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11.12.13

Public service reform: first you see it; then you don’t

Source: Public Sector Executive Nov/Dec 2013

Chris Painter, emeritus professor of public policy and management at Birmingham City University, critically examines the widely-accepted claim that the Coalition Government is presiding over a programme of radical public service reform. 

The Cameron-Clegg coalition government prides itself on the radical nature of its programme of public service reform, particularly in the fields of criminal justice, education, health and welfare. Indeed, they like to present this as a defining characteristic of their mission in office. Yet, it is a reform trajectory going back at least to the beginnings of the ‘Thatcher revolution’ and gathering momentum during the New Labour years.

This article poses a deeper question that runs contrary to conventional wisdom and perception. Are the Coalition’s claims of radical reform something of an illusion?

Scratching the surface

Two examples will suffice to illustrate the significance of the question; first healthcare. Many critics regard the 2012 Health and Social Care Act as an evasion of the fundamental reconfiguration necessary to reconcile increasing demand pressures – not least because of demographic trends and an ageing population – with tighter budgetary constraints. Thus, the outgoing chief executive of NHS England saw the Coalition’s re-organisation as a wasted opportunity, with independent bodies such as The King’s Fund expressing similar concerns. From these vantage points, the principal challenges are rationalising hospital services, especially those involving procedures of a high technical order, along with a more seamless configuration of treatment in such settings and that in community-based services – including social care.

Much of the reform so far has therefore arguably been tangential, or even acting contrary, to these underlying requirements. On the health side it is NHS England now endeavouring to drive this agenda forward, responding to political signs of panic over an emerging crisis in accident and emergency services. Steps are also afoot for elderly patients to have assigned general practitioners, with enhanced services for those suffering from complex health conditions, in order to reduce hospital admissions. Such ad hoc initiatives, however, involve relatively small resource transfers.

And planned steps towards pooled budgets for health and social care through the grandly titled ‘integration transformation fund’ remain very tentative.

The second example is the Coalition’s insistence that far-reaching welfare reforms are being undertaken and from which it appears to be reaping some political dividend.

Yet, no matter how much is lopped off the welfare bill in the short term, if the main drivers of welfare claimant numbers are not tackled then the upward pressures remain in place. Those root causes relate to factors such as shortages of affordable housing and the increasing prevalence of low-wage employment.

Against this backdrop, welfare ‘cuts’ can have the paradoxical effect of reversing, say, progress previously made in reducing levels of child poverty – the fragility of which has been highlighted by the Institute of Fiscal Studies – whilst simultaneously failing to contain the trend welfare budget. Indeed Peter Hill, in the May 2013 edition of the Public Money & Management (PM&M) journal, detected a trajectory of ‘path dependency’ rather than ‘radical’ departure from previous policy.

Formulaic approaches

Coming to terms with the dynamic behind social policy issues, such as those described above, is a complex challenge. The Coalition’s almost rote take on ‘reform’ can be a hindrance rather than help in pursuing the necessary creative solutions. The formulaic ‘open public services’ approach too frequently translates into crude outsourcing, even though the consequent fragmentation of service delivery may detract from the collaboration/integration often essential for more effective outcomes and greater value-for-money. Thus, one of the key considerations behind the Coalition’s structural re-organisation of the NHS was to facilitate entry of more alternative providers into a healthcare market.

It is an approach replicated across the board. The administration of justice forms a striking case in point. Plans to competitively tender supervision of medium and low-risk offenders, with community rehabilitation companies replacing existing probation trusts, will leave a smaller national probation service only responsible for work with high-risk offenders. These plans have been adjudged by internal assessments to pose a significant threat to operational performance standards, potentially compromising public safety.

And this in a context where the Serious Fraud Office is carrying out a criminal investigation into alleged overcharging by the private security company G4S for offender electronic tagging contracts. In addition to being caught up in the above investigation, City of London police were examining paperwork discrepancies at the outsourcing specialists, Serco, relating to prisoner escort contracts in East Anglia and London.*

Even a former adviser to the prime minister voiced reservations about a scenario in which large segments of the justice system could finish up in the hands of a cartel of outsourcing companies.

At the very least, a more intelligent and joined-up – as well as more accountable – approach to commissioning public services is desirable. A Cabinet Office-led review of contract management is partial recognition that the handling of the outsourcing process leaves something to be desired.

