The Week

The Year 2023

Charlotte Pickles
Director

As 2023 draws to a close, the Reform team have a final gift for readers for The Week — ‘The Year’. It was, again, a year light on policy and heavy on politics.

The year started with a series of machinery of government changes, baffling many, as the PM decided to create a new department (DSIT) and rejig others (DBT & DESNZ); the SNP facing a criminal investigation into the Party’s finances; and Labour announcing its 5 missions. In Spring, Matt Hancock’s WhatsApp messages were released; the Privileges Committee found Boris Johnson misled Parliament, leading to his early Summer resignation as an MP; Dominic Raab resigned as Justice Secretary in response to an investigation into allegations of bullying; and Sue Gray announced she’ll be joining the Labour Party as LOTO’s Chief of Staff. You remember all that, right?

Parliamentary constituency boundaries were withdrawn; a series of scandals led to 7 by-elections; 3 councils issued section 114 notices declaring themselves bankrupt; the second leg of HS2 was scrapped; NHS waitlists continued to rise and a million appointments and a billion pounds were lost to NHS strikes; and Rwanda sucked up far too much political capital and airtime, so I won't waste more here.

Enjoy our summary of The Year below, and from everyone at a Reform, we wish you a very happy Christmas.

 

💬 QUOTES OF THE YEAR:

“There was an assurance that plans were in place to manage it, and in hindsight…those plans should have been interrogated more carefully by me and at the Cabinet level”

Lord Mark Sedwill, former Cabinet Secretary and Head of the Civil Service, giving evidence to the UK Covid-19 Inquiry

 

“I don't want to get into quality life assurance models”

Mr Keith KC, Lead Counsel to the UK Covid-19 Inquiry, to Prime Minister Rishi Sunak (QALY stands for Quality-Adjusted Life Year, and is used to assess the value of clinical interventions)

 

“To be honest, this comes up periodically. We always find it slightly odd when it does”

Amanda Pritchard, CEO, NHS England, giving evidence to the Health and Social Care Committee, in response to being asked about Reform’s finding that the acute follow up appointments waitlist is 11 million

 

“A Labour government will not waiver from iron-clad fiscal rules”

Rachel Reeves, Shadow Chancellor, addressing Labour Party Conference and setting out Labour’s commitment to sound finances

 

“The Cabinet Office is a uniquely dysfunctional organisation”

A former permanent secretary, quoted in Reform's 'Breaking down the the barriers' report

 

“No one is in charge of the civil service”

Lord Francis Maude, speaking at a Reform event ahead of the publication of his independent review

 

🔢 THE YEAR IN NUMBERS

60% — how much bigger the disposable income of the average American household is compared to the average British household.

11 million — the size of the acute follow up appointments waitlist

150,000 — the number of vacancies in social care, more than the number of doctors in the NHS

86% — the proportion of Brits think the NHS is in a “bad state”

2,084,000 — the number of working days lost due to strike action in the public sector between January and October 2023

28% — the proportion of Millennials who think the government should reinstate lockdown

7 — the number of parliamentary by-elections

83 — the number of MPs who have so far announced that they will not be standing for election again

🏆 REFORMER OF THE YEAR

Rt Hon Andy Burnham
The Mayor of Greater Manchester has done a lot this year to demonstrate the potential for Combined Authorities to become a catapult for innovative policy thinking. You don’t have to be a fan of everything he is proposing to recognise the amount of energy he has injected into the local and national policy debate.

In 2023 Manchester launched its ‘Bee’ integrated transport network, which will ultimately incorporate bus, tram, cycling, pedestrian, and commuter rail services, all working to foster public health and reduce emissions. Burnham also kicked off a policy debate — and raised some hackles in Whitehall — with his plans this year for a new education pathway, the Manchester Baccalaureate (or MBacc), a local technical equivalent to the more academic English Baccalaureate.

We were delighted to host the Mayor twice at Reform events, and you can watch him in conversation with our Policy Director Simon Kaye and West Midland Combined Authority CEO Laura Shoaf, on the day the second leg of HS2 was cancelled…

🏆 REACTIONARY OF THE YEAR

UK Covid-19 Inquiry
Two and a half years after the final pandemic measures were lifted, we only have another three plus to wait for the Inquiry to conclude. I am sure the next crisis will have the good grace to hold off until we have the findings. But even then, will we have learned the lessons necessary to put us on a firmer footing next time round? Not judging by the public hearings so far.

The QALY quote in our ‘quotes of the year’ captures the problem. Throughout the latest module of hearings on ‘Core UK decision-making and political governance’, rather than seeking to fully explore the complex decision-making processes, and the infrastructure in place to enable options, trade offs and unintended consequences to be explored, the focus appears to be on skewering those involved. In times of crisis, and especially one involving a novel disease, ministers and their advisers should be debating every scenario, interrogating assumptions, and weighing impacts and risks. They should be open to testing — and rejecting — different approaches, and to changing direction when new evidence is presented. Yet you wouldn’t think that based on the lead counsel’s questioning — in fact you would think such behaviour bad.

