The Independent View: The Public Service Users Bill is an opportunity for Lib Dems to show whose side they’re on

weownitIn 2011, Nick Clegg strongly backed the government’s ‘open public services’ agenda. In practice, this was used as a figleaf for outsourcing everything from prisons, probation and the NHS to council services. Corporations like G4S, Serco, Atos and Capita have won billions of pounds in contracts yet they are hugely unpopular with the public and the scandals keep coming.

Clegg also promised to ‘take a hard line against the kind of blanket privatisation which was pursued by governments in the past’. Yet the coalition has sold off the Royal Mail, the blood plasma supplier, the search and rescue service, the student loan book…the list goes on. It couldn’t get much more blanket. Meanwhile, rail fares and energy bills rise and rise.

While Clegg talked of ‘modernisation’, this feels more like a dark age for public service users, where we are ripped off, ignored and locked out of the decision-making process at every turn.

What would re-establish the Lib Dems as a party for public service users? How can we give people a real say in the public services that they use and pay for?

We Own It is a new organisation which aims to stand up for the rights of public service users. We’re asking Lib Dems to commit to a Public Service Users Bill in your 2015 election manifesto.

This Bill would give public service users a right to be consulted about services. Crucially, we’d be consulted before they are privatised or outsourced (supported by 78% of Lib Dem voters). The public would get a say over Danny Alexander’s plan to sell off further billions of public assets.

The Bill would give us rights vis-a-vis the private companies running our public services, forcing them to be transparent and respond to Freedom Of Information requests (supported by 93% of Lib Dem voters). We would have a right to recall them when they do a bad job (supported by 90% of Lib Dem voters).

The Bill would require government to look at public ownership first (supported by 65% of Lib Dem voters). There would always be an in-house bid when services are contracted out (supported by 83% of Lib Dem voters). Organisations with a social purpose – cooperatives, genuine mutuals, social enterprise, charities – would be promoted above private companies in the bidding process (supported by 68% of Lib Dem voters).

The Lib Dems have an opportunity to commit to a Public Service Users Bill and show they’re serious about modernisation, accountability and openness. As consumers, people expect to have some rights. As public service users, people expect high quality services and fewer (or no) scandals. As taxpayers, they expect transparency about how their money is being spent. As citizens of a democratic country, they expect to have a voice.

We would love to hear from Lib Dems who want to embrace this agenda and stand up for the people who use public services.

* Cat Hobbs is the Director of We Own It

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10 Comments

  • I totally agree with this move to stop the ratcheting effect of privatisation. The only problem is that it is shutting the stable door after so many horses have already bolted.

    Can’t we force existing privatised services to be subjected to the same conditions e.g. privatised railway services?

  • Richard Shaw 7th Jan '14 - 12:24pm

    Isn’t this asking for a Bill where better contract management in central or local Government is needed? Would we get the same rights over a public service provider as those suggested above be imposed over a private provider?

    And isn’t favouring ‘social’ enterprises over private just plain anti-competitive? By all means, impose social goals and conditions in the tender and let the private and third-sector compete to meet them but a presumption in favour of one form of enterprise over another is just blatantly unfair and does a disservice to customers and service users. (This is similar to rules where you can’t restrict EU-based companies in favour of local ones, but can put conditions in the tender about fulfilling local social and employment needs)

    I want the best provider for the job, whether they be employed directly by central/local government or outsourced. If the quality of service sucks, in either case, you need to hold the people who devised or gave them the contract to account, not some special interest pleading.

  • Agree with the poster above that these proposals seem anti-competitive, including the one about public ownership being ‘looked at first’- what does that mean? surely what matters is the quality of service and the outcomes delivered. We need better commissioning, not arbitrary rules favouring particular sectors (which are probably in conflict with EU procurement law).

