The RSA 2020 Public Services team welcomes the launch of ‘A new conversation in Kirklees’, a new report by the Commission on the Future of Local Government endorsing Kirklees Council’s It’s Time to Talk programme.
Public engagement is too often narrow in scope, confined to consultations and formal meetings. It reinforces perceptions of the Town Hall as an ivory tower, distant from the lives of ordinary people. But when done well, involving citizens on an equal footing can build trust, unlock community capacity and help public services find collaborative solutions to complex challenges.
It is here that Kirklees Council’s It’s Time To Talk initiative shows real promise. All too aware of the multiple pressures facing local services, the council is beginning to lay the foundations for a new and more equal relationship with its residents. But It’s Time To Talk is more than just a platform for discussing budget cuts and public service institutions. It is more ambitiously seeking to use the place-based community leadership role of the council to nurture and practically support the social aspirations of its citizens.
This is fresh and exciting territory. But translating a more productive and empowering space for civic dialogue into a new model for public services comes with strategic challenges. Our concept of social productivity calls for public services to be shaped by relationships rather than transactions and be judged by the degree to which they help citizens and communities achieve the outcomes that matter to them.
We argue that putting this into practice needs a strategic change process that marries public engagement with community leadership and new ways of council working. This may include new approaches to commissioning; more creative public spending; stronger cross-sector partnerships; and a public service infrastructure that is better able to manage demand and meet long-term challenges through a new and better settlement with citizens.
We hope that Kirklees Council is able to build on the momentum of It’s Time To Talk to unlock the social resources of its communities and the dynamism and creativity of the public, private and voluntary sectors to begin to build a sustainable, socially productive settlement for public services.
Paul Buddery is a partner at RSA 2020 Public Services. He tweets on @buddypb
The RSA 2020 Public Services has a vision for public services that we call ‘social productivity’. Boiled down, it rests on three key propositions:
- That value in public services is created through relationships: between citizen and service, formal and informal resources, private business and public institutions;
- That public services should support individual capabilities and social resilience over the long term, not patch-and-mend failures in the short term; and
- That locally crafted and democratically owned public service strategies should be part and parcel of building economically productive as well as socially productive places.
It’s a vision we first shared back in 2010, when it was developed as the central insight of the Commission on 2020 Public Services. Change was in the air, and a fresh-faced Coalition was drawing up plans for Open Public Services that would see numerous services ‘spinning out’ of public control and ownership and into the control and ownership of their staff.
The new public service mutuals would unlock ‘untapped entrepreneurial drive’, bringing much needed efficiency and diversity to the supply side. While some questioned why the Coalition’s appetite for mutuals did not appear to extend to business more broadly, and unions expressed anxiety about terms and conditions, change had, in fact, begun under the previous administration, so stepping up the pace of mutualisation was generally welcomed as a promising development. Certainly, the 2020 Commission report which introduced social productivity was upbeat about spinning out: ‘If taken forward on a large scale, these changes could constitute a radical, positive move towards citizen and professional ownership in the services they deliver and consume.’
So how has public service mutualisation progressed? And is it still in step with our vision of socially productive public services? Through our partnership with the Transition Institute, we’ve had an inside seat on change in four London Councils. Our Enterprise Solutions programme supported by London Council’s Capital Ambition has gathered learning from library, youth, communications and social care services. We launched its final reports this week, along with an animation that directly answers one of the research findings – namely a low level of awareness among frontline public servants of social enterprise options and understandable staff bewilderment when the process gets underway and the jargon begins to fly. The animation is an accessible way of kick-starting plain-speaking conversations.
But from a social productivity perspective, are these conversations worth having? From what we now know, is the march of the mutuals a good thing or a bad thing? The most obvious thing to note is that the march has been a good deal slower than the Coalition had envisaged. As the chair of the Mutuals Taskforce recently conceded, ‘a complete mutuals revolution is not yet upon us’.
This matters because part of the promise of mutualisation was that it could unsettle the private and public incumbents that dominate public service provision, generating value by blending skills, cultures and resources from a variety of sectors. Yet while mutuals are expanding slowly, outsourcing of public services to established private sector companies is surging forward at an unprecedented rate. The value of government contracts to the private sector has doubled in four years to £20bn. What’s been termed a ‘Shadow State’ of private providers has grown in size and strength.
For new mutuals, this has practical implications for entering the market for public services. Our Enterprise Solutions research suggests that in some circumstances, a joint venture with a well-established private – or indeed voluntary – organisation can be a smart move for fledgling mutuals in order to enter the market and access capital and specialist expertise. But there is clearly a risk that the new organisations lose distinctiveness, and that mutuals become a politically helpful veneer to crudely marketised public service provision.
