Is public-service commissioning faulty by design?

How government commissioning is failing

Earlier this week (23 January 2017), Reform Think Tank published a new report criticising public sector commissioning.

Faulty by design: the state of public-service commissioning argues that the current commissioning framework is complex, suffers from unnecessary duplications and is largely ineffective.

Who are Reform?

Although Reform emphasise their political independence and the fact that they are a charity, it seems fair to say that they have close associations with the Conservative Party – they were founded by a Conservative MP and their current director, Andrew Haldenby, worked in the Conservative Research Department and is a regular contributor to the popular Conservative Home blog.

It’s quite common for Reform to advance views in keeping with the latest thinking among Conservative-minded politicians and thinkers. The links between Reform and criminal justice are particularly strong at the moment as Justice Secretary Liz Truss used to be its Deputy Director.

Themes

As a right-wing Think Tank, Reform is a strong supporter of the privatisation of public services claiming that:

Today, virtually every part of the public sector benefits from market mechanisms.

However, it also notes that privatisation and the purchaser/provider split has led to an extension of commissioning responsibilities and frequent changes to the commissioning framework. The government’s aspiration has been to deliver integrated services that address the complex needs of service users in the most effective way – in many instances through devolving power to local commissioners to design services to meet the different needs of local populations. Major recent reforms include the creation of Clinical Commissioning Groups in 2012 to commission secondary healthcare. The same year, Police and Crime Commissioners were introduced to be held accountable to local areas for tackling crime. More recently, government has devolved health, social-care, welfare, skills and elements of the criminal-justice budgets to Greater Manchester.

The report argues that commissioning bodies are not delivering value for money in three key areas:

  1. Commissioners are failing to focus on outcomes that matter to service users. Service success is measured by output (such as the number of hip operations delivered) and inputs (the cost of each operation) rather than outcomes (sense of wellbeing). Commissioners feel they do not possess the skills to design outcomes-based contracts and a risk-averse attitude to failure is a barrier to commissioning for more abstract goals.
  2. Fragmented commissioning bodies stand in the way of integrated services that meet users’ needs most effectively. Ambiguity of responsibility for designing services leads to gaps in delivery. In other instances, services are duplicated, with HM Treasury putting the cost of similar interventions being delivered at £100 billion in 2010. Prevention is undermined where commissioners are not responsible for the failure to stop issues – such as illness or crime – occurring.
  3. Devolution of commissioning to local areas is not happening in practice, with a one-size-fits all approach creating a postcode lottery across in healthcare, welfare-to-work and probation services. The UK remains one of the most centralised advanced economies. Whitehall commands dictate spending in areas such as healthcare, despite local commissioning bodies being designed to deliver locally tailored care. This is undermining the transformation and integration of public services. Other central aims create perverse incentives, with central targets dictating the actions of frontline professionals.

Reoffending

The section of the report which deals with reoffending notes the different levels of support with the key issues of employment, accommodation and education and training for released prisoners:

As you can see, these figures are not linked to the prosperity of different regions with employment rates poor in London despite the best economy in the country and accommodation support average despite housing shortages being most acute in the capital.

The report applauds the decision to devolve more commissioning powers to prison governors but notes the concerns expressed by many that there will be a tension between this approach and the strong history of centralised control from the National Offender Management Service. (As a side note, it is widely rumoured that Liz Truss is more than a little bemused at the role of NOMS, having come from Education where the Department decides and implements policy without the need for an intermediary body.)

Conclusion

It’s hard to disagree with this analysis by Reform of what’s wrong with current public sector commissioning (although there is no mention of the problems caused by the very substantial disinvestment in public services over the last seven years).

However, the report does not seek to suggest a way forward although promises to provide a blueprint for the design of a new commissioning framework in forthcoming reports.

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