour's political agenda.

It is perhaps not surprising that the government is marketing the Equality Bill as part of this fight.

The Bill contains the much hyped duty on certain public authorities to reduce inequalities of outcome, which is supposed to address the barriers in life that are inextricably linked with social class.

The proposed duty will require certain public authorities to have due regard to the desirability of exercising their functions in a way that reduces the inequalities of outcome that result from socio-economic disadvantage.

The Government Equalities Office (GEO) has recently published guidance on how the duty might operate in practice.

The public authorities subject to this duty include ministers and government departments, county councils, the Greater London Authority, strategic health authorities, primary care trusts, regional development agencies and police authorities.

The GEO has defined socio-economic disadvantage as the state of being disadvantaged in life by one or more of a range of external factors, which includes poverty, health, housing and education, all of which are linked with social class.

Inequalities of outcome have been identified as any measurable differences in outcomes associated with socio-economic disadvantage.

Outcomes may be about material goods and services (such as quality of housing and healthcare) or factors that affect wider life chances (such as income, unemployment and experiences of crime).

The duty only applies in respect of strategic decisions. These are the key, high-level decisions that determine how a public authority conducts its business.

Such decisions will include decisions around setting priorities and targets, allocating resources, commissioning services and recruitment strategies.

Resource allocation and the location of key public service facilities

The GEO guidance contains numerous examples of what this might mean in practice. For example, the duty will mean that ministers and government departments may have to consider reducing inequalities of outcome when making decisions about resource allocation and the location of key public service facilities.

Local authorities may have to think again when taking decisions about cutting funding for social housing and social care.

Police authorities may have to target deprived areas when recruiting officers and staff. Strategic health authorities may have to develop plans for improving health that reduce the inequalities in health within the local population.

This may result in more specific targeting of health resources.

Taking the remit of the duty to its extreme, one could even argue that the Treasury would have to consider the desirability of reducing inequalities of outcome when formulating tax policy.

In theory, the reach of the proposed duty is wide and can help narrow the gaps in outcomes for people of different backgrounds.

In practice, however, business may well carry on as usual because the duty lacks the punch needed to make a significant difference.

The broad concept behind the duty is not new. Public authorities are currently subject to duties to have due regard to promoting race, disability and gender equality (which will be expanded by the Bill to cover gender reassignment, sexual orientation, religion or belief and age).

However, the proposed new duty is weaker than the existing duties.

The relevant public authority is only required to have due regard to the 'desirability' of reducing inequalities of outcome.

A public authority has to weigh up competing interests and meet the duty but, ultimately, it is unlikely to be difficult for it to justify taking a course of action which does nothing to reduce inequalities of outcome.

Statutory guidance is due to be published this summer, which will give us a better idea on how effective the duty will be. Assuming the Bill gets passed, the proposed duty is due to come into force in 2011.

Purvis Ghani, solicitor, employment and pensions, Field Fisher Waterhouse LLP

Whitehall reform

Mon, 18 Jan 2010 12:45:51 GMT

Influential thinktank calls for urgent reform of the civil service

Whitehall faces a "pivotal moment" and is in urgent need of a shake-up, according to a report on the heart of the civil service.

The report, Shaping up: A Whitehall for the Future, published today by the influential Institute for Government thinktank, concludes that there is a "strategic gap" at the heart of the government.

It contrasts the concentration of political power in the office of the prime minister with the fragmentation and lack of coordination at the centre of the civil service - the Treasury, No 10 and the Cabinet Office and says this has led to a relatively weak administrative centre, inhibiting the ability to set overall government priorities and translate them into action.

The report calls for a wholesale reform of Whitehall if it is to function properly after the general election.

The report is based on interviews with senior civil servants, most of whom felt the Cabinet Office should be more active in providing strategic leadership on joined-up issues. It calls for a stronger, more focused centre, with government strategy collective owned by all permanent secretaries; for departments to be led by "strategy boards"; and for a small number of ministers to be appointed outside the departmental framework, with ownership of top strategic goals and control over pooled budgets to support delivery.

Better outcomes

Tue, 01 Dec 2009 14:14:03 GMT

A new report from the Public Services Trust argues that government should pay for outcomes instead of inputs, and only pay for what it wants, will it catch on?

Shifting to paying for outcomes not inputs could save costs and deliver substantial benefits, says a new report from the independent cross-party thinktank 2020 Public Services Trust.

