Can't Someone Else Do It?

Not long ago, Suffolk County Council announced their intention to outsource everything that they do. I have a personal interest in this as much of my family live in Suffolk, but also find it an interesting idea conceptually. For the sake of argument, why not outsource all services and just leave a few council employees in a commissioning role? There are a number of implications:

• Cost.
  
  The tacit assumption here is that the private sector can provide services more cheaply than the public sector. This may or may not be true. Yes, the private sector is profit motivated and therefore supposedly more efficient. But companies will not provide a service if they can't make a profit. If local services are privatised, council tax revenues will pay for private sector profits. Is that something people are ready to face up to?
  
  
• Quality of service.
  
  This will be entirely dependent on contractual negotiations. I mean no disrespect to local government procurement, but the private sector have better lawyers and fewer scruples. I've undertaken procurement before, and it is a tricky business even when the contract is relatively small and short-lived. For a recent example of what happens when contractual negotiations go wrong, see the saga of the Cambridgeshire Guided Busway.
  
  
• Local Enterprise.
  
  The outsourcing debate involves frequent reference to social enterprises and community groups doing things for themselves. But let's not kid ourselves. A multi-million pound road maintenance contract is going to go to the lowest bidder, and that's going to be a big company with economies of scale. Outsourcing will not necessarily cause a flowering of local enterprise. Local authorities are not legally allowed to favour local companies over others when undertaking procurement, and in the current financial situation the lowest bidder is going to win. The lowest bidder is unlikely to employ a lot of local people, or indeed a lot of people period.
  
  
• Partnership.
  
  County councils don't work in a vacuum. They have a constant need to talk to district councils, police, health services, and local residents, to name but a few. Indeed, they have legal duties to do so. Although working in partnership is time-consuming and can often seem very unwieldy, when it doesn't happen the results are often disastrous. Witness the recent cases of vulnerable children slipping through the cracks as social services failed to communicate with police and healthcare colleagues. When two (possibly competing) private companies are involved, can a reasonable level of partnership working happen? Can co-operation be secured contractually, or will the private sector just pay it lip-service?
  
  
• Accountability.
  
  This is by far the biggest issue. If all local services are contracted out, accountability will be entirely contractual in nature. The private sector is not democratically answerable to local people, except through the media. Where does this leave local councillors? They will in effect be entirely useless, and might as well not exist. Their constituents will come to them with the usual complaints about bin collection, potholes, and leisure centres, which they will have absolutely no way of addressing (beyond suggesting that they call the relevant company's helpline).
  

When thinking this through, you start to wonder why have a county council in the first place. The two-tier local council system in much of England is very unwieldy and creates a lot of duplication and wasteful political manuvering. Not that many people are aware of how local services are carved up between district and county councils, because it's arbitrary and not particularly interesting. For reference, Suffolk County Council and its peers have the following responsibilities:

• Building & maintaining schools
  
• Caring for vulnerable children (fostering, adoption & children’s homes)
  
• Caring for vulnerable adults (the elderly, disabled, & seriously ill)
  
• Building & maintaining roads & cycleways
  
• Collecting rubbish from homes & businesses, recycling it, & managing waste sites
  
• Building & running libraries & community centres
  
• Registering births, deaths, & marriages
  
• Managing (some) green open spaces
  
• CCTV & community safety
  
• Electoral services
  
• Implementing trading standards & investigating fraud
  
• Providing advice on planning policy & planning applications
  
• Archaeology & conservation of the historic environment
  
• Prevention & response to surface water flooding
  
• Pest control & animal welfare
  
• Management of public rights of way
  
• Planning the future need for all the services listed above

Many county councils also do the following:

• Support economic development in the local area
  
• Encourage more sustainable living by promoting recycling, non-car travel, etc
  
• Regeneration projects

The variety and complexity of these services, and their interdependencies with services provided at district level, have resulted in county councils employing many thousands of people. Suffolk's decision to divide all these services up into packages and outsource them in three phases is (to borrow a phrase from Sir Humphery Appleby) brave. Given the overriding need for 30% budget cuts, some outsourcing is inevitable. There are areas of duplication that could be cut, nice-to-have projects that are no longer affordable, and great potential for pooling resources with other public sector organisations (sharing HR and admin functions with other councils, for example).

