Big Society Public Services – the Next Government Shambles

The Open Public Services White Paper, announced on 11th July, sneaked out under cover of the Murdoch mess, looks like being the next government created shambles. Like its approach to the NHS, it betrays a breath-taking lack of common-sense and understanding. The government claims its aim is to improve the quality and reduce the cost of all public services. This magical result is to be achieved by opening them up to provision by private and voluntary organisations, in competition with their existing public providers.

Mr Cameron has referred to five main aims in introducing his white paper: choice, diversity, accountability, decentralisation and fairness. The first three are standard shibboleths of the free-trade, open market ideology. They are quite irrelevant to the mass of people facing austerity. People don’t need choice so much as good quality, reliable provision where they can access it. The same applies to diversity. Choice and diversity may both be features of open competitive markets, but have little relevance to the provision of health and social services. Except on purely ideological grounds.

The real question about accountability is how it is to be delivered. The PM refers to performance and transparency, ie the publication of information which will necessarily be based on statistics which become targets for positions on league tables. That approach has been thoroughly discredited over the past couple of decades. He also talks about “payment by results”, another concept which has been fairly thoroughly discredited – would you like your brain surgeon to be motivated by a productivity bonus payment, or to be a dedicated health professional?

The other two aims, decentralisation and fairness, are more interesting. The centralisation of control by successive governments has created massive bureaucracy. That process should surely be carefully reversed where possible. Regarding fairness, the emphasis on neighbourhood, community and social enterprise providers, may sound good, but it is unclear how such providers will be initiated and financed. Also, people in middle income neighbourhoods are likely to be more ready & able to get involved than those in poor neighbourhoods, so the result is unlikely to be fair. Moreover, voluntary organisations will be fairly stretched even to complete a formal bid to offer provision, never mind to actually do it.

Consequently, the result of opening public services is likely to result in bids from the private for-profit sector, against the existing public provider. And private for-profit providers can, by definition, go bust. Health Minister, Paul Burstow says the new NHS regulator, Monitor, would ensure providers do not copy the “risky business model” of Southern Cross, the bankrupt care home provider. Department of Health officials are working on proposals to require care home operators to take out bonds underwriting the continued care of their residents in the event of going bust. That really is the archetypical bureaucrats’ answer. When the private provider goes bust the bond, provided by City operators, covers for the consequences.

So what will be the value of these bonds? The ‘market’ will decide. And when hedgers and the like foresee the probability of a provider going bust they can short the bonds and make a killing. They might even, in their playful way, put it about that a provider is in difficulty, so they don’t have to wait too long. So not only would the process add a further layer of bureaucracy as well as additional cost by requiring a payment to the City, but it will also provide further opportunities for the City to do its parasitic best on the public sector, as it has on the private. The whole mess has the immediate and enthusiastic support of City audit and tax consultants, KPMG, who can hardly wait to get their hands on it.

The only problem in the bill’s progress is that the PM, since his consorting with the Murdochs, is no longer really trusted any more. His aims are widely regarded with suspicion. It may all be just a ruse to cut public services for right wing ideological purposes. And it is, of course, now more widely understood that, in the end, it will be the people who have to pick up the tab.

The white paper invites comments during what it calls ‘the listening period’ until September (see ) and then will set out how departments ‘will take forward ideas to implement open public services’ in November. That is some timescale which hardly lends credibility to the listening process. But it would be negligent not to respond.

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