Some areas of public service delivery are simply too sensitive and high-risk to consider as candidates for outsourcing. Child protection is one of them
The government is consulting on a very radical extension of public service outsourcing. It is seriously considering allowing or even possibly encouraging local authorities to outsource significant elements of their children’s services including child protection.
It is also keen to be able use companies and alternative providers to take over services where in the view of Ofsted and the Department for Education a local authority has seriously failed to deliver effective and reliable children’ services.
The idea that profit making companies including possibly Serco and G4S could play this role has triggered opposition from child care professionals, academics and children’s charities, including Children England, which has successfully launched an on-line petition. Some of this opposition is based on a moral position about profit and public service.
There is concern that certain responsibilities such as taking vulnerable children into care and away from their birth parents should remain a state function but much of it is based on some important democratic, professional and technical concerns. Many of which I share.
There is also a very understandable concern that certain responsibilities such as taking vulnerable children into care and away from their birth parents should remain a state function of course, the business sector and the voluntary sector are already responsible for the management of a range of children’s services and in particular residential children’s homes. The evidence of performance is mixed, but there are some examplar ones.
The voluntary sector has a good record of provision of specialist services – for example for children with special needs and disabled children. Indeed, the voluntary sector has a very important role to play in supporting the public sector in child protection and early intervention to support parents and children; this is not the same as a company taking them over.
It is not clear whether the government’s intention is to transfer such decisions to contracted providers, or for them to provide an element of the required professional service with the final decisions such as whether or not to take a child into care being retained by a local authority. Both approaches would be problematic.
Unless parliament specifically legislates to allow a local authority to transfer its responsibility, powers and accountability for child protection to a third party it is hard to see how the local authority could outsource these; it would have to retain the final decision making element of any process. This could lead to fragmentation and dysfunctional provision.
If there is such legislation, to enable the transfer of powers to a third party, there would be a major diminution of democratic public accountability. But without such new legislation it is very difficult to envisage how a local authority and political leaders would feel comfortable remaining responsible for these very human and high profile decisions without having direct control and the final say. A council would remain accountable and could not transfer the ultimate risk for children’s protection - including errors that could lead to a death of a child.
One has to ask if the public is willing for the business sector to be involved in such decisions and certainly to be the final arbiter. And this at a time when public confidence in public service outsourcing and contractors is falling. Where is the government’s mandate and public authority?
Outsourcing can fragment services; create and/or reinforce silos; and dis-incentivise providers from collaborating. Children’s services and child protection above almost all other public services rely not onlyon their own specialist professional staff but on collaboration with schools, children’s centres, the police, housing, the voluntary sector and others.
Outcomes are subject to many external influences, many of which no single agency or even the specialist professionals can control or often even influence in any meaningful way. This all raises big questions about risk allocation, risk management and risk pricing if the services were to be outsourced.
One would expect that prudent companies would be very cautious about taking on such responsibilities without either demanding a very high risk premium on their contract price and/or having some legal protection for service failure. Reputation risk would be very significant.
Outsourcing also raises a number of important questions about transparency and accountability; flexibility; and the use of scarce public resources. These are critical for services such as child protection.
Effective outsourcing requires excellent client capacity and competency in the public sector; a competitive supply side with providers committed to public service; and public confidence. None of these may be present when a local authority embarks on the outsourcing of child protection services or is forced to do so by government. This is the basis for disaster.
Contracting let alone the procurement of services such as child protection would be very complicated and expensive. How would a local authority incentivise the right behaviours and performance whilst ensuring the safety and best outcomes for children; and how would the client and contractor agree a value for money price for this? How would contractors make a profit whilst securing the best outcomes for every child - outcomes which cannot be prescribed, will constantly change and for which often there is no definitive answer?
For these and many other reasons including political ones there are undoubtedly some public services that are more inappropriate candidates for commercial outsourcing than others. Child protection like front line policing seems to be such a service.
Is this another case of ideology gaining ground over common sense, prudence and the public interest? It feels very much that it could be.
The DfE has provoked a debate, though it may be not the one that it wished to have. It has strengthened the growing demand for an independent enquiry in respect of public service outsourcing. Although outsourcing has been used by successive governments, local authorities and the wider public sector over decades there is very little comprehensive evidence available apart from some limited academic research and a few though often excellent NAO and Audit Commission, studies and reports.
An independent enquiry could amongst other matters consider the benefits and dis-benefits of public service outsourcing in different service areas and in particular
• the financial and operational results including a holistic cost benefit analysis and examination of the net public value of outsourcing in different services, financial environments and through various models of outsourcing
• the role, opportunities and limitations of the market and competition in public service delivery and innovation; and examining the differences more between services and/or areas of the public sector
• building on recent National Audit Office studies to question how competitive the supply ‘markets’ actually are
• how much service users are involved in every aspect of the process from pre-procurement to service monitoring
• implications for staff
• the implications of different ownership models of providers and the benefits of the charity and social sectors compared to the business sector
• accountability and transparency
• public confidence in outsourcing scenarios
• the opportunities and costs of both contract terminations and major change
• the nature of probity and lobbying in respect of public service outsourcing including the relationship between politicians and senior public officials (and those recently retired) and providers
The general election is a year away. Will one or all of the major political parties commit to such an enquiry or will they simply press ahead into this evidence light territory with all the associated risks for vital public services, public assets and the public?
Meanwhile the government should seriously consider withdrawing the consultation on the outsourcing of child protection.