One week in February held the publication of two different think tank reports, with two very different visions of the future for the sector and interesting to compare their takes on how we should be adapting our systems to meet future demands.
The first report is “Spending fairly, spending well: time for a radical overhaul of value for money and public audit”, published by the Smith Institute and authored by David Walker and John Tizard. These are names many of you will know, for good reason – David was a senior journalist before becoming Managing Director (and latterly Director of Communications) at the Audit Commission. He continues to be regularly published and holds a slew of senior Board roles. John, meanwhile, was for many years a councillor, council leader, held senior roles at Capita throughout the 00s and has been a successful writer, consultant and passionate advocate for public service since then.
The second report is “The community paradigm: why public services need radical change and how it can be achieved”, published by the New Local Government Network and authored by Adam Lent and Jessica Studdert. NLGN is a think tank (and membership body) which has a deserved reputation, especially in recent years, for searching and high-level work on the future of the sector.
These two reports present rather different visions of accountability in the sector (although I should add the caveat that the focus for Walker and Tizard’s work is accountability in central Government).
For Walker and Tizard, there is an urgent need to strengthen national systems of oversight and accountability. They frame this around a renewed focus on “value for money” in public services; the removal of VfM oversight responsibility from the National Audit Office (where it has sat since VfM became a feature of Government’s work in 1983) and its positioning in a new “Office of the Three Es” – a body looking not unlike the Audit Commission, with a remit to look at equity, efficiency and effectiveness across both central and local government. With this role, the NAO would be able to adopt a focus on the quality of public audit, a role which Walker and Tizard feel to have been neglected in recent years.
This is a structural solution which Walker and Tizard conceive in mainly structural terms – essentially, that VfM cannot be assured under the current system because responsibility for its oversight is confused and “gappy”. Having a single organisation to take responsibility for all of this, for them, makes sense because it applies a sense of consistency and transparency to the system.
Tizard and Walker see the Office of the Three Es working in concert with actors at local level. They highlight our own idea of local Public Accounts Committees, saying that these committees would be a natural partner for the new Office, passing through information to.
It is a solution which appears to have clear roots back to the politics of “new public management” – the philosophy of Government which was born in the early 1980s and which, arguably, died in 2010. With a philosophy of KPIs and balanced scorecards, of “programme management” and other systems which give managers confidence that they can operate in a predictable, understandable system. In short, it is a model where the phrase “value for money” is framed through the viewpoint of professionals.
For many this approach still holds sway, is appealing in times of uncertainty when the focus is on managing cuts whilst continuing to protect the impact on citizens and communities. But is this the approach that we need for a world that has changed so dramatically over the last ten years, in every aspect.
Lent and Studdert’s vision of the future could really not be more different. It says that the history of public services lies in shifts between different “paradigms” in terms of how people think and act – most recently, the prevalence of a “market paradigm”, the notion of public services as transactions between the state as provider, and the public as consumer. This is the mindset that birthed “new public management” – value for money is arguably about making “marketisation” easier and more efficient by having a common framework for understanding how services are delivered. The requirements for governance, and scrutiny, under that paradigm naturally reflect Walker and Tizard’s sense of what’s needed – essentially the collection and collation of more, and better, data so as to allow for more robust oversight and better management decision-making. It is a model which says that value will look the same across the country.
Now, Lent and Studdert see us moving to a new paradigm – what they term the community paradigm. This new paradigm recognises the public demand for increasing influence in a world of rising demand for public services. It is about participation, and producing new models for local people, their representatives, professionals and others to collaborate to deliver the change that people need.
This has profound implications for government. Our old systems, created for a marketised world, are implicitly based on the sense that there is a “single version of the truth” – a universal conception of value that we can use to reach straightforward, clear, unambiguous and understandable judgements about equity, efficiency and effectiveness. Governance under these circumstances is straightforward. We can review scorecards and how they are put together – we can review other management information and the data that sits behind it. We can assign and assert responsibility in key places in the management chain for delivering high performance under these systems. And yes, under those systems we can have strong national oversight systems – because this consistency means that comparison across the country is not only possible, it is desirable in the interest of checking adherence to national standards.
Governance in Lent and Studdert’s community paradigm is messier. It is about collaboration – a multiplicity of different partners coming together, recognising that everyone’s sense of what “value” looks like will be different, recognising those differences and seeing how we can work together to better understand those needs, and to act on them. Under this model, national systems of oversight are essentially meaningless, because value is defined entirely locally. Governance, too, is wholly local.
The policy drivers
For Lent and Studdert the community paradigm demands the following policy decisions:
- Unconditional devolution, with powers over revenue and budgets being passed to local communities following on from this. This is a natural prerequisite to the other policy decisions set out below.
- Participatory decision-making. There has been a lot about the benefits of citizen’s assemblies in the press recently; Lent and Studdert’s work provides an opportunity to place that in a rounded intellectual framework. Shifting decision-making to a wider range of people – whether through assemblies or other means – requires us to think differently about how gets held to account when things do and don’t get done in the way that we expect;
- Collaborative delivery. This is about different agencies and individuals working together to deliver. Alignment of priorities and work programmes at local level have been a feature of public services for some time but this feels more fundamental – something that requires a knitting together of accountability at local level. This is how we frame the opportunity around local Public Accounts Committees;
- Community commissioning. Giving budgets and responsibilities to commission directly to service users means placing those decisions in the hands of those who understand their needs best – but it also raises challenges around governance. On what basis do decisions get made? Who is involved, why and when?
All four of these big policy moves raise challenges and opportunities for governance. One thing is certain – if this is the way things are going, trying to apply our traditional models of governance to this new world is likely to result in failure. Local democracy and the relationship between local people and the public bodies who work to fulfil their needs is likely to shift, and significantly.
Culture and mindset
This all hinges on a change in culture and mindset. Of course, we and others talk about culture seemingly endlessly (on which point, we will be publishing something on political culture in local government in the coming weeks). But this is because it is important. Changing structures only takes us halfway – we have to change how people operating within those structures think, act and behave. The same goes for the four policies we outline above.
Our own work on intervention (“Decline and fall”, published with Localis in December 2018) highlights the need both for an improvement in the way that we understand the risk of failure in the sector, and also the oversight of those arrangements by central Government. But for us that has to be sit in the context of strengthened accountability arrangements at local level – ones that are bolstered by local democracy and local people taking having control of the things that are important to them.
It is easy to be drawn and attracted to the Lent and Studdert’s model of the future compared to the Walker and Tizard’s and it very much matches our own observations.
In the work we do, we have noted the increased frustration as local people try to develop new ways of meeting their own needs – frustration with public bodies who appear to be acting as gatekeepers. The truth is that the financial and demographic challenges we face now can only really be adequately be answered by the kind of opening up, participation and collaboration that sits at the heart of this new paradigm. The market mindset and NPM took us a long way – their persistence is testament to that. But it’s time now to consciously move on, to recognise that this move is under way, and to understand how we work to strengthen local democratic systems in consequence of the pressures under which they may now be put.
There will always be a place for traditional management accountability – a renewed focus on “value for money” and what it means for us and the services we provide is probably long overdue. Central oversight, where it is going to exist, should also be more joined-up and robust; a clearer use of VfM as a thread that runs through that central accountability is probably sensible. But these traditional models offer only a partial solution to the challenges we will face in the future.
That future looks to us like one where collaboration and local communities must be at the centre. It’s a future that, for us, holds some optimism, and one in which we hope to play an active role – as citizens just as much as professionals.
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