By Richard Johnstone | 22 September 2011
CIPFA has warned that the government’s public service reform plans are a distraction from the need to address the deficit.
Speaking at the Public Finance/CIPFA fringe event at the Liberal Democrat conference, institute chief executive Steve Freer warned delegates that the government didn’t have ‘total focus’ on reducing the deficit as it was undertaking other changes.He said: ‘We need total focus on rebalancing the public finances.
‘The government is still trying to do a lot of reforms that do little or nothing to address this huge financial challenge.’
He highlighted the government’s health proposals as one example of where reforms to an important service are diverting management attention from the critical problems posed by much tighter finance settlements.
Arguing that NHS managers were distracted by the changes, he said: ‘If we continue to do these big reforms then the financial challenges aren’t going to get our full attention.’
The government’s public service reforms were also criticised by Chris White, deputy leader of the Liberal Democrats in the Local Government Association at the meeting on September 20.
He called the plans to reform public services a form of ‘Maoism’ where ‘everything is happening at once’.
He said that ‘schools are being led off to God knows where’ by the Department for Education policy of converting them to academies or launching free schools. Other changes are taking place in the NHS and policing.
He said: ‘What’s happening feels like a revolution, but not to replace [the current system] with something else – just for the sake of having a revolution.’
He also told delegates that the government’s front-loading of cuts to local government this year and next had reduced the chances of councils ‘saving efficiently’.
He accused Communities Secretary Eric Pickles of having ‘sold local government down the river’ by agreeing to the front-loading – ‘something from which, possibly, we will never recover’.
Other speakers highlighted that the deficit reduction plan and increasing demand for services meant that the UK welfare state was under ‘terminal pressure’.
Both Dame Clare Tickell, the chief executive of Action for Children, and New Local Government Network director Simon Parker told delegates that the strategy would have to change.
Tickell said the ‘Beveridge welfare state’ was ‘under monumental pressure’ as councils cut services that were not essential, while Parker said that the current system was ‘broken’.
He also told delegates that this year’s cuts represented a ‘practice run’ for those next year, when the ‘easy cuts’ will have been made.
The event also heard from Ian Swales, a Liberal Democrat MP and member of the Public Accounts Committee, who called on government to improve the ‘absolutely shocking’ public spending management.
Swales told delegates he backed the government’s deficit reduction plans, calling the contraction ‘absolutely necessary’.
But he added that there is ‘lots that can be done and that this government needs to do’ in order to reduce the deficit through improved management.
He highlighted that the Department for Work and Pensions admits that it overpays £1bn a year through errors, and that Revenue & Customs had calculated that £42bn of tax is not collected annually.
