As regular as bonfire night, last week saw the UK’s ritual annual outsourcing row. In 2013 the Institute of Government urged a halt to central outsourcing pending a review on the grounds that Whitehall lacked the management skills to make it work. Last week it was the turn of the Public Accounts Committee to charge that departments were overreliant on a handful of ‘quasi-monopoly’ contractors, two of them under investigation by the Serious Fraud Office for gross overcharging. The ‘markets’ being created by this kind of privatisation, charged the IG, were reducing competition and choice rather than enhancing them.
This is a fail in its own terms: but beyond that choice and competition are in themselves wrong-headed and self-defeating goals. These assertions run so counter to the authorised version that Whitehall simply blanks them out, which is why the outsourcing juggernaut rolls on regardless. This is one of the central themes of John Seddon’s important new book, The Whitehall Effect – How Whitehall Became the Enemy of Great Public Services and What We Can Do About it, which takes as its invaluable task the deconstruction of the current public-service paradigm (which is what it is) and the substitution of a better one.
Disclosure is in order here – while the ideas are distinctively Seddon’s, developed in Vanguard’s hands-on consultancy work across public- and private-sector organisations – I did some editing work on the book. I am proud to have done so, because while, as one Amazon reviewer puts it, Seddon’s narrative will certainly ‘make any rational person angry’, it fulfills a larger ambition. It puts in place a hard evidence base for a replacement offering hope and even (not a word to use lightly) inspiration for those who believe that management and public service have more to offer than cost-cutting, rationing and increasingly intrusive individual performance management.
To my knowledge, no one before has put together a satisfying intellectual pedigree of UK public services explaining both how they have come to assume their current form and why the latter is so dysfunctional. Seddon shows how the computerised call-centre/front-and-back-office/shared service model derives from – and suffers all the disadvantages of – traditional batch manufacturing, with its emphasis on standardisation, economies of scale and unit costs. This model, although still largely followed, was already obsolescent even in manufacturing by the late 1980s. In services, where the nature of demand is infinitely variable, the adoption of standardisation has been predictably disastrous.
As citizens, what we now get are shrink-wrapped, mass-produced service packages designed for lowest cost by commissioners and specifiers. They do such a poor job of meeting real need that they generate more demand (more contacts, more explanation, more referrals and assessments, more useless activity) than they satisfy.
Here in a nutshell is the whole slow-motion nightmare of everlasting austerity: public services that generate demand rather than meet it, apparently justifying more cuts that make matters grindingly worse. As Seddon explains, the ‘choice’ people really want is having their individual needs met; deciding between competing suppliers of similar bog-standard, ill-fitting packages, the Whitehall version of ‘choice’, is a bad joke, a travesty that delivers the worst of both worlds: a kind of market Stalinism in which product and cost are centrally planned and (see the PAC report) contracting is weighted in favour of the largest, cheapest and most cynical suppliers who care most about their shareholders and least about customers and workers.
One by one, Seddon picks off all the current public-service nostrums: as well as choice, personal budgets, commissioning, managing demand (aka rationing), risk management and lean have nothing to do with the purpose of a service in the only way that matters, as a citizen would define it. They are just activity. Some chapters (for example on procurement, aptly subtitled ‘how to ensure you don’t get what you want’) make you want to cry, laugh and smash up the furniture at the same time. As he reminds us, in the absence of real purpose the management measures used – in targets and standards, inspection and regulation and performance management (managing individuals rather than the system) – fill the void, distorting priorities and diverting effort and ingenuity into self-defeating attempts to do the wrong thing righter. The result is degraded services, disengaged citizens and demoralised public-service workers.
By definition, a paradigm is monolithic; at some point, it can no longer be incrementally force-fitted to the emerging evidence and has to be replaced. In other words, you can’t get to where we want to be by altering targets and standards. Getting over this hump is hard – ‘it is difficult,’ as Upton Sinclair noted, ‘to get a man to understand something when his livelihood depends on his not understanding it’ – which is why the careful dismantling of the monolith is essential part of Seddon’s project. But as important is the positive element, ‘the principles and practice’, to quote Lord Victor Adebowale’s foreword, ‘of how public services could empower citizens, could be exciting (yes, exciting) to deliver, and could genuinely add value to the lives of the public who pay for them’.
They could also return lost legitimacy to politics and Whitehall. ‘Politicians don’t know much about management,’ writes Seddon. But nor should they. Their mandated role is not to micro-manage but to focus on the purpose of public services for the people they represent. This ‘puts politicians where they need to be: connected to [their voters], able to appreciate the value of public services in their terms… but also to understand how better services build stronger communities, resolve social problems and lower costs’. Leaders of public services should be freed up to determine the measures and methods they use to meet these ends, with the role of ‘intelligent’ inspection and regulation restricted to testing whether the methods (whatever they are) really do drive improvement against purpose.
One of the ironies is that, when people can break the straitjacket of the dominant paradigm, such an agenda transcends considerations of right and left. Thus, in the US it is gaining traction in avowedly hard-right states like Texas and Utah, where politicians and technocrats are flocking to see how officials are respectively slashing prison populations (Texas of all places has closed three prisons so far) and dramatically reducing homelessness by resolving the issues that threw individuals off course and getting them on their feet again. The motivation is simple: it costs the taxpayer too much to keep people in prison or in homeless shelters, much less to do whatever it takes to get them off the state’s books, permanently. One state’s ‘financial rectitude’ is another’s ‘enlightened treatment of social problems’; whatever, it’s a result.
Under the radar, many similar initiatives in the UK public sector are producing the same kind of results, which Seddon has documented in a number of previous books and articles. This, though, is the most important and authoritative. In the run-up to the election, it has a direct message for every voter and politician as well as service leader: this is a set of ideas whose time has surely come.