Examination of Witnesses (Questions 240
- 254)
THURSDAY 15 NOVEMBER 2001
DIGBY JONES,
AMANDA MCINTYRE
AND CHARLES
COX
Chairman
240. Is that not precisely the public service
ethos point and the problems with a contract culture that people
will only do the contract? If you have a public servant, they
will keep those loos clean—
(Mr Jones) No.
241. —if they are informed by a public
service ethos that tells them to keep those loos clean and not
to live within the boundaries of a narrow contract.
(Mr Jones) No; I disagree.
(Mr Cox) I have thousands of people spending their
time day in day out challenging back, doing things they have not
been asked to do, because they know if they do not, it will be
a problem for everybody down stream, then having a very difficult
contractual battle afterwards, saying they really had to do this
and they did it and they did it successfully and they did it over
the service level, but they do think they should be paid for it
as well. You would be surprised, truthfully you would be surprised,
by the extra three miles people will go because they believe in
what they are doing, because they believe in the outcome. This
is about good service. There is no difference and you will see
it in the best private sector employees in the private sector
and indeed the best public sector employees in the best public
sector. It happens when the two overlap as well. It is about good
management, it is about caring about what you do and people do.
The truth is that people do.
(Mr Jones) Incidentally, when I followed this through
I spoke to two or three members who are major contractors in the
public service and they said in that situation they would not
take the contract today. They would have said to the contractor
that they were asking for the wrong thing and they would not tender
on that basis. Five years ago they probably would have done. We
are all learning here. The private sector is learning here and
so is the public sector.
242. Five years ago the CBI was not telling
us about the deficiencies of CCT was it?
(Mr Jones) No. We are all learning here.
Annette Brooke
243. May I quickly say that I have a local authority
background and have done quite a lot of work on best value, but
it all depends on your definition of best value, does it not,
how much public sector ethos you build into it? That is the great
danger with the narrowness of contracts when there are instructions
to prune the costs and then the contracts are badly specified
and the people who are perhaps being maligned here, the democratically
elected people actually have to sort out the problems from badly
defined contracts.
(Mr Jones) Why do the democratically elected people
have to do that?
244. Certainly in a local authority situation.
(Mr Jones) Why is it your responsibility?
245. In a local authority situation if the grass
is not getting cut then the comeback is on the elected representatives
and we can take that right across the public sector.
(Mr Jones) I do not agree. That is the same as Alan
Milburn taking responsibility for these bodies in a cellar. It
is not. It is about the Chief Executive, it is about the paid
managers' responsibility, not—
Brian White
246. The Chief Executive does not face the electorate.
(Mr Jones) You are absolutely right but that is the
political equation.
Chairman
247. Who resigned in that instance? It was not
a Minister, was it?
(Mr Jones) No.
248. It was the Chief Executive, was it not?
(Mr Jones) I think so; I think you are right.
Annette Brooke
249. In terms of best value you might want some
extra social achievements within something and that is going to
be built within best value.
(Mr Cox) It is very interesting. We look at this best
value equation in terms of looking at a contract. What is a contract?
It specifies some of the things which we think you ought to do,
how much we think it ought to cost, to what service levels we
think you ought to do it. One of the issues which has come out
through this is that you know these things when you are in such
a regime. It does not mean that the same logic and the same analysis
and the same drivers should not, and on the best occasions do,
apply in the public sector. One of the things I have found time
and time again, when you go into the contracting situation, is
that people do not know what the unit cost of production is and
they do not know whether they are getting value for money and
they do not know how long it should take. They are accepting levels
of service within public service which are appalling, not because
there is some wilful intent to do it badly, but because there
is just no datum. It is actually through the contracting process—I
cannot say this absolutely categorically but in my own experience—that
this information is derived and virtually all contracts specify
a higher level of service which is required in the future than
has been experienced up to that date. I think some serious questions
need to be asked about looking at best value full stop, irrespective
of whether it is in the public sector, private sector or at the
intersection.
Chairman
250. Are there any no-go areas?
(Mr Jones) Yes. You are then going to ask for an example
of one or two. Trial and error is part of the way we are going
to get there and I shall give you one example. If you are always
going to operate in a completely monopolistic environment by definition,
as opposed to by choice, and the only way you are going to deliver
any form of quasi-competitive pressure is through a regulator
and not through market pressure of any sort, then at the end of
the day it would be very difficult to bring a private sector culture
change into that environment. I can think of one or two examples
there, which if we had time we might just explore. If there are
no-go areas per se, every single area of public sector
and public services deserves rigorous investigation as to whether
PPP would work. We would find when we did it that there would
be two or three where it would not work and I can think of one
where maybe you might tell me it already has not worked.
(Ms McIntyre) This is a dynamic thing. At any point
in time there may be a no-go area because the risks are very political
and therefore not easily managed by the private sector or there
is no private sector capacity, there is no market. The analysis
of that situation changes over time. So 15 years ago there was
no market in prisons. The risks were seen to be political. On
mainland UK the risks now are managerial and there is a genuine
market and PFI prisons are doing very well. You would not dream
of trying for a PPP or PFI prison in Northern Ireland where I
would say the risks are still political. The private sector would
not want to take on those risks. In 15 years' time it could be
different.
Brian White
251. Is it a two-way process?
(Ms McIntyre) Yes.
252. If something is in the private sector now,
is there any reason why it should not go back into public sector
provision in the future.
(Ms McIntyre) No.
(Mr Jones) No. By answering no, I mean there is no
reason why it should not. In other words, the competitive element
and the best practice and benchmarking aspect which I sincerely
hope will be brought into it, would be very encouraging if we
found in many areas over 10 to 15 years that there were public
sector employees delivering a better service than the private
sector. What would be wrong with that? That is what I call partnership.
253. And the voluntary sector as well?
(Ms McIntyre) Yes.
(Mr Jones) I used to chair a hospice so I feel very
strongly about how the voluntary sector could bring more into
public services. I believe the whole voluntary sector—we
have no time but I could spend a long time on this—could
add value that comes from a completely different fundamental approach.
They have a lot to add.
Chairman
254. Thank you very much indeed. One of the
certain things is that there is a far more intelligent conversation
going on about these issues now than there was some time ago.
You are an important contributor to that conversation and we are
very glad to have had you along. We are grateful for your time.
(Mr Jones) Thank you for your time. I have never ever
done this before today. It is my first ever. I was not going to
tell you that at the start.
Chairman: Had we known that we would really
have given you a hard time.
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