Better Outcomes argues that both central and local government need to rethink radically how they achieve the outcomes they seek.

The traditional focus on paying for inputs should be scrapped wherever possible in favour of 'payment by results'.

Service providers, public, private or third sectors would be paid when and if they achieved desired outcomes.

The authors argue that an outcome driven approach should be explored across a wide span of government functions. Where this was done, instead of government agencies or service providers being given budgets, grants or paid for inputs, government would pay them for when they delivered the desired outcomes or outputs.

It could bring about a revolution in the delivery outcomes desired by the public.

The report argues outcome commissioning should be explored and applied wherever possible to help minimise the risk of cuts in public services over the next decade. It explains how such an approach is possible.

Payment on performance has major advantages; the state only pays for what it wants, it transfers the risk of delivery to providers, it empowers and incentivises them to succeed and it generates great innovation.

This approach, the authors argue, should be utilised by whichever party forms the government after the next general election.

Policing in need of a radical overhaul

Jane Dudman — Mon, 30 Nov 2009 09:07:23 GMT

Despite years of investment, police performance in tackling crime could still be better. Is it time to look at how the police are organised and governed to improve the service - for everyone?

Calls for wholesale reform of British policing are gathering steam. Following last week's recommendations from Denis O'Connor, Her Majesty's Chief Inspector of Constabulary, about the nature of policing, thinktank Institute for Public Policy Research (IPPR) has published a call for radical reform of the way the police work, including strengthening local involvement in setting policing priorities.

Rick Muir, senior research fellow at the IPPR and author of the report, says that years of investment in the police by successive governments has failed to improve police performance significantly.

"Given that spending looks set to be cut, if the police are to effectively tackle crime in the years ahead, they will need to change the way they work," he comments.

"Unless the way the police are organised and governed is transformed, any substantive programme of reform will suffer the same fate as those that preceded it: opposition within different parts of the service followed by a government 'U-turn' for fear of a politically costly conflict with the police."

Muir says the first priority for reform must be improving police governance. He wants to see a system that provides value for money, is "more coherent and less fragmented and that empowers local and national leaders to deliver change in the public interest".

Last week's inquiry into the policing of the G20 protests in London by O'Connor resulted in what has been described as "a blueprint for wholesale reform of British policing".

The IPPR report says all local crime priorities should be set locally, by strengthening the role of local elected authorities, with councils directly commissioning police services.

It also calls for the National Policing Improvement Agency to be merged with parts of the Association of Chief Police Officers (Acpo), to form a new National Policing Agency. Acpo came under severe fire in O'Connor's report for its role in "unaccountable" operational matters.

The publication of two influential reports so close together will help fuel continuing debate about the role of elected officials in policing, something that has been controversial in this country.

Whether the next government, whichever party is elected, will want to tackle a fundamental rethink of policing, remains to be seen – it's previously been shied away from, as the IPPR report makes clear.

Jane Dudman

Deal or no deal?

Fri, 27 Nov 2009 10:48:22 GMT

Community groups and councils are being promised more control over public services and budgets. But how would local decision-makers cope in negotiations with the private sector, and what is the Treasury's role in any new arrangements?

Sometimes two policies, each worthy in its own right, can collide head-on. The policies of localism – greater power for community bodies – and partnership working, which of course entails more deals with the private sector, may be one such case.

All three main parties are signed up to the idea, if not necessarily the reality, of giving local bodies a greater say over public services. Among the Opposition, the Liberal Democrats have long argued that Britain's over-centralised state "has done much to harm and dampen the energies of local communities" as their Treasury spokesman, Vince Cable, recently said.

For the Conservatives, David Cameron has pledged to "strengthen" local civic institutions such as community groups and local councils, while their schools spokesman, Michael Gove, has promised headteachers more control over education budgets.

However, what none has yet addressed in detail is the question of how local bodies are supposed to manage if they are also expected, as is the trend under Labour, to engage in increasingly complicated and wide-ranging partnerships with the private sector.

A recent National Audit Office report argued that many central government departments lack the commercial skills needed to drive a good bargain. How, then, will community groups cope? How, equally, will any kind of efficiency and economy of scale be preserved if deals are done as a series of single, isolated examples?