  • Latest Ashcroft poll:
    “This has been a big area of change as the chart above shows with the Lib Dems losing nearly three quarters of their 2010 vote. The big gainers have been UKIP and Labour”.
    Once again we see how UKIP is hitting Lib Dems as hard if not harder than the other two main parties, yet for some reason we do not want to get to grips with this dimension.
    Lib dems have lost three quarters of their public service vote to Labour”.

  • An excellent proposal which has my full support.

    Osborne is, of course, not letting a good crisis go to waste; irrespective of whether or not asset sales are an appropriate response (they’re not) he’s using the excuse of a crisis to drive sales of public assets and services far further and with much less critical analysis than Thatcher would have ever contemplated. But then she had some sense though very far from being a liberal.

    I profoundly disagree with Richard Shaw. The idea that all human relations are market relations and that competition is a panacea for all management failings is one of the central deceits of neoliberalism. Hence, in part, the neoliberals desire to remodel (deform might be a better term) public services that don’t work in a market context to the point where they can be shoehorned into some structure that looks vaguely like a market. Even Adam Smith recognised that many services are not effectively delivered by markets.

    From this is follows that it’s not just a problem of better procurement or contract management by government. Sure, running public services is complex and not always well done and I firmly believe that there are massive savings to be made. But can these be won from operational efficiencies or are they the consequence of some politicians driving programmes for a PR payoff rather than to get a quality result where this might not look so good in the short run? What is certain is that inserting a new organisation with its own profit-seeking and executive-enriching goals while at the same time swathing the whole thing in legal contracts (if only it were merely red tape) and reducing the transparency and accountability to near zero, all seems hardly calculated to work well – or even work at all.

    Then there are a whole bunch of other considerations that rarely get an airing. Using PFI to build a school or hospital may sometimes lead to more effective project management (but that’s not certain). But is that really the problem? Isn’t it much more likely to be gold-plated specifications or design changes half-way through the build? If that is the case then PFI may well increase costs and certainly misses the point. And what is certain is the cost of sky-high interest rates will swamp any modest savings under other heads.

    We are always promised that regulation will prevent profiteering but somehow it doesn’t seem to work like that. We also know from experience that it’s more often than not inadequate with the energy utilities as exhibit A. At the very least, and as a first modest step, let’s do as Cat Hobbs suggests and require outsourcers (and their sponsoring ministries) to provide full transparency so the media, bloggers etc. can expose malpractice where it exists. Isn’t that why belief in transparency is a core Lib Dem value?

    One example. In 2011 the government awarded a £300 million contract for all court translation services to Applied Language Services (ALS), a company set up in a bedroom by a failed Dragon’s Den applicant who is not even a linguist. The promise was that court translation costs would be cut by a third. In reality many cases have been delayed because of the failure to supply translators. Now I would love to know (a) what the total cost of such delays is, and (b) how much has been clawed back in compensation from Capita PLC who now own ALS? I suspect the answers go a long way to explaining why transparency is not flavour of the month with outsourcers.

  • In the interests of full disclosure, I’ve worked in public procurement both within government and in the private sector, so I’ve seen a lot. I’ve worked procurement, contract management, gateway review and implementation. with that in mind whilst I can understand where this is coming from I’d disagree that it’s an appropriate answer to the issues around assuring service delivery to the citizen. The article presupposes that public provision is an inherently good thing, rather than working on the basis that each service should be treated on a case by case basis.

    That said, I’d agree that in any outsourcing procurement an in-house proposal is a useful benchmark. If nothing else it forces some management discipline and rigour on an operation. My experience has been that many public sector operations don’t really have a clear appreciation of their operating model, and the process of going through a procurement can drive out efficiency in the in-house operation. Where there are weaknesses are around the ability to actually do something with that information. Change leadership is frequently weak with a lack of appetite to actually start doing something to improve the citizen experience of the service. That rather undermines the potential for a meaningful in-house bid. I’ve always encouraged in house bids, but I’ve never seen a competitive one, the most common failure being accounting for the headcount in the cost model, when I challenged this once I was told that Civil Servants didn’t cost anything. Up against that thinking from someone fairly far up the food chain there isn’t much hope.

