All modernisers now

10 Jun 05
TONY TRAVERS | Public services will never return to the ‘good old days’ that many traditional Labourites still, nostalgically, hope for.

Public services will never return to the ‘good old days’ that many traditional Labourites still, nostalgically, hope for.

In a world where the Europhile French have voted against a European Union constitution in an attempt to stifle ‘Anglo-Saxon liberalism’, it is clear that the British model of social democracy now looks very different to the corporatist ones apparently on offer in France and Germany. Modernisation is not just a phase. In the years ahead, public provision will evolve still further.

The Blair government’s original efforts to ‘modernise’ the public services had two key drivers. The first was New Labour’s desperate desire to distance itself from the bad old days of Wilson, Callaghan and perceptions of the Left’s historic inability to manage public spending.

The second was a belief that unless the NHS, schools and other provision were as good as private provision, affluent citizens would exit, leaving low-quality services for the poor.

Neither of these reasons for Blair/Brown public service reform was likely to endear them to traditional Labour supporters, though the second at least involved a whiff of the original justification for the welfare state. But by summer 2005, there have been so many different incursions into the original ‘100% public’ model that it is impossible to imagine the clock being put back. The NHS illustrates this point in several different ways.

Britain now provides health facilities using public-private partnerships and Private Finance Initiative deals. Hospital doctors often find themselves working in gleaming buildings that belong to multinationals. Services are bought in wholesale from overseas medical providers. Everything from the doctor to the nurse to the patients’ bandages is provided privately. The management of medical records and other back-office functions is likely to be ‘outsourced’ to a telecommunications giant. Wards are cleaned and meals are made by yet another private company.

Consultants and lawyers determine and write the contracts. GPs and consultants remain — as they have always been — private sector operators.

By any standards, the modern health service is a mixture of types of provision, employment status and patterns of ownership. The key remaining ‘traditional’ elements are, first, that the taxpayer still ensures most provision is free at the point of delivery while, second, health authorities are responsible for the local choreography of the different elements of the NHS.

Other public services have moved in the same direction. PPPs and PFI schemes are widely used in education, the prison service and the transport sector. Outsourcing is widespread throughout local government. In short, the public sector in 2005 is nothing like the one that existed in 1979. The intervening years have seen step-by-step changes in the way in which provision is secured. It is virtually certain that in the years ahead further changes will radically alter public provision.

The process of change is attended by reports from think-tanks that have lobbied for, and then justified, change. The word ‘modernisation’ has been re-interpreted by New Labour thinkers in their attempts to maintain an effective intellectual case for the gradual move away from the traditional state model.

We reinvented government. The Third Way came and went. New Localism is still with us.

Things will not be much different if and when there is a change of government. The private sector is widely present in so many parts of public provision that there are trade associations, conferences and publications that cater for this particular kind of public-private quasi-market. Gershon-induced reforms are intended to encourage even more experimentation and reform.

Many public sector managers have become accustomed to a world of partnerships, contractors and public sector entrepreneurship; senior managers themselves have become drivers of modernisation.

The move from the traditional public sector is not as exotic as sometimes suggested. Other European countries operate mixed public/private provision on a scale well beyond Britain’s efforts. Private and not-for-profit providers operate within ‘universal’ public systems in countries such as Germany, Sweden and the Netherlands.

As the future of public provision continues to be debated in Britain, pressures on taxation and public expenditure will underline pressures for efficiency and productivity. New forms of private and not-for-profit operators will emerge. We may even see the introduction of compulsory private pensions, further blurring the line between public and private provision.

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