Greg Stone is a Liberal Democrat councillor in Newcastle who has worked on several local regeneration schemes. There is already, he says, "a tension there between trying to steer regeneration benefits to the community and trying to keep the private partners around the table".

True localism, he adds, means devolving power not just to local councillors like himself but further down to community groups and parish councils. "If the people who can turn the key on this were the local authority rather than the community, it would lead to a discrepancy of resources and power."

But, asked how it would work if those local bodies were left to work directly with the private sector, he says: "I don't think there is an easy answer. I don't think there's anything in place yet."

Even among local councils, the skills needed are "a little bit lacking", he adds. "It's going to have to be addressed. Otherwise the conversations and the development of various [projects] will be conducted in a way that's very unequal, and the risk is in the interests of developers will overpower the interests of local decision-makers."

The obvious solution to this conundrum is central guidance – some way of allowing local communities to draw on a body of expertise and experience of major projects.

John Tizard, a public-private partnerships expert from Birmingham University, says there is no contradiction in such an arrangement. "In some areas, particularly areas of complex procurement, access to central resources seems to me absolutely essential for local bodies.

"It would be unfortunate if the policy were to dismantle those support services that local agencies can call on or if local agencies felt they were being discouraged from drawing on them."

Central guidance

The need for such central guidance could lead to a new role for some of the agencies – notably the public-private quango Local Partnerships - that might otherwise have feared for their future. However, their functions could equally be carried out by regional bodies, or from within central government departments.

Steve Beet, of consultants PricewaterhouseCoopers, says one solution to the local procurement dilemma could be a "twin track" approach that splits decision-making from procurement. While local groups could assess – and decide on – what needs to be done in their area, their building or services projects could be brought together with others at regional or even national level to be procured in a big bunch.

If a community decided a new school should be built, "you can quite understand that being identified locally", he says. "But no one would argue that a parish [council] leader should go through the [centralised] Building Schools for the Future programme."

However, the danger is that leaving procurement decisions with a regional or national agency will negate any real devolution of power.

The temptation for a strong, centralised agency to interfere could be overwhelming; giving advice could easily tip over into taking control.

"The big tension is going to be between local needs assessment and consolidated procurement," Beet admits. "It's going to be an interesting challenge for the Treasury."

But how will that tension be resolved?

"This is the unknown," he says. "This is the bit all the parties are struggling with – what is the glue that sits between localism and community engagement and the central functions that can support and deliver what they require?"

Standing on the cliff edge of criminalisation

Tue, 24 Nov 2009 15:58:07 GMT

The Young Adult Manifesto is a new initiative from the T2A Alliance which looks at strategic areas of intervention to prevent young adults ending up in jail

Regardless of the figures and statistics, much of our mainstream media has decreed that Britain's streets are ravaged by a generation of young offenders with little respect for the norms of our society.

The reality, as any frontline community worker or service provider will tell you, is much more complex.

High profile cases such as the killing of Rhys Jones in Liverpool or Ben Kinsella in London have sparked unprecedented media attention on youth crime but these crimes are comparatively rare.

In the meantime, there is still a worrying lack of focus on the vast majority of young adult crime which falls outside of the serious, violent offences.

Strikingly there is also a real deficit of understanding among the media, the public and even some policy makers and practitioners when it comes to defining the very group they are trying to deal with.

We are all aware that a worrying number of young adults commit offences.
However, there is a lack of recognition of the distinct nature and needs of Britain's marginalised 18-24 year olds who, unlike an increasing number of their peers who head to university or vocational training, are often highly vulnerable, suffer from mental illness, homelessness and drug and alcohol abuse.

These young people, not children but far from fully fledged adults, are standing on the cliff edge to criminalisation.

In Britain we still define offenders as either children or adults. Unlike in European states such as Germany and Sweden, social services and the criminal justice system still classify people caught up in the system as either minors or full adults, there is no middle ground where young people are understood to be in a stage of transition to adulthood.

Serious implications for our society

This has serious implications for our society and how we deal with marginalised young adults who are particularly at risk of getting caught up in cycles of crime. Youth crime is a red herring. In truth it is 18-24 year olds who are committing the majority of the so-called 'youth crime'.

Young men who fall within this age group make up a third of all those locked up in British jails, a third of those committing all crime, and a third of the people on probation.

Despite this astonishing fact we are clearly not doing enough to tackle the problem. There are still very few services adapted specifically for this group and the justice system continues to treat these young adult offenders in the same way it treats seasoned criminals twice their age.