Different personalities will be in place next time round, possibly better suited to crisis management, possibly worse, but whoever they are, let’s hope they reject this hindsight-framed, performative blame game.

👎 Bad for

Smoke and mirrors
Chancellors are known for pulling rabbits from hats, but this year Jeremy Hunt has really embraced his role as magician.

In the Autumn Statement we were told the Government is delivering the “biggest package of tax cuts since the 1980s”. The 2p cut to national insurance will indeed benefit 27 million workers, but against a backdrop of taxes increasing for over 80% of households. ‘Fiscal drag’ is in fact increasing the number of people paying tax or a higher rate of tax and the overall amount of tax they pay.

We also saw that old favourite, the ‘fiscal headroom’ trick, deployed. Both the Spring Budget and Autumn Statement saw the Chancellor magically find the cash for tax cuts and spending pledges. As the OBR pointed out, the Spring Budget left only £6.5 billion for the Government to stay within its fiscal rules — the smallest amount any Chancellor has set aside since 2010. Meanwhile the Autumn Statement’s package of measures, the third costliest since 2010, were premised on headroom that had increased by around £14 billion in a matter of weeks. And, as we pointed out in our snap analysis, ‘headroom’ — the gap between the fiscal rule you set yourself and the expected outturn — isn’t real money.

👍 Good for

Playing to our strengths
It’s been a good year for the UK consolidating its position in key, high-growth sectors — notably AI and the life sciences.

The year began with a government white paper for AI, promising a “pro-innovation” approach to regulation which. The UK then played host to a global AI summit, bringing together leading tech companies and policymakers to promote greater cooperation on AI safety. And between the Autumn Statement and Spring Budget, over £1.4 billion was committed to boosting the UK’s ‘compute’ power, key infrastructure for the development of AI. The Government has also established an AI Incubator in Cabinet Office, aimed at accelerating the adoption of AI across Whitehall.

In life sciences three developments in particular stood out: a £650 million “war chest” announced in May to attract investment and promote innovation in drug development; Lord O’Shaughnessy’s major review into the landscape for clinical trials, with many of the recommendations immediately accepted by the Government; and over half a billion pounds committed to life sciences manufacturing in the Autumn Statement.

All in all, a welcome boost to two of our most innovative, high growth potential sectors.

Building local autonomy (in some places)
This year, Reform hailed the landmark ‘trailblazer’ devolution deals in the West Midlands and Greater Manchester as “arguably the most radical shift in local government policy since the 1970s”. These deals commit to a department-style funding settlement for each Combined Authority (we’re waiting on the detail) and, promisingly, the Government has since clarified that similar powers will be possible elsewhere as other Combined Authorities build the capacity to take them on. Meanwhile, there are efforts underway to streamline funding for local government and make it operate more flexibly.

Even in the context of an exceptionally difficult year for many councils’ finances, a major shift in England’s distribution of power seems set to play out, with big opportunities for locally-tailored and innovative policymaking. As Reform said back in 2017 'Viva la devolution'!

Planning for the long term
The NHS Long Term Workforce Plan was the first of its kind in the NHS’s 75-year history — which alone makes it a significant moment of 2023. The Plan is oriented around three core themes: train, retain, and reform, and commits to a litany of different policies. These vary in their deliverability and effectiveness: expanding apprenticeships (good in theory but not always borne out in practice), doubling medical and adult nurse training places (expensive but much less expensive than temporary staff), and reducing the length of medical training (step in the right direction but may not go far enough). Crucially, Reform believes that in order for the health service to remain sustainable, the service needs to shift to a model of health creation — an ambition clearly echoed in this plan. Expansion of personalised care roles, such as social prescribers and peer support workers, is also a step in the right direction. Similarly, targets for more staff in mental health, community and primary care roles are promising.

However, as we highlighted at the time, the plan rests on some ambitious productivity assumptions. If the NHS is to become more productive, workforce reform must be partnered with significant investment in buildings, equipment, IT, and digital infrastructure.

In a political world where long termism is the exception not the rule, a comprehensive, forward look of the NHS workforce is welcome. Let’s hope to see more movement on a workforce plan for the increasingly understaffed social care system.

🐓 Coming home to roost
This year has seen three more councils issuing section 114 notices, declaring bankruptcy — taking the total to nine. Financial mismanagement, risky commercial investments and, of course, spending cuts and rising demand have all contributed.

Previously, the Audit Commission was responsible for ensuring independent audit of local government finances. In 2010, it was abolished with the expectation of over £1 billion in savings by outsourcing audit to private firms. However, according to the Redmond Review, “the ambition of attracting new audit firms to the local authority market has not been realised”.

This year, 99% of English councils missed the sign-off deadline for their 2022-23 financial accounts. And local audit completion for the year before has only reached 27%.

This mammoth backlog severely hampers councils’ ability to make informed budgetary decisions, assess value for money in public spending, and embed learning into practice. It also prevents the detection of risky behaviours and poor financial management. That ill-advised decision over a decade ago has come home to roost.