Mutuals: where's the proof?

18 Aug 11
Paul O'Brien

Ministers are keen to promote mutuals as the way forward for the public sector, but there is little evidence to suggest that these will help to improve the quality and efficiency of services

Many extravagant claims have been made about the potential benefits that co-operatives and mutuals could bring as service delivery vehicles for the provision of local public services. However, when the evidence is examined in detail do these claims stand the test of scrutiny?

The latest research publication from the Association for Public Service Excellence, Proof of delivery, finds very little evidence base to support any of the claims made about the superiority of co-operatives and mutuals over any other form of service delivery in public services. From 1,600 sources our researchers were only able to find 12 case studies where any impact evaluation had been carried out.

For a concept that is being pushed so hard as a response to the cuts agenda this is asking decision makers to take a huge leap of faith.

From the limited evidence base that exists there are some key factors for successful operation of mutuals and co-operatives within the public sector. These include:

  • Contract lock in – an initial sufficiently long contract in terms of volume of work and financial commitment to allow bedding in of new arrangements and also ensuring the avoidance of future divestment of services that would change the character of the original body.
  • Collaboration – the need for on-going support through public subsidy, advocacy and expert advice in order to support the fledgling organisation.
  • Buy in – there needs to be buy in from all stakeholders, staff, elected members, citizens and service users.

Apse has argued for a number of years that without on-going support, collaboration and facilitation from the public sector the social economy will struggle to survive. This research reinforces this message.

A further point to emerge from the research is that there appears to be downward pressure on staff terms and conditions brought about by the formation of co-operatives and mutuals. At a time when statutory protection of terms and conditions are being removed from public sector workers by the government this is highly unlikely to generate great enthusiasm for a transfer to this model of provision among the key asset of any organisation, the staff.

A final and fundamental point is the fact that very little evidence exists of accountability to elected members and/or the wider community. In a time of diminishing budgets and intensified scrutiny of public spending, are local politicians really going to handover public funds to bodies with a self interest without any influence or recourse should things start to go wrong?

We need a proper evidence-based debate on the role that co-operatives and mutuals can play in public service delivery. Where they can demonstrably add real value, they should be supported. Anything less would do local communities a great disservice.

Paul O’Brien is chief executive of the Association for Public Service Excellence. The Proof of delivery research was undertaken through Apse’s knowledge transfer partnership with De Montfort University. It is available for sale here

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