What Suffolk is proposing is an order of magnitude more ambitious than that. It has decided to entirely divest itself of all services within the next two years. It would be amazing if that timeframe is even legally possible. I strongly feel that the council should proceed more slowly, first piloting the outsourcing scheme with smaller and less risky services. Contracts will need to be negotiated very thoroughly, be open to public view (this is definitely not current practise), and include clear penalties for inadequate quality of service.

Suffolk's report into their 'New Strategic Direction' suggests that outsourcing everything will strengthen local democracy, make services more responsive, and give communities more capacity to take control of their lives. All three claims look dubious to me. The report talks of councillors providing strategic direction, but in reality once contracts with companies are signed, they will have no further influence. Unless the intention is continual contractual review and renegotiation (time-consuming, inefficient, & wouldn't address the public-private legal expertise imbalance), for years at a time local councillors would have no grounds to interfere with the way services are managed. I've never met a local councillor who would be satisfied with that. In fact, I think most would be apoplectic.

Moreover, there are some services that I'd be uncomfortable with outsourcing as a matter of principle. The protection of abused children and vulnerable adults should not be something that companies profit from, there is too much of a moral hazard at stake. Company law states that private companies have a duty to maximise returns for their shareholders; this duty is not overriden by the moral imperative to protect children and adults at risk.

Suffolk County Council are to be commended for taking the Big Society to its logical conclusion, and thus focussing the debate about what local authority cuts will really mean. Reading their report, though, makes it clear that the full implications of outsourcing have not been considered. Local Councillors don't seem to get that they are making themselves impotent and irrelevant, as well as ridding themselves of the people who set up their meetings, write papers, type up minutes, and make them coffee. I presume that in the fullness of time they will start doing these tasks themselves, before eventually realising that their jobs have become pointless. Whereupon they will outsource themselves to a local newspaper columnist, and the privatisation of Suffolk County Council will be complete. According to their timetable, this can be expected in September 2012.

For further comment on the Suffolk experiment try the Guardian, BBC and East Anglian Daily Times.

EDITED TO ADD I've just found a very interesting blog post on this by Flip Chart Fairy Tales.

Ill Fares The Land

In George Orwell's 1984, Winston is given a book:

'[It] fascinated him, or more exactly it reassured him. In a sense it told him nothing that was new, but that was part of the attraction. It said what he would have said, if it had been possible for him to set his scattered thoughts in order. It was the product of a mind similar to his own, but enormously more powerful, more systematic, less fear-ridden. The best books, he perceived, are those that tell you what you know already.'

Last night I finished reading exactly such a book, Ill Fares The Land by Tony Judt. It challenges the largely unspoken assumptions that have dominated economic policy in the Western world since the 1980s. The book brought some thoughts that have been nagging at me into focus. So rather than getting a reasonable amount of sleep last night, I wrote a political diatribe. It isn't polished or structured, but it's a sincere response to that remarkable book.


Why have we stopped imagining any alternative to free market capitalism? This is a question I've long wondered about, now re-awoken in my head. The simplistic communism/unfettered free-market capitalism diochotomy is frankly stupid. Surely humanity can manage more sophisticated thinking? Why haven't the interdependencies between markets and governments been acknowledged and studied?

How did the economic growth become an end in itself rather than a means to an end?

Have we forgotten the original purpose of government and the public sector?

Why are we as a society willing to tolerate huge and growing inequalities? High unemployment? Social exclusion and poverty? All in the name of economic growth and the ubiquitous totem of efficiency.

Why do we now value efficiency above everything else, without even knowing what it means?

Why can't the wealthiest countries in the world afford basic public services any more?

The coalition government are trying to dismantle the state, whilst telling us that we don't need it. If that is indeed the case, why has it persisted in being useful for hundreds of years? Why did our estimation of its value suddenly plummet in the 1980s?

Where has our faith in markets come from? Unregulated markets are as unsuccessful as over-regulated ones, just in a different way. Monopolistic exploitation vs so-called inefficiency - which do you prefer?

Economics has become akin to a religious mystery, with a priesthood of bankers telling us its too complex for us to understand or be included in. That's a lie. The basis of economics, the laws of supply and demand and the concept of markets, are very simple. Deceptively so, as they fail to reflect the ways that human beings, and the institutions and markets in which they interact, actually behave. I remember being taught about models of long term economic growth about six years ago and realising, with some amazement, that none of them stood up to scrutiny. They all made assumptions that are utterly ridiculous - infinite capital, for example. Yet we continue to put our faith in these models, because no-one has stood up and said, 'BUT THAT'S JUST NOT TRUE!' No-one does that because they're afraid of being told, 'Oh, you just aren't clever enough to understand.' (I tried to discredit these models in an undergraduate essay, but that was never going to shake the world to its foundations.)

