Select Committee on Public Administration Minutes of Evidence

Examination of Witnesses (Questions 480-493)



  480. So, you take an authority like my own, Milton Keynes, and just choose one department, which is the learning and development department, when it inherited children's social services from Buckinghamshire it was probably the worst in the country, and over four years they have turned it into one of the best. But, at the same time, because they concentrated on that, they took their eye off some of the education provisions, so they did not improve those education provisions that they had taken up. So how do you judge, where it has got very good youth provision, very good children's social services, and quite poor education provision, in the same department?
  (Professor Stoker) In a way, the question hits on a dilemma that we face, which is, quite frankly, we should not be sitting round here making a judgement about Milton Keynes, the people of Milton Keynes should be making a judgement about Milton Keynes. And one of the problems we have got in our political system is that the level of local political accountability is not as strong as it should be, which is why we have seen this enormous growth of inspections and audits, and so on and so forth. My feeling is that I would like to see the system go in a way that we streamline dramatically the amount of inspection and audit and oversight of public organisations and make it a more streamlined inspection service, but we then also, much more than we do at the moment, promote information to the public about what levels of public service standard their institutions are providing. And then, quite honestly, it would be, as far as I am concerned, a local political debate about whether the priority that they gave to social services was the right priority, whether now they have got plans in place to deal with any tailback they have got on education. But it seems to me that the whole thing has got crazy, we think all of these decisions have to be made by somebody in Westminster and Whitehall; we want to drive a system back so that the choice rests with people in Milton Keynes.

  481. So the Public Service Agreements that have been signed, are they a good or a bad thing, and how do they determine the level of public service, do you think?
  (Mr Williams) I think the jury is certainly out on the effectiveness of Public Service Agreements. What I think it has given is the Treasury and Government at large is a greater, a more enhanced performance management tool across Government Departments and through local government as well. But you have got to ask yourself the extent to which the public is involved in the debate about local Public Service Agreements; from what I have seen so far, the public are very rarely involved in those conversations, what takes place is a civil servant to chief executive conversation in local government. So they might be effective, as a useful performance management tool, but I do not think they generate any greater accountability or involvement of the public, in particular, in service delivery.

  482. You talked about management and about delivery of service; is not one of the reasons that we get poor public service management that people take the safe option, they are scared of the Public Accounts Committee, they are scared of the National Audit Office, and, therefore, it used to be true, when I was working in computers, that buying IBM you did not get sacked for it, and that people take the safe option rather than the right option, in public services, and that is part of the problem?
  (Mr Williams) I think you are absolutely right, in that if you do not get it 100 per cent right in the public sector you are come down on very heavily. In the private sector, in the good elements of the private sector, people are supported when things do not always work out well, and people are expected to try to experiment with new things; but, at the same time as well, there is a bit of a fallacy that the private sector goes around taking risks all the time, willy-nilly, it does not really care about this, and the public sector just do not take risks. I think what the private sector does, and some of the skills that it might be able to help bring to public service delivery is that they are better at managing and assessing risk and they are more careful with the management and assessment of risk than parts of the public sector.

  483. I tend to disagree with that, I spent a very good living telling private companies where they were getting their management wrong. Can I just take you on; we talked very much about the individual contracts, what about the longer-term social and political consequences of taking decisions on individual services? I will give you an example. British Gas, when they became privatised, stopped training gas engineers, which means that a whole lot of gas engineers are going to retire over the next five to ten years and we are going to have a crisis of a lack of gas engineers in the country; because, when it was in the public service, that training was considered part of the social contract, the private company did not see it as part of the social contract. So how do you actually deal with those longer-term consequences?
  (Professor Stoker) The trouble is that, if we are going to have a competition between who takes long-term interests into account better, the public or the private sector, I think it would be a very embarrassing competition for both of them really, because, just as all of us are perhaps aware of your example, we are equally aware of the example within the NHS, one of our problems at the moment is a shortage of both trained doctors and nurses. If you think about some of the long-term consequences of underinvestment in infrastructure taken by public sector, indeed, politicians, of all the parties, then you could argue that that has had a detrimental effect. I do not think that, in that particular measuring yardstick, anyone comes out particularly well, I think that there is an enormous pressure on almost everyone to think short term rather than long term.