It is this rigidity within public services and the criminal justice system that helped trigger the formation of the Transition to Adulthood (T2A) Alliance.

Convened by the Barrow Cadbury Trust, which has historically funded service providers supporting young adults involved in the criminal justice system, the group includes a range of organisations looking to refine the way society and specifically policy makers deal with young adults.

Alliance members include organisations such as Catch22, the Howard League for Penal Reform, the Prince's Trust, the Prison Reform Trust and the Centre for Crime and Justice Studies.

The T2A Alliance's aims are essentially two-fold; first to underline the often unique needs and issues surrounding marginalised 18-24 year olds, and second to set out a comprehensive set of policy proposals to help address the issue of crime within this age group.

Sadly, there are a proportion of young adults who, for whatever reason, will continue to commit crimes, but anyone working in this field will tell you that there are also a large proportion of young adults who should not be in prison in the first place.

With reoffending rates for the young adult age group standing at 70%, this is not about being soft on crime; it is about being pragmatic and changing a system that is clearly not working. We need to have a proper and informed debate about how public services can be better utilised to help push marginalised young adults away from crime.

And for the generation who are already involved in the criminal justice system we must think of innovative and robust alternatives to simply locking them up.

Shan Nicholas is deputy chair, T2A Alliance

The low-carbon economy

Fri, 20 Nov 2009 11:39:00 GMT

Ahead of next month's climate change conference in Copenhagen, the Department of Communities and Local Government has announced new initiatives - and a new scientific adviser

With the realisation growing that buildings are collectively the equal of roads, railways and airports combined when it comes to squandering carbon, and that they account for nearly half of the UK's carbon output, the run up to the Copenhagen climate change conference next month is producing a raft of new measures and proposals that seem likely to put local authorities at centre stage, both as enforcers and exemplars.

The Department of Communities and Local Government (CLG) new scientific adviser started in his post this week. Professor Jeremy Watson, who is head of global research at global design and business consulting engineering firm Ove Arup and Partners, has taken over the role of scientific adviser to the CLG.

His job at Arup will now be just part time as he takes up the role of ensuring that CLG policy is "underpinned by the best science and engineering advice available" particularly in respect of sustainability, technological development, and renewable energy.

But before Watson had properly got his feet under the table, CLG housing minister John Healey this week announced the publication of a consultation paper whose measures, if adopted, envisage the installation of new solar roofs at stadiums, schools and railway stations, the recladding of office buildings with solar panels and the erection of wind turbines up to 15m high on industrial estates and in agricultural areas.

Similarly, householders would also be able to add wind turbines and air source heat pumps to their properties without consent, extending the right to add solar panels and biomass systems that was introduced last year.

Naturally, there will be rules and the conditions and thresholds that are proposed are a key part of the consultation according to the government announcement.

The Royal Town Planning Institute (RTPI) is seeking its members views on the proposals but Kelvin MacDonald, policy adviser at the RTPI, has said that the institute supports the initiative to make it easier for householders and businesses to install renewable technologies.

But he added that it is also important that the proposals take account of local circumstances and historic buildings.

Healey's announcement followed swiftly after his call last week for a "national crusade" against climate change. However, the proposals have been around for a while and give substance to proposals contained in the 2007 Planning White Paper, Planning for a Sustainable Future.

The CLG is not the only department with the low-carbon economy on its mind. Energy conservation is both problem and opportunity and the department for Business, Innovation and Skills is keen to ensure fair play when it comes to dishing out the opportunities presented.

At the TUC 21st Century Economy Conference earlier this week, business minister Pat McFadden announced the creation of the Forum for a Just Transition, which is a body established to ensure that the opportunities and challenges of moving to a low carbon economy are shared equally around the UK.

McFadden said that it is important to ensure that there is a fair distribution of costs, benefits and new employment opportunities.

London 'missing Olympics opportunity'

Wed, 18 Nov 2009 12:19:24 GMT

London won the 2012 Games on a strong social message promising inclusion and participation, but so far these traits have not been followed up, says former Downing Street adviser

A former Downing Street adviser has said that the capital is not exploiting the full potential of the Olympic Games to rejuvenate the city.

