News analysis - Thomson backs spending devolution

22 Nov 01
Wendy Thomson, head of the Office for Public Service Reform in the Cabinet Office, has thrown her weight behind the idea of a genuine and extensive transfer of powers to local service deliverers, in both the health service and local government.

23 November 2001

Her message, given extra authority because of her close proximity to Prime Minister Tony Blair, is already evident in the new emphasis by the Department of Health on 'frontline control'. Thomson is encouraging officials writing the local government white paper in the Department for Transport, Local Government and the Regions to reserve 'real freedom' for councils, provided they meet government targets.

The phrase 'earned autonomy' – freedom granted once local organisations meet their targets – is being downplayed in favour of 'devolution of power'. Recent speeches by ministers such as Alan Milburn and Hazel Blears in health and Lord Falconer and Nick Raynsford in local government (Transport Secretary Stephen Byers has been preoccupied in recent weeks) have picked up the theme and highlighted freedom and local control.

Thomson was appointed to the Office for Public Service Reform in the summer from the Audit Commission where she had been responsible for establishing the Best Value Inspectorate. She was previously chief executive of the London Borough of Newham.

The OPS is based in the Cabinet Office but Thomson has an office in Number 10 Downing Street and sees Blair regularly. Eschewing a 'big bang' approach to reform, she and her staff are engaged in intensive consultation and conversation with Whitehall departments to identify problems in management and delivery. While Michael Barber, director of the Delivery Unit, has set strict targets for the Home Office, health, education and transport departments, the OPS has been trying to win hearts and minds.

Under Thomson, the office looks like becoming a super consultancy, encouraging senior officials across Whitehall in a series of seminars and bilateral meetings to focus more clearly on their mission, how it is managed and whether internal structures need changing. The Cabinet Office's own capacity in Whitehall's corporate management has been strengthened.

With the Department of Health, the OPS has been working specifically on the introduction of primary care trusts. Under the National Health Service Reform and Health Care Professions Bill now before Parliament, 75% of NHS spending is to be transferred, though PCTs will be limited in how much commissioning of acute care they do. All GPs in England are meant to be transferred to new PCTs by March next year but there is some doubt this target will be met.

Mark Baker, medical director of the North Yorkshire Health Authority, warned recently of 'organisational turmoil' compromising the ability of the NHS to deliver. The government recently decided to add public health responsibilities into the PCT mix together with qualitative targets for reducing health inequalities.

A special review of PCTs being conducted by the OPS is looking, among other things, at how they will contribute to the delivery of public service agreements (PSAs) not just for health but for local authorities and other local service deliverers.

Health Secretary Alan Milburn has stuck to the script in enthusing about how 'decentralisation and devolution are being driven throughout the NHS'. But the OPS has tried to persuade him to tone down his criticism of 'NHS bureaucracy'. In a recent speech he talked about 'tiers of management being stripped away' but there is now agreement within the DoH that the PCTs will only work if they can recruit

top-quality managers. A recent report from the King's Fund argued that much more will have to be spent on administration if the shift of power to primary care is going to work.

In tune with recent moves by the Audit Commission to lighten the burden of the Best Value regime for local authorities, the OPS is emphasising the freedoms councils ought to enjoy once they meet agreed targets. The forthcoming local government white paper will talk about the 'flexibilities' of councils in meeting their public service agreement targets.

According to a recent text from the DTLR, 'the government is prepared to remove statutory and administrative obstacles to achieving more "stretching" service outcomes. Ideally the case should be made in a way that sets the "obstacle" against the offer of specific improvements in service delivery if it were removed. This will help to focus government departments on the practical obstacles to delivering better services inherent in the existing policy framework.'

PFnov2001

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