Lessons from the UK: why bureaucrats need space to fail

“We have killed forever the seductively comfortable myth that you cannot get more for less. You can. More for less. Better for less. We’ve proved it again and again.”

So argued Francis Maude, Britain’s Minister for the Cabinet Office and Paymaster General, at a recent speech for the Royal Society for the encouragement of Arts, Manufactures and Commerce. Perhaps unsurprisingly, he is effusive about the impact public service mutuals and joint ventures are having in the United Kingdom. Since the Cameron government came to power in 2010, the number of public service mutuals in England has increased from nine to over 100. Many of these have been “spun out” from previously government-owned agencies.

Maude (pictured), who is responsible for civil service reform, recounted a favourite story demonstrating the strengths of the freedom enjoyed by mutuals. A homeless man with leg ulcers needed hospital treatment, and would have ended up having the limb amputated if he didn’t receive care — but he wouldn’t go into hospital because his only companion was his dog, and he didn’t have the money to have the dog put into kennels. Maude recalled:

“So [mutual] Inclusion Healthcare wrote a cheque for £200 or whatever it cost to have the dog vaccinated and put into kennels. He went into hospital, had his ulcers treated, and he’s fine.

“They just say: ‘if we’d still been in the NHS, we could never have done that without endless process, bureaucracy and auditing. Which budget does it come out of and how do we account for it? It would never have happened. But the result is a man with two legs instead of one, without being dependent on massive disability support for the rest of his life, not having had a very expensive amputation operation — and being happier.”

The UK government, facing ongoing fiscal pressures, has laid plans to make £10 billion of savings from efficiency and reform measures for 2017-18, and £15-20 billion for 2019-20. Maude insists the government can both cut and improve services at the same time.

He recalled how at the beginning of her “economy drive” in 1979, Margaret Thatcher instructed Treasury to find £800 million in public spending cuts. When they managed that within hours, she immediately asked for a further £400 million by 9am the next morning. “She reasoned that if it was that easy to find £800 million then she clearly had not asked for enough in the first place,” Maude stated.

When he helped prime minister John Major write his “Citizen’s Charter” plan to improve public services, there was widespread scepticism in Treasury that you could improve the bureaucracy without throwing more money at it — an attitude he believes has changed today.

What’s driving UK service reform

Five themes have underpinned the Coalition government’s civil service reforms. The first, Maude said, is openness, “because being transparent builds trust, sharpens accountability and drives improvements. Taxpayers can see how their money is spent and people can judge how services perform. There are now 16,000 datasets on data.gov.uk, the UK’s open data portal.”

The second theme is tight control from the centre. When the Coalition came to power, it found some departments were paying up to 10 times as much as others for items like printer paper, and IT systems were not compatible with one another.

“There is no good reason for departments to pay different prices for the same goods and services or to refuse to share buildings. Treasury and Cabinet Office need to work ever more closely together as the government’s corporate centre.”

Third are moves to loosen control over how services are delivered. This was part of the rationale behind the government’s support for mutuals and joint ventures — giving those who know how to do the job the space to do it. Such new organisations also help in solving the long-time problem of collaboration by drawing grants into structures better equipped to deal with certain problems, rather than just forcing traditional departments to work together — a process he admits often ends with deadlock and disagreement.

Mutuals are helping lead a re-vitalisation of public services in some areas, argues Maude.

“The results are dramatic. Waste and costs are down, while staff satisfaction is up. Staff absenteeism — a quick barometer of morale and productivity — is falling.

“Professionals are in the driving seat. When I ask people in these public service mutuals whether they would go back to working for the council, health authority or other authority, the answer has always been a resounding ‘no’. ‘Now we can actually do things’, I get told.”

Maude also believes outsourcing has gone too far in some areas — IT in particular — stating that over the next few years the UK’s bureaucracy would be bringing more skills back in-house.

“The alternative may not always be conventional outsourcing, as it was in the past. Instead, we are supporting alternative delivery models. The old binary choice, between services delivered in-house by monolithic public sector monopolies and red-blooded commercial privatisation or outsourcing, has gone forever …

“Those old IT contracts outsourced too much. We lost too much ability to do things ourselves.”

Reliance on a few multi-nationals has led to inflated prices and slow service in some cases, so the government hopes to use more locally-based small and medium enterprises in purchasing. The government is still over-prescriptive in procurement, though, he thinks, arguing there is too much of the “how” and not enough focus on outcomes.

“There are still a lot of myths about procurement. The myth is you’ve always got to choose the cheapest. Not true. You can never take into account the track record of previous providers. Not true.”

Fourth is a focus on digital — making it faster, simpler, more convenient for the public and cheaper. This involved axing individual departmental websites in favour of a single portal at gov.uk. One plank of this is transforming 25 of the busiest transactional services to be digital by default.

“Five years ago Britain was regarded as a by-word for crap government IT. Expensive, lots of failures, all that … We have come a long way in that time.

“Our mantra has been people should expect to have at work technology at least as good as they have at home. It doesn’t sound like that demanding a thing, but it seems for most people actually in government like a pipe dream. We’ve just done it in the Cabinet Office and it’s fantastic. And cheaper — it’s less than half the cost of what it replaced.”

Planning for spectacular failures

And fifth, public servants need to be given more space to try “sensible” new ideas, even if they don’t work out. Maude suggests taking lessons from Silicon Valley’s “fail fast” motto, or Israel’s so-called “start-up nation” approach. Key to this is that allowing for failure also helps in recognising when a project is not doing well, meaning bad programs can be killed. In turn, lessons are learned for the future.

One example Maude gives of a “best failure” is an award he gave to the Land Registry Property Alert Team.

“In March, they launched an award-winning property monitoring service. This allows people to sign up to monitor properties and receive alerts if, for example, an application is made to change the register. Just three weeks before the proposed launch, the team faced critical feedback from staff and users.

“Rather than plough on they went right back to the drawing board. The reworked design was a runaway success, attracting over 12,000 users, excellent customer feedback and an IT Innovation in Business Award.”

This year Prime Minister David Cameron appointed the first ever chief executive of the civil service, charged with accelerating and overseeing the efficiency and reform program. Cross-departmental leaders covering commercial and procurement, digital, human resources, property, major projects and communications report to the chief.

“This gives him the ability, through these teams, to build talent in these functional fields inside departments, including through overseeing recruitment and managing careers.

“Achieving £20 billion of further efficiency and reform savings for 2019 to 2020 will require very substantial commitment and drive from ministers and officials at the centre and right across departments. Our approach over the past four years was to forsake the usual big bang white paper, and instead to identify best practice and replicate it. We had no place for advisers who say ‘I can see that this will work in practice but it won’t work in theory’. This approach has paid dividends. It’s what I call the JFDI school of government — just do it.

“A different picture of Whitehall is emerging. It’s one where the day-to-day running of frontline services is pushed as far away from the centre as possible, putting real power and responsibility into the hands of public servants. The centre of government will be a far more unified and integrated operation. Back office services will be shared between departments. More policy will be developed outside of Whitehall and pooled policy teams will work to several secretaries of state.

“There is a lot of hard work coming over the next few months and years — but more importantly a lot of hard thinking. We will need to reimagine the role of the state in providing public services. It will mean doing more, doing it differently, doing it better, doing it for less. And it will never end. This will always be a work in progress. There never can be a steady state. There has to be continuous progress. The public, for whom public services exist, deserve nothing less.”

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