Matthew Taylor, now chief executive of the Royal Society of Arts, Manufacturing and Commerce and a policy adviser to Tony Blair when he was prime minister, was speaking at the Capital Ambition conference organised by Kable.

He said that London is suffering similar problems to other major cities due partly to a gap in aspirations between different social groups, and there is a need for a debate about how its citizens can become more self-reliant, engaged in issues and more altruistic.

"The Olympics (due to take place in the city in 2012) provide a really good opportunity to debate what kind of city we want London to be, but we have failed in this respect" he said.

He said the Olympic cities that have proved successful in recent years have had a powerful story to tell at the time, citing the examples of Barcelona emphasising the rebirth of democracy in Spain, and Beijing conveying China's emergence as a superpower.

London won the Games on a powerful social message about inclusion and participation, but his has not been followed up.

"I think we are missing a trick," he said. "It doesn't cost a lot, but the Olympics creates the focus for the kind of debates we need to have. It's about issues like what responsibility does any person in London have, but there's no momentum behind it.

"There's going to be a very powerful operation to run the events, followed by a degree of regeneration, but there is no popular mobilisation.

"We've got to have a bigger, better conversation as we will face some incredibly tough choices over the next two or three years."

Falling productivity mars Labour's record

Tue, 17 Nov 2009 11:18:21 GMT

A new report from the Office for National Statistics shows that the government's huge increase in spending on services was not met by a rise in productivity - will the recession help cut the slack?

The November winds battering Britain have ushered in more bad news for a beleaguered Labour government: figures released last week by the Office for National Statistics (ONS) indicate that public sector productivity fell overall during the Blair-Brown years, despite increasing investment.

The report, Changing costs of public services, shows that during 1997-2007 the unit costs of public service output grew by 13.7% more than those for the whole economy, an annual average relative rise of 1.3%; productivity fell by 3.4%. The only sectors quality-adjusted were health and education, which account for 50% of all public services spending; outputs in other sectors were assumed to rise in line with inputs.

An expanding public sector is one reason for the fall, according to professor Michael Ben-Gad of London City University. If output is measured by how much a company produces divided by its number of workers, then an increase in staff without a concomitant rise in capital will inevitably result in a drop in productivity.

"The UK has been increasing public sector employment quite substantially over the past 10 years," says Ben-Gad. "During the boom times Labour expanded the state faster than the economy was growing, and assumptions were made that there would not be another recession. We'll probably see productivity improve in the UK, as recently in the US, for the simple reason that there is high unemployment. Cut staff and there are fewer working with the same amount of capital. The denominator is getting smaller, so productivity shoots up."

Given the injection of new resources during New Labour's first decade in power, Siân Thomas, director of NHS Employers, says productivity hasn't improved to the extent it could have: "With economic growth and politicians giving manifesto commitments for more staff, it was entirely predictable that's what we would get. That was the goal and how we've improved access for patients." But while investment was necessary, it came quickly and in large amounts, without the "fantastically different mindsets" required to manage productivity at that level. "It is hard to deliver increased effectiveness and efficiency with 5%-7% growth year on year," she says. "Any company would struggle with that."

Professor John Van Reenen of the LSE's Centre for Economic Performance, says the ONS findings were entirely expected. "While the fall in productivity is partly attributable to the way public sector productivity is measured – it's hard to pick up the quality improvement of, say, a fall in waiting times for operations – these figures do reflect some reality," he comments. "Typically, increasing spending without changing the way a firm is organised and does business will contribute little to productivity."

Defenders of the government point to signs of growth – NHS output improved in 2006-2007, for example – as evidence that Labour's investment is paying off in the longer term. The latest Audit Commission figures agree that NHS productivity, driven by acute and specialist trusts, has been increasing in recent years. Unit costs in 2007-08 were down 3.7% on those of two years earlier. All of which begs the question: will the recession and tighter public sector budgets see an improvement in productivity?

"People innovate more in periods of austerity," says Thomas. "Tighter budgets will focus us to reduce duplication, streamline services and provide more cost-effective solutions. There will inevitably be a debate about a reduction in hospital beds and acute services, as well as moving from hospital care to community and GP services. We need to have a different mindset of doing the same or more work in the right place, such as community-based work, with far less money."

Wage freezes may be one way to drive productivity, but there will be a limit to what belt-tightening can achieve. According to Thomas, a report by the Institute for Fiscal Studies and the King's Fund on the bleak financial future facing the NHS shows things have to radically change: "if they don't we will literally run out of money, because we won't have the revenue and the allocations from government".