  484. But the point I was trying to get at is that the current models, including the ones that you are suggesting, still only look at individual contracts, they do not take the wider consequences into account; now how do you do that in the new models that you are putting forward?
  (Professor Stoker) I think that, in a way, you are partly right but you are partly wrong, because I think the current model within local government, which is the Best Value regime, means that you can take into account, I think, much broader issues than simple establishment of one contract, and, indeed, can develop both a long-term strategic partnership with elements of the private sector and, at the same time, develop a long-term set of aspirations and commitments, in terms of what you are trying to achieve overall within your community. So I think that the constraints that you are talking about were constraints under the previous compulsory competitive tendering legislation, which, to a large extent, in the local government world, have been overcome by the introduction of a much more flexible, and I think much more worthwhile, Best Value regime.
  (Mr Williams) Could I just provide one specific example. I do not know whether you are aware of the partnership that has been formed between Middlesbrough Borough Council and Hyder Business Services; what is interesting about that partnership is that there is a mixture of objectives that the Council had, but all underpinned, interestingly, by its attempt to fit into the regeneration strategy of Middlesbrough, as a town. That, actually, when you talk to the politicians and you talk to the senior managers there, is the overarching objective of that partnership for the generation of 1,000 new jobs in Middlesbrough, the investment of £20 million in a derelict council building; those other objectives are being met within the terms of that agreement with the private sector. I think that is one practical example where the two things can come together.

Mr Wright

  485. Just really on the public sector ethos. What motivates somebody to work in the public sector is something different from what motivates a private company to want to bid for a public sector contract, for instance; would you not agree with that?
  (Mr Williams) The example that we gave in our evidence was, look at the market that has developed in education, education support services, LEAs, in the last couple of years. Recently, there has been a large number of senior managers from the public sector who have moved across to the private sector. I do not believe that they are motivated with a certain set of goals and aspirations on day one, and lose all of those motivations, those goals and aspirations, and are motivated by something completely different when they join the private sector organisation. That just does not stand up to any scrutiny when you actually talk to these people. Why have they decided to join the private sector organisation? Well, I think, as we said in the evidence, perhaps what they do have is a real vision of how educational attainment should be pursued, and they use the leverage of that organisation to be able to project and deliver their vision across a wider platform. But I do not think they are motivated on day one by something, and then day two by something completely different.

  486. That is an example of somebody that works in the public sector moving across to the private sector, doing a similar job. I am talking about a private sector company that comes in and takes over a contract, with private sector employees, on the basis of the public service ethos?
  (Professor Stoker) First of all, how they are motivated, to some extent, depends on how the contract is set up. So if the contract is aimed at trying to save the most amount of money then, oddly, they are going to be motivated by the commitment to saving money. But this is the great virtue of the Best Value regime, it has got us out of that impasse, where the only way we could bring the private sector in is by telling them to do it cheap; we now can have a real conversation with the private sector, or any other sector, for that matter, and say, "this is what we want in terms of outcomes, this is what we want in terms of performance, and this is what we are going to hold you to account for, in terms of our management systems." Their motivation then is achieving those outcomes and performances, because unless they do that they are not going to get paid and they are not going to stand any chance of having their contract renewed in the future. So the motivation is driven by what we, sorry, you, as politicians, tell them you want out of publicly-funded services.

