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The Coalition Government has been trailing a major overhaul to public service delivery for many months as part of its Big Society and “localism” agenda. It’s aim is to reduce the role of Whitehall in the commissioning, planning and delivery of public services across the country. In the Modernising Commissioning Green Paper, the Government stated ” …. these reforms are fundamental to achieving the Power Shift, to which this government is committed, transferring power away from central government to local communities.”

Before the Prime Minister’s speech, the Independent predicted scaled back rather than the bold initiatives that had been expected before the NHS pause. It expected there to be no new enabling legislation with, instead, each arm of Government establishing it’s own framework and initiative – much like the free schools and academies programme for education.

In earlier announcements, Francis Maude said no additional legislation was required to allow mutual organisations to bubble-up spontaneously. Change would come from energy and drive of local stakeholders rather than a programme of central change and control. However the barriers for employees and employers to an effective bottom-up change solution seem no closer to resolution.

David Cameron’s statement that diversity in supply will be “the default” and the public sector will have to justify providing services in-house is a bold one, though the method and approach to deliver this in practice seems somewhat obscure. There is scant detail on HOW the Coalition Government plans to deliver and support the change it wants to see take place.It will be important to see how the government takes the agenda forward with the measures that were described by Maude in the following Commons statement -

• strengthening accountability by a radical programme of transparency for government and the public sector
• unlocking innovation by removing barriers to entry, stimulating entry by new types of provider, and unlocking new sources of capital
• ensuring public sector providers can hold their own by liberating public sector bodies from red tape
• encouraging employee ownership by promoting mutualisation and employee cooperatives
• ensuring service continues if particular service-providers fail with effective continuity regimes established service by service.

The White Paper does provide a comprehensive, consistent and coherent approach to delivering public services in a different way. Many people would agree with the suggestions that Choice, Fair Access and Accountability are important though fewer are likely to welcome increasing Diversity (because of the fears of damaging privatisation) and many will be worried about Decentralisation at a time when local services are being hit hard by spending cuts.

So does the White Paper provide shafts of light for the future or is it just too difficult to see the wood for the trees?
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The Coalition Government has expressed a clear objective of creating “a mixed contractor economy” that will deliver greater competitiveness across the public sector. Their aim is to drive efficiency and value for money and stimulate innovation in how public services are provided.

In certain respects, the Coalition Government is reducing the “safety measures” that helped public servants make a comfortable landing when they left employment of the government and its agencies.

As part of its overall aim of encouraging public sector organisations to be “spun out” into mutuals, co-operatives, charities and social enterprises, steps are also being taken to reduce the obligations of these organisations to match existing public sector employment terms.

In December 2010 the Government announced its withdrawal of the Code of Practice in Workforce Matters in Public Sector Service Contracts. This Code of Practice required organisations which had accepted employees transferred from the public sector to offer new recruits employment terms which were no less favourable than those of transferred employees.

With this restriction removed, organisations providing public services will no longer be perpetually locked into employment arrangements inherited from the public sector. The indications are that the similar provisions covering Local Authorities are likely to be similarly withdrawn and this will also impact on NHS bodies and their partner organisations.

Unsurprisingly, the CBI welcomes this development, though, no doubt it will raise serious concerns with public sector unions – who saw this code as a major achievement in their discussions with the Labour Government. There is no suggestion the government plans to reduce employment rights under TUPE legislation and employees who have benefited from earlier arrangements remain “protected” – but future transfers will face fewer constraints on their ability to take on services previously delivered by public service organisations.

In March 2011 the Government then announced new consultation on the requirement to provide broadly comparable pensions for staff transferring from the public sector into new employers. It repeated the finding of the Independent Public Services Pensions Commission that the existing public sector pension structures and the requirements to provide broadly comparable pensions were acting as a barrier to non-public service providers.

It’s clear now the Government does recognise the need to address pensions matters discussed by Attractor previously in its aim to encourage innovation and a mixed economy. It is also obvious it prefers not to remove the barriers by opening up public sector pension schemes to new organisations – a signal that will not be lost on public servants or their union representatives.

The NHS White Paper, “Equity and Excellence: Liberating the NHS”  represents the completion of a devolution journey the NHS has been undertaking for over a decade. Moving all service providers either to Foundation Trust status or to one of a number of social enterprise models, it effectively de-nationalises NHS organisations.

In future, NHS services would be delivered through a wide range of diverse organisations – based on different legal frameworks and working in different ways.

When it comes to workforce issues, most people are currently focusing on the impact on those involved in commissioning, planning, inspecting, monitoring and managing the NHS. Staff losing jobs, reassigning function to new GP consortia, possible TUPE transfers and skills retention challenges.

But what does all this mean for the workforce delivering care? When the dust settles, these are the people we rely on to maintain high quality patient experiences.

While it might feel a little early, it’s worth considering what the provider organisations emerging from the shake up might look like. Read the rest of this entry →