Politicians seem unwilling to grasp the nettle of systemic change, however. Ben-Gad says pre-election debates will centre on who can manage the public sector better, rather than fundamental shake-ups. "The Tories will no doubt promise skyrocketing public sector productivity, but there is little discussion or difference in ideology among the two main parties in terms of re-evaluating the size of the public sector," he says.

"Productivity" is a useful concept on the factory floor, but is perhaps less meaningful as an objective measure of public services. Still, even with so many intangibles and variables involved, it is important in terms of getting as much out of fixed and decreasing budgets as possible, says Dr Deborah Wilson of the Economic and Social Research Council.

Public sector productivity will be coming under increasing scrutiny through 2010: "We'll be looking at a period of trying to get more for less, which is essentially exactly what productivity is trying to measure, and this is increasingly going to be the case as frontline resources come under more pressure."

Thomas concurs and says the important thing is to have agreed goals from defined inputs: "By assessing the level of productivity required to achieve a specific outcome we are better able to judge if the results are aligned. In this way we ensure that measuring output isn't simply about whether a number has increased or not."

Civil service in line of fire over MoD bonuses

Fri, 13 Nov 2009 12:06:56 GMT

Criticism of Ministry of Defence 'bonuses' is very unfair and misleading, says union

Criticisms of 'bonus' payments made to Ministry of Defence civilian staff are very unfair and misleading, said the FDA, main union representing senior managers and professionals in the civil service.

Its general secretary Jonathan Baume said: "This criticism is very unfair. We are talking about tens of thousands of people working very hard to support our troops. Many of these payments are made to people serving alongside the military – in Iraq and Afghanistan. They include a very wide range of technical and professional staff."

He also criticised ministers for their lack of clarity regarding so-called bonuses.

"Ministers have insisted on similar schemes in most departments, and it is about time ministers went on record defending the arrangements that they put in place."

Baume said that the payments themselves are not bonuses in the way that most people would understand them.

"They are non-pensionable, are not carried forward to the next year and are taken out of the overall pay pot set by ministers.

"This means that, over recent years, pay levels for civil servants in the Ministry of Defence have been depressed.

He added: "Over the past 25 years successive Conservative and Labour Governments have handed over to civilians many jobs that were previously done by members of the armed forces.

"These are jobs that in many countries are still done by the armed forces – and it costs substantially more to employ the armed forces for work that civilians could do."

Not simply a numbers game

Thu, 12 Nov 2009 10:05:00 GMT

Performance measurement of public services needs a rethink and a new approach to reflect today's cold fiscal climate, says a new report

With government budgets under growing pressure, the way that Britain's public services are measured and monitored needs to be rethought, according to a policy briefing published by the Economic and Social Research Council's Public Services Programme.

Costly measurement schemes will come under greater pressure to justify themselves. For example, questions need to be asked about whether the annual cost of running Ofsted (£207 million) is worth almost 5,000 teachers; or whether the annual cost of running the Care Quality Commission (£167 million) is worth almost 4,000 nurses.

The report, written by professor Christopher Hood, Dr Ruth Dixon and Dr Deborah Wilson, says that lower cost performance indicators should not necessarily be coupled with targets or rankings. Rather they should aim to provide high quality 'intelligence' for improvement, information in which both public service providers and the public can have faith.

The authors argue that as public sector budgets are squeezed, there is likely to be more focus on input reduction and productivity targets – providing more for less – and subsequently perhaps less focus on user satisfaction measures.

Huge investment has been put into 'managing by numbers' – league tables, targets and other performance indicators. But do they work?

The policy briefing reviews the use of performance indicators in Britain over the past 10 years and shows that:

• there is no guarantee that the benefit from performance management regimes – either in terms of improved public services or political payoff – is worth the cost

• public service quality is not always improved as a result. The outcomes of target and ranking schemes are hard to predict and may distort the behaviour of public service providers

• the numbers themselves may be unreliable, and the league tables that result may not distinguish between providers – schools, hospitals – sufficiently for people to be able to make a meaningful choice

• it has not been a successful political strategy: public support for Labour's policies on health fell alongside falling waiting times for hospital treatment. And Britain is ranked lowest of all European countries on the trust its citizens have in government statistics.