The Week, 19 January 2018
There are two must-read reports on Carillion this week. In 2008, DeAnne Julius’s review of the outsourcing industry found that the introduction of competition had reduced prices by 10-30 per cent without impacting quality. Last year, Professor Gary Sturgess found that government had made it much harder to realise these benefits, with a key reason being a wish to let contracts at unrealistic rates.
Andrew Haldenby, Director, Reform
Reformer of the week
The Financial Times, for its balanced commentary on the role of private sector companies in delivering public services all week (please see quote below).
Reactionary of the week
Rt Hon Matthew Hancock MP, who argued that BBC staff should not receive higher salaries than the Prime Minister. The BBC is an independent institution which should determine salaries according to the value staff deliver, not arbitrary political limits.
Good week for…
Clarity on PFI
On Thursday, a report by the National Audit Office found that the public sector may struggle with understanding the costs of PFI projects. While public sector organisations work on a five-year budget cycle, PFI costs can run for up to 30 years.
On Thursday, among various reports this week on the potential benefits of AI, Cambridge University reported that it had helped researchers identify a drug to combat malaria.
Bad week for…
On Thursday, Jeremy Corbyn pledged to bring back under public-sector management all central government and local government contracts, except in exceptional circumstances.
On Friday, the NAO found that the NHS had spent funds earmarked for “transformation” on day-to-day pressures in hospitals instead.
Quotes of the week
“The real political battle is over whether the private sector should be running public services at all. But from roadworks to rubbish collection, private provision is pervasive and usually unproblematic. There is no reason to believe government would do better. Rather than stop buying services from the private sector, it must become a more canny customer. The civil service — which values policy generalists — is often very bad at specifying what it wants and managing contracts. Ministers who change policy on a whim and skip between departments do not help.”
An FT leader on Friday.
“The NHS has received extra funding, but this has mostly been used to cope with current pressures and has not provided the stable platform intended from which to transform services. Repeated short-term funding-boosts could turn into the new normal, when the public purse may be better served by a long-term funding settlement that provides a stable platform for sustained improvements.”
Amyas Morse, head of the National Audit Office, speaking today.
On Thursday, Alexander Hitchcock, Research Manager at Reform, identified opportunities to refine the procurement process to ensure the future success of public-service contracts.
On Friday, Andrew Haldenby argued that if extra spending is to be devoted to the NHS, it must be targeted on reform efforts.
AI in health report
Reform’s recent publication, ’Thinking on its own: AI in the NHS’, authored by Eleonora Harwich and Kate Laycock, received a response from NHS Digital’s Director of Data, Professor Daniel Ray. He commented on the report’s recommendations regarding the need to get data right if artificial intelligence is to be used in health care.
It was also covered in several media outlets including:
On Sunday, Andrew Haldenby appeared on BBC Sunday Politics West to support the NHS’s efforts to get greater value for money from its property estate.
On Tuesday, Alexander Hitchcock appeared on BBC’s Victoria Derbyshire show to argue in favour of a new model of care for the NHS.
On Thursday, Alexander Hitchcock appeared on Sky News to discuss the future GP workforce.
On Tuesday, Alexander Hitchcock appeared on BBC Wiltshire to discuss the benefits of public-private partnerships after the news that Carillion went into liquidation.
Also on Tuesday, Alexander Hitchcock wrote a piece in City AM arguing that the collapse of Carillion should not mean an end to outsourcing.
Next Tuesday, Reform will host a roundtable, led by Anneliese Dodds MP, Shadow Treasury Minister, to discuss how the Treasury can design a tax system to ensure long-term funding for public services.
Next Friday, Reform will be hosting an event on the role of universities to promote social mobility with:
- David Lammy MP, Labour Member of Parliament for Tottenham.
- Anne-Marie Canning, Director of Social Mobility and Student Success, King’s College London.
- Dr Tim Bradshaw, Chief Executive, The Russell Group.
- Professor Vikki Boliver, Director of Research—Professor and Deputy Head of School, School of Applied Social Sciences, Durham University.