Saving money on public services in these times of austerity will necessitate big cultural changes in public sector management, according to new reports on both local and central government.
Most of the emphasis on managing public budgets has been on ways to save money, but Mike Turley, head of public sector practice at management consultancy Deloitte, which on 9 June published a report on making public services more efficient, says more important than implementing practical changes will be a change in attitude among those leading public services, particularly in relation to areas such as asset management and property management.
"The culture and attitude needs to shift," comments Turley. "Each organisation needs to shift from thinking about its own property, for instance, to looking at the most effective way to provide services."
Others agree: RSA-based thinktank, the 2020 Public Services Trust has two reports out today on the challenges facing public services and says it is time to reassess not just the way public services are organised, but their very purpose.
In the face of changing expectations and demographics, policy makers need to respond to pressures on cost, but must also secure public consent for the state to act in new ways, such as encouraging citizens to change their behaviour.
Deloitte's report, Counting the Cost, counsels public managers to begin preparing now for the more difficult decisions they are going to have to make from 2011 onwards, when budgets are expected to becoming much tighter.
The report identifies a number of ways in which public bodies can cut costs "in an effective and sustainable way", including:
• establishing adequate property and asset management skills
• reducing headcount and payroll costs
• embracing collaborative working by establishing genuine partnerships
The report takes on some of the findings of the Cabinet Office's operational efficiency programme, whose final report came out in April, but adds a private sector spin to them. For instance, it includes recommendations about getting government assets into shape, though "engaging appropriate expertise at an early stage", before setting them off.
That's something that would be done in the private sector, says Turley, but does not always happen in the public sector.
"We have to move things from being unthinkable to being thinkable," he comments, adding that many public managers are well-versed in financial management and audit, but are still failing to prioritise concepts such as collaborative working, selling off assets, cutting jobs or sharing property.
The report calls for public bodies to make their employment contracts more flexible, to aid redeployment of staff.
Turley also says there should be a single minister whose job it would be to get value for money from all government departments and produce a business case for major changes - including machinery of government changes.
That would, of course, come up sharply against the political agenda. It would be a brave minister to tell their prime minister set on machinery of government change that such a course of action could produce no clear return on investment.
Meanwhile, local government managers also need to focus on cultural change, according to Nigel Keohane, senior researcher at thinkthank the New Local Government Network.
Keohane is leading research into the reform of public service commissioning, due out later this month, and says the risk averse nature of too many local government senior managers is a barrier to getting more innovative approaches, which will be needed as times get tougher.
"We need to focus not just on the cost of things," he says. "We need to challenge the way things have been done in the past and look at things that go beyond price to considerations such as the environment or the sustainability of local businesses."
From Bubb's Blog
From Flip Chart Fairy Tales
