The focus of the re-drafted reform white paper is set to move from privatisation to the Big Society by giving budgets to individuals and to town councils. The CBI view the policy shift as a lost opportunity for improving efficiency.
The reform white paper, Open Government, which was due to be published in March, is now likely to appear in July. The original version was designed to create a level playing field so that private companies could compete on equal terms with public organisations to provide services. Disagreement within government and a realisation that public opinion would not support private companies making profits out of taxpayers led to the re-think.
The latest draft of the white paper provides for the two year old personal budget schemes, originally designed for those who need social and health care, to be extended to parents of children with special needs. There will be further budget delegation from councils to lower tier parish councils to allow them to manage parks, playing fields, parking and traffic restrictions.
Following this theme of moving decision making and money down to the sharp end there will also be provision in the white paper for greater mutualisation. It is expected that by 2015 up to one million current public sector workers, 15 per cent of the existing workforce, will be employee owners and partners in mutuals delivering public services.
There is also likely to be a greater role for Community Budgets which follow the trend towards decision making at the coal face. In April 2011, 16 pilot projects were launched, following completion of the pilot projects for Total Place which confirmed the viability of the bottom up concept in managing services. Community Budgets turn the traditional top down model of service delivery on its head. Decisions on how to spend the single pot of money are taken at local level in the light of local conditions. Whitehall officials no longer issue guidance about how to respond to issues and policy making is carried out locally. These changes will allow the multi skilled teams to work across organisational boundaries and to find innovative solutions to the issues they are tackling.
The CBI believes that the shift in policy from privatisation to the Big Society’s is the wrong policy adopted for the wrong reasons. Deputy Director-General Dr Neil Bentley said: The Government has allowed urgently-needed public service reform to be derailed by “forces of inertia,” and gives the impression of “having lost its way, uneasy about reforms and unsure about how to present them.” He added: “Competitive tendering leads to cost savings of between 10 per cent and 30 per cent, with no adverse effect on service quality, and often improvements. Outsourcing has helped the UK develop one of the most advanced public services industries.”