  487. This is where the difference lies, because, just to quote a very quick example, okay, it is going back to compulsory competitive tendering, which is completely different from the Best Value, and I accept that, but it is the gardening service goes out from the local authority's control into a private company, the day that it was in the public service's control the gardener may well do extra service, he might cut the elderly person's branch that is tapping against the window; the following day, in the private sector, the employee says, "sorry, I can't do that because it's not in the detail." Now you would not expect the people who procure that particular contract to put all of those details in. What I am talking about, the public service ethos, is that that employee, under the public service, would say, "yes, I will do those little jobs, those little bits and pieces," which you can put in there; and this is all about the public's perception of where the public sector comes in?
  (Professor Stoker) Can I just counter with an anecdote of my own, provided to me by somebody who shared a platform with me, from the Transport & General Workers' Union, from Liverpool, and he was saying that one of the things that finally made him think that perhaps public sector provision was not always entirely what it was cracked up to be was when he watched a documentary done on the way in which municipal workers operated in Liverpool, this was about 20 years ago, and there was a particular picture of somebody clearing up litter, and their job was to clear up litter on the street, and the commentator came up and pointed out an amount of litter on the grass over there, and they said, "no, that's not my litter, that's somebody else's litter, that they've got to clear up." So I am afraid that if you have poor management and you set contracts which are inappropriate you will get that sort of daft, inappropriate behaviour, whether somebody is working in the public sector or working in the private sector. The reality is that it is a question of political and managerial leadership. Politicians have got to be clear what it is that they want in terms of outcomes and they have got to make it clear that if they said "do it cheaply" people will do it cheaply, but if they are prepared to bite the bullet and point out to the public that if they want a quality service they have got to pay for it, then I think you can then get the managerial leadership, whether it is in the public or the private sector, to actually deliver that.

  488. So do you think Best Value is the way forward then?
  (Professor Stoker) I think that Best Value, in practice, needs some tweaking, that is, I think it is subject to a too intense oversight and inspection, but, I think, as a fundamental rationale for procuring services, yes, I think it captures, for me, the essence of the way in which I would like the procurers of services to make decisions, which would ask them to reflect on (a) whether the service was needed, and (b), if it is needed, who out there can provide that service best, is it the in-house staff, or is it others. That, for me, captures the essence of the argument.


  489. Just on Tony's previous question there, Jack Dromey told us about, I think he said, going the extra mile was something that distinguished public service, and we discussed whether that was, in fact, true; but, assuming that it is a constituent, and it is Tony's question about doing more than you have to, surely, there is a conflict there between that and a contractual service, because contracts do not say, as the final clause, "and go the extra mile"? Although you can point to examples in both the public and the private sector where people do not do what they should, is there not still a difficulty here though, because you are saying to public servants, who are infused with these values, "you should go the extra mile," but a private contractor will not have "go the extra mile" in their contract, and nor would you, if you were a contracted provider?
  (Mr Williams) Can I give you a specific example, to challenge that. If you look at, again, the partnership between Islington and CEA, there was a real commitment from both the Council and the private sector contractor to make that partnership work, and one of the things that happened a few weeks back was that the private sector contractor decided to set up an afternoon music club on a Saturday. It had not been asked to do it, it was not in the contract, it was not specified, it might be your definition of going the extra mile, they had done that voluntarily. I think the main reason why they have done it is because they wanted to do whatever it took to deliver children with well-rounded education, because those were the outcomes that they were going to be judged by at the end of the contract life. And it was not about specifying that they had to go and set up this music club, they decided to do it. But I think it came out of a very different type of relationship between the public and the private sector that existed in that specific contract and a real maturity of the relationship, compared with CCT days and a very adversarial bottom line, "we'll come and monitor what you're doing, we're ticking these boxes, if you don't do it we're going to penalise you." I just think there has been a real sophistication in local government of the relationship between the public and the private sector, and that is just one tiny example of where a contractor will go the extra mile.

