Whitehall Focus - Measuring quality absurd idea, scorns Letwin

22 Jul 04
Shadow chancellor Oliver Letwin has dismissed as 'absurd' claims that measurements of Whitehall productivity can be changed to reflect accurately 'value added' improvements in services.

23 July 2004

Shadow chancellor Oliver Letwin has dismissed as 'absurd' claims that measurements of Whitehall productivity can be changed to reflect accurately 'value added' improvements in services.

It follows the publication on July 19 of Sir Tony Atkinson's interim report on assessments of public sector outputs.

Atkinson's government-commissioned study calls on Whitehall departments and the Office for National Statistics to provide quality-adjusted data on schools and hospitals' productivity, for instance, to reflect the value they add to society and not simply the sums they spend.

It suggests outputs should be measured by the 'incremental contribution to individual or collective welfare, that is, by the value it adds'. One example could be to reflect improved GCSE attainment in Whitehall output data.

Atkinson also calls for more resources to be invested into data collection and urges bodies such as the NHS to use new data technologies to 'support better future analysis of health care outputs'.

Measuring productivity has become politically sensitive in recent months, following Tory accusations that the government attempted to influence ONS statistics to show that huge investment boosts have resulted in improved services.

Consequently, Atkinson recommends independent corroboration of government data, including possible peer review by bodies outside the UK, such as the European Union's statistical centre, Eurostat.

Letwin remains unconvinced. 'The idea that quality improvements in the public services can be objectively measured and that such a fuzzy concept should be captured in the measurement of national output is absurd,' he said.

'The role of the Office for National Statistics is to provide reliable and robust economic statistics in which the public has trust, not to act as a propaganda tool for the government.'

However, Treasury minister Ruth Kelly denied that government scrutiny in output measurement was motivated by a need to show improvements before the election.

She said it was 'in the interest of all parties and taxpayers that we get a better handle' on productivity. ONS chief statistician Len Cook, under fire following recent revisions to the flawed 2001 Census, welcomed Atkinson's interim findings, which described his organisation as a 'world leader' in measuring outputs.

'This report makes it clear why improving estimates of government output are a top priority for the ONS,' he said.

Atkinson's full report will be published early next year.

SFO costs mirror growing white-collar fraud

The cost of running the Serious Fraud Office rose by 25% last year – reflecting a sharp increase in white-collar crime.

The SFO 2003 annual report, published on July 19, shows that costs increased to £33.2m compared with £26.3m for 2002. Overall, the cost of running the SFO has risen from £16m since 1998/99 and is expected to reach £37.7m by 2005/06.

Despite the increasing resources thrown at the problem, the SFO warned that white-collar crime – especially sophisticated fraud – was still on the rise, with the value of alleged fraud investigated last year standing at £1.9bn.

Much of the rising cost was due to an increase in the number of experts employed to chase fraudsters, who are using ever-more complex techniques to cover their tracks.

The number of temporary staff employed, for instance, rose by 56% over the period – the result of two major investigations.

The SFO staff brought 14 cases to court during 2003, involving 39 defendants and 20 successful prosecutions.

The SFO is increasingly seeking to claw back costs by confiscating criminal assets, often using the Assets Recovery Agency. Last year, its investigations led to confiscation orders totalling £3m. But there are still problems retrieving cash that has been moved abroad.

In a letter to the attorney general on July 19, SFO director Robert Wardle said he was working with international governments.

But he warned: 'Fraud has become easier to commit, especially using tools like the Internet, by exploiting jurisdictional limitations on an investigation, which in essence remains tied to national boundaries.'

Mandarins urged to go back to the floor

Whitehall managers have been urged to return to the front line to improve their understanding of successful public services.

A report by the Joseph Rowntree Foundation, published on July 20, urges high-grade staff to take part in local schemes similar to a successful 'social enterprise zone' initiative in East London.

It says these 'back to the floor' schemes would help managers 'reconnect with frontline staff and service users'.

Britain's first SEZ, launched in the London Borough of Newham in 1998, brought together residents and staff from public sector agencies such as jobcentres and the Inland Revenue to solve service problems.

The initiative led to many innovative solutions previously defined as 'elusive', such as how to deal with the 'informal economy'. Some have been adopted nationally.

But report authors Matthew Smerdon and David Robinson found that 'while some senior [Whitehall] officials responded positively to ideas emerging from local consultations, others tended to treat new ideas as unwelcome criticism'.


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