The goal of a government should not be to promote economic growth above all else. Governments exist to protect their citizens, to create an environment of fairness, justice and equity for all. We are not dismissive of governments because these concepts are no longer relevant in the twenty-first century, but because governments appear to have lost faith in them. All debates on fairness are framed in purely economic terms, as if the only freedom anyone needs is the ability to make as much money as they can.

Public sector workers are increasingly being demonised as meddling, obstructive bureaucrats. At times I have felt guilty that I am paid by the public purse, because my job isn't absolutely essential to the continued functioning of the UK. Now I think, why the hell should I apologise? I do my job to make the world a better place, insofar as I can. The aim of it is to improve life in Cambridgeshire, by planning for the population's future needs now. Why are workers in the private sector being painted as morally superior, for working merely to enrich themselves and the shareholders in their companies? What is wasteful about working to improve the environment and people's lives? How did we as a society get to the point where a public servant is a drain on the country rather than an asset to it?

Why does this feel like a radical thing to question? Because at the moment it is. We have a cabinet minister who fears 'cigar chomping commies', a Prime Minister who thinks the state should retract and let mythical communities provide their own public services. The NHS and education systems are about to be dismantled. Government support in every single sector of society that you can imagine is being scaled back or withdrawn. The overriding goal of this government is to cut public spending, whatever the human cost.

At the moment, I think people feel a mixture of three emotions about this:

1. Ignorance ('none of this will effect me')
   
   
2. Vague satisfaction ('ha, those wasteful bureaucrats deserve a bit of a shock; after the recession we've had in the private sector, it's their turn to feel some pain')
   
   
3. Vague fear & unsettlement ('there are a lot of changes happening suddenly, I don't remember voting for this')

To 1, oh yes it will.

To 2, when the private sector suffers, private sector employees feel it. When the public sector suffers, everyone feels it. Because everyone uses public services, however much they unknowingly take them for granted.

To 3, now you're actually thinking.

I refuse to apologise for so-called bureaucratic wastefulness any longer. Why is it so much more reprehensible for the public sector to allegedly waste a little than the private sector to waste a lot? Which is better value to society - thousands of people employed doing so-called 'bureaucratic non-jobs' or a vast handout to a bank? The former do not meet economic definitions of efficiency, and their value cannot necessarily be quantified. But that does not mean that they're valueless and less justifiable than bailing out a huge private bank, which will then confirm its commitment to inequality by paying billions in bonuses whilst refusing to lend to small businesses.

The public sector has been on the defensive for thirty years, since it became the norm to measure success in purely economic terms. That is a stupid, wrong-headed way to assess whether services like a rail network, health centre, or environmental protection agency are operating well. We must learn to measure beyond money. There are many things too important to try and quantify so simplistically; health, education, and the environment, for example.

I do not think that the public sector is perfect and the private sector evil, just because I refute the notion that the public sector is always wrong. We need a more intelligent and nuanced view of both sectors, and of their interdependence.

Tony Judt ends with an entreaty that if you agree with him that something has gone very wrong with how we are governed, do something about it. He doesn't specify what, because that's a much harder question. Nonetheless, I feel galvanised and somehow vindicated. It's very frustrating to disagree with so many government policies, dissecting each into tiny pieces so as to describe how they are goes wrong. All current policies start from flawed economic and political assumptions, assumptions that have become so widely accepted since the 1980s that we have almost forgotten how to contradict them. We criticise high train fares, fear the threat of unemployment, feel vaguely guilty about our inefficiencies, and aspire vaguely to wealth as it is is supposed to make us happy. So little in culture or media contradicts this.

My generation needs to read Ill Fares The Land, it's well worth losing sleep over. We need to be reminded that a better world is possible, and that better is not a synonym for richer.

There is no profit in trying to build utopia. Attempting to make the world better for people requires thinking beyond market transactions, it demands imagination of a kind that modern life seems to suppress. The UK is at a turning point, with an anti-government government telling us to go away and govern ourselves. Perhaps this is a chance for our imaginations to awaken, for us to recognise what we really want from the state, and most importantly for us to challenge the notion that human beings exist to produce products and services more efficiently. That is what our economy and our political system are based on.

Does anyone really believe that to be true? Do you?