Employee-led mutuals: should the public services white paper have gone further?

By David Bicknell

Some commentators believe that the Government could and should have gone further with the publication of the Open Public Services White Paper.

Writing in the Guardian, Colin Cram, the former chief executive of the North West Centre of Excellence, makes some constructive suggestions. He argues that publishing the white paper is “a bold step. It is an attempt to create a coherent and different approach to providing public services. My feeling is that the consultation will be genuine, which will provide an opportunity for criticisms to be addressed and the government to back off from impracticable ideas or change its approach. The risks for the government are that the rhetoric looks likely to exceed the scale of delivery and it could be easy for the parliamentary opposition and the electorate to hold it to account.

Under the sub-heading ‘Making a Change’, Cram makes the following points:

“The white paper places much emphasis on consultation and facilitating change rather than directing. A weakness is that many proposals are projects or programmes and should be subject to the established public sector controls such as “starting gate” and “gateway”. These are not bureaucratic, help identify what should not go ahead, whether the necessary success factors are in place at each stage of the project and whether there need to be changes. These robust approaches save time and money and greatly increase chances of success. The white paper should have provided assurance about applying these disciplines.

“The paper argues that the public sector should be a commissioner of services rather than a provider, yet appears to run out of ideas on where this might operate, focusing mainly on social care and to a lesser degree the hackneyed “back office services”. The government is attracted by employee-led mutuals, but suggests that these will be created voluntarily.

“The potential contribution of the private sector to the diversity of service providers is scarcely mentioned. Lib Dems 3, Conservatives 0? However, local government will increasingly outsource front and back-office services, and we can expect the NHS to continue to do so.”

“Critics might argue that the white paper represents little more than bringing together government policy announcements in a coherent form: health and wellbeing boards, strengthening the powers of local government over the NHS, removing excessive monitoring and oversight by central government, community budgets and retention of business rates. However, it does provide a narrative and context.”

“Absent from the paper is how one might manage the anticipated increasing diversity of service providers. The wider public sector has not been good at this, hence the Southern Cross debacle. Integrated commercial management of markets and suppliers throughout the public sector is vital.

“New commercial models include incentivising suppliers to deliver successful outcomes and assigning the risk to them, though I would question whether payments to suppliers under the work programme will be “based primarily on the results they achieve” unless the bar is set very low. Risk sharing would rule out many social enterprises.”


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