13 October 2006
New Audit Commission chair Michael O'Higgins is quietly determined to turn up the heat on his inspectors to ensure they stay in touch. And he is no slouch in the kitchen either, as he tells Joseph McHugh in an exclusive first interview
Celebrity chef Rick Stein can expect a particularly exacting student to turn up at his cookery school in Cornwall one day soon.
The new chair of the Audit Commission, Michael O'Higgins, is a keen amateur cook and is looking forward to donning hat and apron to whip up something tasty. The course, which he will be doing when his schedule permits, was a gift from colleagues at PA Consulting when he left his position as managing partner of the public sector practice earlier this year.
But if the softly spoken Dubliner's determination to protect the public's rights as service users is anything to go by, he will expect nothing less than first-class teaching when he is learning how to make the perfect sea bass with sauce vierge.
O'Higgins, just one week into his three-year term when we meet at the commission's Millbank Tower headquarters, is personable and unassuming, but it is clear he takes his responsibility as guardian of the public purse seriously. Government ministers and public bodies should take note.
'It is not our job to seek headlines and we don't have to shout loudly to get our message across,' O'Higgins says. 'But if we need to say something, we will. There's no doubt about that.'
His attitude marks him out as different from his predecessor, the combative James Strachan, who departed abruptly in January, after controversy over the 2005 Comprehensive Performance Assessments. Sir Michael Lyons took over as acting chair.
O'Higgins is equally determined to do things by the book when it comes to the commission's internal workings. Early on in the interview, he declares: 'It is not my job to run the organisation, that is chief executive Steve Bundred's job, I'm very clear about that.'
Instead, he views his role as that of a watchman, keeping an eye on the big picture so the organisation meets the challenges thrown up by the public sector reform agenda, while ensuring that the decisions taken are implemented.
O'Higgins also sees himself as a conduit between the commission and the outside world, being visible and available to 'stakeholders' – the hundreds of public bodies that the commission regulates – so its inspectors are attuned to the demands facing service deliverers on the ground. And those demands are pretty exacting, with change in the air across the public sector.
Local government, the commission's biggest sector, is waiting to see whether Ruth Kelly delivers on her devolutionary promises in the local government white paper, widely rumoured to be published in a couple of weeks' time. That will be followed later in the year by the long-awaited report from Sir Michael Lyons' inquiry, which is eagerly anticipated for what it will say about town hall finance.
O'Higgins, while insisting that sound financial management must be the top priority, recognises that the across-the-board improvements revealed by the CPA mean councils are entitled to demand a loosening of the reins.
'There is no point in us saying that inspections won't happen, because ministers and the public simply won't have it,' he says. 'We need to combine the reassurance of an inspection regime with more targeted activity that focuses on outcomes, rather than processes.'
But, in return, town hall leaders must be willing to accept responsibility for service failures, he says. 'There are going to be things that go wrong. When that happens is local government willing to step forward and say this is not the minister's fault? If they are, ministers will be more willing to let go.'
The advent of local strategic partnerships between councils and other local service providers is another factor the inspection regime will have to take account of when trying to define clear lines of accountability.
O'Higgins will chair his first meeting of his fellow commissioners in a couple of weeks' time and, although he remains tight-lipped on current thinking, he reveals that the post-2008 regime will top the agenda. 'These are the sorts of challenges we will be grappling with over the next 18 months,' he adds.
The NHS, which is the commission's other main client, will figure just as prominently in O'Higgins' life in the coming months.
The recent high-profile financial problems experienced by many trusts have cast the commission in the role of doctor, expected to diagnose the problem and prescribe a cure.
So far, the commission has, as he puts it, been 'lifting up the stones to see what's underneath'. O'Higgins thinks the main problem has been the poor information systems within trusts which has meant a dearth of proper performance and management data.
For O'Higgins this is the crucial issue that must be addressed to prevent trusts feeling the financial heat again in the future. It will also help them plan services to meet the needs – and demands – of patients.
'Ensuring the quality of information and the correct use and interpretation of it is crucial. We have also got to try to get more data in real time, because what there is is often only available three or six months later.'
Once these systems are in place – itself no easy task – they can form the basis of a customer-focused health service, he says. Payments by results is a powerful tool in this respect, and the commission's role is to make sure the data exists and is being used properly. 'We need to get as close as possible to what is happening on the ground, which means taking the systems down to the level of individual services,' he explains. 'Then we have to find ways of taking account of customer preferences. You can't divorce people's expectations of the public sector from their expectations of the private sector.'
O'Higgins is clearly clued up on the current issues and tensions in the public service reform agenda.
But just to be on the safe side, he is busily closing any remaining gaps in his knowledge. In one corner of his office, too recently occupied to bear any personal touches, 12 lever-arch files stuffed with documents are cluttering up the table. 'My briefing notes,' he explains with typical understatement.
They are likely to keep him out of the kitchen – and away from the terraces at his beloved Tottenham Hotspur – for a while. His other hobby, running, is already on hold thanks to an injured Achilles' tendon.
O'Higgins is a thoughtful, reflective person and his willingness to grapple with the intricacies of public service improvement reflects his background as an academic. Following a doctorate at the London School of Economics, he spent nine years as a lecturer in public policy at the University of Bath.
In 1987 he was invited to take part in a 'fantasy Budget' exercise, where he was the social services minister and had to bid against the other 'ministers' to secure funding for his department. At the event he caught the eye of the top brass at Price Waterhouse, as it was then, and shortly afterwards left the groves of academe for the cut and thrust of commerce.
His first project was an 18-month secondment to the Organisation for Economic Co-operation and Development, the international research institute based in Paris, where he wrote the papers for the first ministerial conference on social services.
He returned to the UK in 1988 and for the next nine years worked in PW's public sector practice, both here and abroad, leading its work on community care and health efficiency.
This period also involved a two-year stint working for the Turkish government in Ankara, where O'Higgins researched the availability of basic services. 'More people had access to a colour television than to running water,' he says.
In 1997, he left PW to become managing partner of PA Consulting's public sector practice.
Along the way, for good measure, he has also been an adviser to the social services select committee, acquired a visiting professorship at the LSE, and since 2004 he has chaired the board of homelessness charity Centrepoint.
This wealth of experience spanning the public and private sectors should stand him in good stead as he gets to grips with his new role.
But he already knows the direction he intends to take the Audit Commission in under his watch. 'Any inspection regime should be about helping people to improve. We need to move from a culture of blame to one where people are confident of asking for help.
'Doing that is a sign of strength, not of weakness, and that is something people need to understand.'
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