26 March 2004
Gordon Brown's pledge to prune Whitehall's army of Sir Humphreys and slash billions of pounds from the government's annual spending bill ensured that these issues dominated last week's post-Budget headlines.
But, alongside the attention-grabbing announcements of a chancellor who likes to spring a surprise in his set-piece statement to Parliament each year, a document was quietly published that could have far-reaching implications for the future delivery of public services.
The report, Devolving decision-making, is the product of a joint review by the Treasury and the prime minister's Delivery Unit that was launched by Brown in July 2003. Its conclusions will feed into the Spending Review 2004, expected in July. One of several reviews whose reports were published under the aegis of the Budget on March 17, its conclusions are interesting especially as they are endorsed by the chancellor in the foreword.
The report calls for a radical overhaul of the current system of managing the delivery of public services centrally run, target-driven and with precious little flexibility on the front line. It argues for this new approach in the name of greater efficiency, the political buzzword of the moment.
According to Brown, there should be a 'radical devolution of responsibilities' from Whitehall ministries to the front line. This should be accompanied by 'greater transparency, proper audit and new incentives and an ambitious agenda to encourage local autonomy and managerial flexibility'.
The report recommends that Public Service Agreements should be the vehicle for Whitehall departments to specify national service standards, and all other 'input, process and output targets' should be drastically cut. This prescription-busting approach would also mean big reductions in ring-fenced funding regimes and the plans produced by service deliverers for their ministry paymasters.
'Reducing targets alone will have a limited impact on the overall level of bureaucracy faced by schools, hospitals or local government, if ring-fenced funding remains at a high level or excessive numbers of plans are required,' the report says. Instead, providers should be allowed to decide these issues for themselves and set their own local targets to reflect service priorities in their areas. 'PSAs should set the outcome and, other than in exceptional cases, the front line should then be responsible for identifying the best method of achieving that outcome.'
In a further loosening of the reins, organisations such as councils, strategic health authorities and police authorities would assume responsibility for performance managing 'frontline units' such as schools, hospitals and basic command units, with the duty to step in when services were deemed to be poor.
Under this new regime, 'giving the public access to transparent performance information' would be a principal way of holding services to account. The data collected for a few key performance indicators would be used to monitor how services are doing, instead of the current complicated arrangements.
And, as is the case with the Comprehensive Performance Assessment for local authorities, successful organisations would enjoy greater autonomy from the centre. 'High performance needs to be rewarded with additional autonomy and flexibility to provide incentives for improvement and to increase efficiency in the use of resources,' the report says.
Judging by Brown's comments in the foreword, it would seem that this new-found willingness to relinquish central control emanates from the very centre of government. But the big question is whether this report will mark the moment that the reality of public services provision finally catches up with the government's rhetoric of 'new localism'. It could prove to be another false dawn.
The Local Government Association is cautiously optimistic about the government's intentions. Chair Sir Jeremy Beecham says ministers are at least moving in the right direction: 'Top-down solutions to efficiency or remotely derived models will fail. An agenda that twins the efficiency drive with a devolution drive is the answer.' But he is calling on the government to ensure that this is 'not just another initiative', but part of a consistent broader agenda that will deliver real devolution of power.
His plea gets to the very heart of the issue. The report reached one fundamental conclusion: 'Most importantly of all, a new level of trust needs to be built between central government and public service providers.'
If ministers are serious about achieving this objective then, come July's Spending Review, they will need to take concrete steps to implement the findings that Brown has so enthusiastically endorsed.
PFmar2004
