I watched with amusement last week when Gordon Brown, David Cameron and Nick Clegg each told business leaders, assembled for the annual CBI conference, that they had the right plan to slash record government borrowing. None gave any precise details; the only obvious dividing line was that a Conservative government would introduce a deficit-busting budget within 50 days of the next general election, while Labour and the Lib Dems won’t start cutting spending big time until they are convinced that a solid economic recovery is underway.
The really big political question is of course what the coming fiscal austerity, whenever it begins, will mean for public service delivery. This week the Conservatives will attempt to kick-start a policy debate on “doing more with less”, which should at last enable us to get a clearer view of where they are coming from on getting better value for money from the public sector. Meanwhile, press reports suggest that the government will shortly publish a white paper on “smarter government”, including a cull of quangos and cost-cutting measures to reduce the number of senior civil servants and relocate more civil service jobs to cheaper locations outside London.
The backdrop to all this is not simply the need to bring the public purse back into the black but also the seemingly perennial problem of poor public-sector performance. According to the Office for National Statistics, public-sector productivity fell by 3.2 per cent between 1997 and 2007, an annual average fall of 0.3 per cent, despite rapid growth in public spending. So can we realistically expect the public sector to do more with less after years of having achieved less with more?
A popular argument, which the Conservatives are pursuing, is that poor public service performance can be traced to the Labour government’s centralised target culture and an associated lack of autonomy for front-line professionals to “get on with the job”. My view, however, is that these things are themselves mainly symptoms of underlying performance problems in the UK’s public sector rather than the root cause.
What really stands in the way of making public-sector workplaces more productive are too many managers who aren’t up to the job and a centralised system of employment relations that enables powerful trade unions and other professional producer interests to squeeze as much as they can from taxpayers’ money. Failure to confront these barriers to improved public-sector performance outcomes will derail efforts to do more with less whenever the inevitable cuts in public spending finally kick in.
The public sector is over-managed in numerical terms (the “too many pen-pushers” view has merit) but seriously under-managed when it comes to management quality. Too few doctors, nurses, social workers, teachers or police officers receive sufficient training to manage people productively. Public-sector line management capability is cripplingly poor in a range of areas that have a direct impact on service delivery, including absence, stress, conflict management and especially performance management.
Problems associated with poor line management are in turn exacerbated by centralised employment relations and pay determination systems that enable powerful trade unions and professional producer interests to reach deals on employment levels, conditions of work and pay that deplete the public sector of resources that could otherwise be used to improve service quality.
Getting more from less is far easier said than done. Proposals to improve public-sector performance by putting trust in front-line professionals are laudable, but we need to be realistic about the significant barriers that continue to stand in the way of progress - notably far too many front-line managers with limited ability to manage people and a system of employment relations that most private-sector workplaces waved goodbye to years ago.
The coming fiscal austerity - which I reckon will require 600,000 public-sector job cuts and no average real-term increase in public-sector pay before 2013 at the earliest - will expose these barriers like never before.