Annette Brooke

  490. I have to declare that I am a councillor of a unitary authority. I wanted to pick up on something which has rather run through this morning, and that is this element of choice. Up to this point, we have been led to believe, by rather a lot of the people who have come to speak to us, that it is really all about providing more choice, but, picking up on my colleague's, over there, point about market failure, this morning I have really been feeling very unsettled about equity and how we actually reconcile fairness and equality of receiving the services, if you are actually providing choice. Because the bottom line is that people's incomes are different, their ability to travel is different; how can we have choice in the National Health Service and have equity? It is not like the supermarket, it just is not. And, equally, with your school choice; some people have got a choice of school, but there are perhaps 30 per cent of parents who have not got a choice, in reality. How do you square this circle and put equity in it as well?
  (Professor Stoker) I think it is very difficult. I think that, if we accept the distinction that the Chairman made before about choice, in relation to who produces the service, but you are talking about choice in relation to the consumption of the service.

  491. I am.
  (Professor Stoker) I think that there are issues of balance there. But I think that we can go further than we have gone, in terms of operating greater choice at the point of consumption than we have, and still maintain a broad commitment to publicly-funded services available to all on the basis of need, I think we can do that. I think the fact we do not always do it perfectly is not an argument against it. I think that most of us would value that commitment to fairness and equity but we would also value a commitment to individual choice and personalisation of services as well. So if you are dealing with an elderly person, you do not necessarily want that elderly person just to receive a set range of services, you want them to receive services that are tailored and packaged to their particular needs. So it seems to me that, in achieving the aspirations that we have for public services, we have to find a way of balancing out that, I think, very reasonable commitment to equity and fairness with a commitment to allowing some options for choice and the tailoring of services to meet the needs of individuals.

  492. Would you accept that there is a real danger that we could lose sight of equity in this whole debate?
  (Professor Stoker) I think there would be, if we were not very, very strongly committed to providing taxpayers' funding and money to those services.


  493. As we end, let me just ask you one absurdly big question and ask for an absurdly short answer, and this goes to the heart of what you are, as an organisation and also what you said a little while ago about the core problems of local government. In a nutshell, the question is that, is not the game up for local government? People are walking away from it in droves, 29 per cent turnout, people just disengage from local government on a massive scale, all your kind of ruses to get them engaged again are not working, the whole thing is falling apart, why not just admit that the game is up; people do not know where services come from any more, they do not care where services come from any more; why not wrap the whole show up, have a local prefect system and just get on with it?
  (Mr Williams) If we believed that the authorities' core function was the delivery of services, then I will probably agree with you, but we have been arguing very strongly, over the last two or three years, that an authority has to think about many more things than just being a deliverer of a service. It is about, particularly in a global world, providing a sense of identity, security, space for people. In a global world, locality is actually even more important than it has ever been, and I think we have got to work incredibly hard to reconnect people with the political institutions if we still believe that politics at the local level and at the national level is really important for making choices, for rationing resources, and I still believe that it is. The ruses that we have tried, some of them are only just about to come into effect, so, for example, we have been really strong advocates of the proposal to introduce directly-elected mayors in local government, and I think they will have a significant impact in not just reconnecting people with local government but also rebalancing where power lies in England, in particular, a recasting of the balance between Whitehall and local communities.
  (Professor Stoker) Can I just quickly add, Tony, I admit, freely, that, occasionally, in my darkest moments, I go along with your scenario. Two things stop me doing it; thinking of a world run entirely by Westminster and Whitehall, so that is even more of a nightmare than the current system as operating, and the second is that it simply cannot be that it is unachievable. Because, if you look around huge parts of other western democracies in Europe and in North America and Australia, it seems that they find perfect space within an overall multi-level system of governance, real opportunities for local councils to make decisions, and indeed reflect real local choices and be connected to their local communities. So I think what keeps me going is a feeling that if others can do it then, ultimately, we can persuade people in Britain to do it as well.

  Chairman: It would be lovely to have you back and talk more about all that, I think that goes to the heart of it; probably we shall do that. But, for the moment, thank you very much indeed for this morning and what you have said to us. Thank you very much.

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