    Where I’d see the difficulties are identifying the service to outsource, or how to chunk up what’s being procured in a meaningful way. I’m unconvinced that this is always appropriate or well thought through. The issues with the utilities industries are articulated upthread. Many of the issues that we see in power provision, and rail services are as much about industry structure as public vs private ownership, or indeed the level of regulation and the nature of the regulators. Couple that with frequently naive expectations of performance and we end up with a very complex environment. A job I did about 10 years ago had an expectation of 100% uptime but no funding for a business continuity system… shouldn’t take much to appreciate how well that went

    Realistically what would make a difference is significant professionalisation of both procurement and contract management. I was dealing with a citizen facing service about 18 months ago, discussing a service failure, and the public sector contract manager didn’t know what remedies could be expected from the supplier for not providing the service required. The service had been degraded over a number of years through these “custom and practice” failures to hold the supplier to account. Similarly I did a contract review where the contract manager had failed to benchmark the supplier pricing at the benchmarking point. The opportunity had been missed to negotiate the prices down by 30-40%. I’ve seen that in a number of PFI deals as well, the opportunities to drive down the cost isn’t taken. These people are failing those who pay their salaries.

    Whilst assuring improved service to the citizen is exactly what we should be driving for I’m unconvinced that we as Lib Dems should be advocating a presumption of state ownership. We need to focus on the outcomes, not the inputs. We need to put in place systems to improve the management of both in-house and outsourced services. It’s entirely possible, but it needs a real shake up of both central and local government.

  • Privatising the student loans company could have serious implication. I read somewhere (but having difficulty now finding it with Google) that something like 40% of student loans are likely to be written off. Much of it due to non-British students being very hard to trace.

    If the loan company has to make some profit, then surely this shortfall has to be made up by increasing the amounts that all students have to pay. Maybe to £13-£15k per annum rather than the current £9k.

    Could we get foreign students to guarantee the loans against some assets? For example their parent’s house. Just thinking outside the box, no doubt another member will be able to think of a better solution to this serious problem.
    Or get the lottery to fund it? It would obviously not be right for the taxpayer to be liable.

  • Chris Burden 24th Jan '15 - 5:56pm

    @ Cat Hobbs | Tue 7th January 2014 – 10:46 am; Great piece, Cat!

    @Richard Shaw 7th Jan ’14 – 12:24pm; claims to believe all that matters is ‘delivery’: “I want the best provider for the job, whether they be employed directly by central/local government or outsourced. ”

    This uncontentious statement hinges on what he means by ‘delivery’, of course. Is it purely a matter of metrics and measurables, or of something more? A clue is that he starts with the neo-liberal assumption that, at best, there is no intrinsic benefit in ‘delivery’ by a non-commercial provider; that, in effect, market rules, a ‘market situation’, must prevail: “And isn’t favouring ‘social’ enterprises over private just plain anti-competitive? By all means, impose social goals and conditions in the tender and let the private and third-sector compete to meet them but a presumption in favour of one form of enterprise over another is just blatantly unfair and does a disservice to customers and service users. (This is similar to rules where you can’t restrict EU-based companies in favour of local ones, but can put conditions in the tender about fulfilling local social and employment needs)”

    The argument here, then, is about the wisdom and efficacy of artificially creating ‘market situations’ where none naturally exist, typically to deliver an essential service currently provided by the public sector. Richard and other neo-liberals do not acknowledge that ‘marketising’ a service leads to a fundamental change in the nature of the relationship between customers (residents, service users etc.) and the provider, beyond metrics and measurables. That is, a change in the very nature of the service. A profit-maximising ethic for things that money should not buy leads to a kind of corruption in the nature of what is being offered. I recommend ‘What Money Cannot Buy – the moral limits of markets’ by Harvard professor Michael Sandel. Please find a review below.

    https://philosophynow.org/issues/98/What_Money_Cant_Buy_The_Moral_Limits_of_Markets_by_Michael_Sandel

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