10 June 2005
Local authorities are lagging behind the rest of the public sector in their willingness to embrace change and develop new ways of working, the director general of the CBI said this week.
In a keynote address to industry leaders on June 6, Sir Digby Jones attacked the whole public sector for a failure to search consistently for and deliver value for money. But he reserved most criticism for councils.
'Local authorities do seem less open to change, more stuck in their ways and less open to fundamental reform in service delivery than other areas of the public sector,' he told Public Finance later.
But he threw down a challenge to local government to prove him wrong. 'If local authorities want to ring me up and say, “You're wrong,” I'd love to hear from them,' he said.
Jones acknowledged that the Comprehensive Performance Assessment regime had worked well for local government and should be applied to central government.
He also criticised the Gershon efficiency programme as insufficient in itself to secure systematic long-term improvement. In his speech, Jones suggested that a new independent public body be established to challenge and monitor the government's value for money strategies.
'Unlike the National Audit Office, the new body would be forward-looking, not looking at photographs of the present system, and would examine systems used across government rather than looking at individual projects or programmes in specific departments,' he said.
The body, which would stand outside government, might be directed by a panel of experts drawn from across government, business and academia but would be staffed by a small team of specialists with a track record in delivering value for money.
Jones did back the government's recommendation that finance directors should sit on departmental boards, and praised the Department of Health for having a commercial team working on both policy development and delivery.
Opening up public services to more competition and achieving value for money would help keep the business community on side, Jones said, adding that industry could not be expected to go on paying for public spending.
'I am detecting a growing intolerance [among business] to bear the brunt of significant new growth in public spending, particularly when the evidence of improvement in public sector productivity is so weak,' he said.
Jones' call for an independent public body came the day before the Conservatives launched their own 'watchdog', which will measure the government's progress on the Gershon agenda and recommend additional savings. Ministers are unlikely to accept these, however, as the body is being chaired by David James, who conducted the Tories' own review before the election.
PFjun2005