The ‘top-down’ reflex

When first formed the Coalition was fond of contrasting its preferred ‘bottom-up’ approach to performance management of public services with the ‘top-down’ instincts of New Labour. As I pointed out in the January 2013 edition of the Public Policy and Administration journal, this was always a simplistic juxtaposition, given the way in which New Labour’s public service reforms evolved between 1997 and 2010. But those top-down reflexes have, in any case, still proved to be addictive.

Leave to one side an extraordinary degree of centralisation in schools policy brought about by the current education secretary. The relish with which the health secretary, Jeremy Hunt, announced Ofsted-style inspections and ratings for hospitals in response to patient care scandals such as those as Mid-Staffordshire and Morecambe Bay speaks volumes!

Along with this comes the familiar repertoire of ‘hit squads’, ‘special measures’, ‘naming and shaming’ and an elite corps of
‘super managers’ so associated with failing schools, including an ultimate sanction to suspend a hospital trust’s board and appoint a special administrator instead.

This re-invigorated Care Quality Commission (CQC) inspection regime, complete with a chief inspector of hospitals, as well as new chief inspectors of primary and adult social care, ostensibly addressed mistakes made during the inception of the organisation back in 2009. But is it as much a question of Whitehall ministers reverting to type? Categories used by Gwyn Bevan and
Deborah Wilson to encapsulate different strategies for public service performance improvement in the July 2013 edition of PM&M are revealing.

Their four models are professional trust and altruism (T&A); hierarchy and targets (H&T); choice and competition (C&C); and transparent public ranking (TPR). As pointed out earlier, whilst the coalition’s default position has been C&C, recent initiatives discussed in this section are a combination of H&T and TPR.

Implementation slippage

For decades the public policy academic literature has been replete with case studies of difficulties encountered when converting policy into effective action, with many tales of woe arising from ‘implementation deficits’. The coalition has reached that phase in office where it is coming up against such hard realities.

There are mounting problems surrounding the centrepiece of the work and pensions secretary’s welfare reform programme, Universal Credit, given the sheer complexity of its ambition, with the timetable for implementation falling well behind schedule.

A recent National Audit Office report confirmed the worst fears; documenting major IT failures, poor project management and ineffective control. Even the current 2017 deadline for completing the national roll-out of the new system looks an increasingly optimistic timescale. The prime minister himself has hinted as much. Moreover, delays are also overtaking disability welfare reforms.

Then there are the risks, referred to earlier, attached to the justice secretary’s plans to outsource 70% of the probation service by 2014 because of a rushed timetable for what is, again, a complicated change programme. Here too are some of the potential ingredients for implementation failures. For similar reasons, many of the education secretary’s reforms to public examinations have had to be postponed beyond the original 2015 deadline. Part of the explanation is ministers wanting to leave a policy legacy by the artificial deadline of the scheduled date for the next general election.

Coincidentally, one of the main reasons for past policy failures by both Conservative and Labour administrations identified in the recently published ‘The Blunders of our Governments’, written by two respected political scientists, Anthony King and Ivor Crewe, is a growing propensity to do too much, too quickly.

Insight derived from consultation with those possessing relevant experience is construed as a sign of indecision and weakness. What is feasible becomes secondary to desirable outcomes, from whatever value standpoint, a mindset facilitated by systemic characteristics of our political system.

Although successive governments have made their fair share of blunders, King is on record as suspecting that the current coalition government may finish up in a league of its own. It set out determined to hit the ground running on public service reform, intent upon avoiding the evident frustrations experienced by Tony Blair in his first term in office. Even more haste was to be the order of the day!

Rhetoric and substance

Therefore despite the coalition’s contention that radical public service reform is a hallmark of its time in office, closer inspection presents a rather different impression. Longer-term fundamentals have often been side-stepped; reform is formulaic rather than tailored to the needs of each service; there are signs of a reversion to the traditional instincts of central government in exerting top-down control; and implementation failures are already in prospect as hard reality collides with political rhetoric, especially in a context of prolonged financial stringency. Most important of all, there is a world of difference between de-stabilising upheaval and effective reform!

* Editor’s note: Serco and G4S

Serco stated in July that it did not believe anything dishonest had taken place as regards the tagging contract, and that senior management had not been aware of the discrepancies.

But facing the Public Accounts Committee on 20 November, its chairman Alistair Lyons said: “It was never right that we should bill where we were not doing work in respect of that billing. That was wrong. It was ethically wrong and for us it’s one of the signs that say we need to have an attitudinal change within our business.”

It and G4S, which said overcharging the government had been “a flawed judgement”, have promised to co-operate fully with the SFO. Serco has pledged to repay past profits on the prisoner transport contract in East Anglia and the South East. City of London Police is still investigating the matter.

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