This is a significant risk. Some may think that it’s a risk not worth running for the sake of a process which is – at best – resource intensive and challenging for the spin-out service and its parent authority. But as Tim Cooper of Accenture pointed out in last week’s guest blog for 2020, social enterprise solutions – partial spin-outs, partnerships, in-house trading companies – are gathering pace, and are not simply a veneer to cover incumbent interests. There are many creative solutions that go with the grain of local expertise and culture.
As we heard at the launch event for Enterprise Solutions, mutualism -and the wider hybrid family now growing around it – can give local authorities and other public bodies confidence that change and improvement are possible. They are helping local authorities and other public bodies to think much more creatively about their economic roles – not only in terms of providing employment, but also in supporting skills, opportunity and entrepreneurialism. We know that in local authorities like Sunderland, staff are actively supported to consider setting up in business, potentially through spinning-out, but equally through setting up new enterprises beyond the public sector.
Mutuals, in other words, could be one of the ways in which public services play a smarter and stronger role in supporting sustainable local economic growth. Local authorities in particular will need to find ways to link their labour market and skills policies with encouraging business creation from within their own staff.
Against two of the three social productivity criteria, then, public service mutuals today still seem to be positive – though vulnerable – players in public service reform. They could help bring sustainable economic and social development together; and they could accelerate the growth of hybrid organisational forms, drawing from a variety of sectors, institutions and networks. But how do mutuals measure up against the remaining social productivity criteria, that is, the need to shift our public service interventions away from failure response and towards long term resilience and capabilities?
The signs are mixed. Working closely with communities and service users, some mutuals have developed packages of support that respond to the strengths and needs of the whole person and their wider community. But more often mutualised services have not had the ability, nor perhaps the inclination, to radically redefine their offer.
Ultimately, as players in a market, mutuals can only create interventions that commissioners are willing to buy. Under the last government, the voluntary sector won a greatly expanded role in the provision of public services. But the sector was not encouraged or allowed to renew the type of services that were delivered. Public services changed hands, but barely changed in nature. If we want mutuals and other social businesses to develop their full social productivity potential, political leaders and public service commissioners will have to involve them in creating a radically different model of public services.
Paul Buddery is Partner at RSA 2020 Public Services. He tweets at @buddypb
This is a guest post by Tim Cooper FRSA, senior manager and research fellow at the Accenture Institute for High Performance.
Social-value hybrids are an increasingly common feature on the UK public service landscape. These new entities encompass a broad range of organisational models — from mutuals and cooperatives to social enterprises, benefit corporations and industrial & provident societies — that are increasingly being spun out of the public sector as a way of reconciling fiscal austerity with rising citizen demands and the need for economic growth.
Why do we call them social-value hybrids (SVHs)? In researching these entities as part of a new Accenture report on hybrid public service delivery models, we have been struck by the fact that there is no single blueprint of success. As Mark Sesnan, Managing Director of Greenwich Leisure Limited (now trading as ‘Better’) put it to us, “there are as many organisational models in this space as there are individual companies.”
However, despite this diversity, SVHs appear to share five common characteristics: primarily, a social mission that guides decision-making at every level; autonomy from government but the delivery of a public service; a focus on the unmet needs of citizens, particularly from vulnerable groups; robust revenue-earning business models; and non-traditional enterprise structures, where profits are reinvested and employee ownership is common. In this way, SVHs focus on “what works” with capabilities and processes operating in service of their social mission.
The combination of these ingredients appears to deliver an appealing brew of both improved citizen outcomes and better economic outcomes, a central theme for Accenture’s global program, Delivering Public Service for the Future. For example, at Sunderland Home Care Associates, employee ownership contributes to an annual staff turnover of less than 5 percent, compared with an industry average of more than 20 percent in the United Kingdom. With continuity of care being paramount in such services, such statistics translate directly into better citizen outcomes. Furthermore, one study of employee-owned enterprises in the United Kingdom found that they generated employment growth from 2005 to 2008 at 7.5 per cent per year, nearly twice the 3.9 per cent growth rate of non-employee-owned enterprises.
However, if the early signs of promise are to grow into a permanent and more significant feature on the public service landscape, a number of enablers need to be in place. The following actions would provide a good place to start:
1. Adopt common standards: SVHs often struggle to attract investment. Banks can be wary of their unconventional organisational structures, and a potential skills deficit may hinder efforts to pitch successfully to investors. Mainstreaming common definitions and frameworks of “social return on investment” would help build a stronger case for public investment, while developing a private market would open up individual and institutional investment. Institutions such as Big Society Capital can help in this regard, but further ballast could be provided in the form of investment guarantee mechanisms (particularly at the early stages of SVH development).
2. Develop public entrepreneurship: the skills required to thrive in a SVH are hard to find. A commitment to a social mission must be matched by hard-nosed business acumen. Ensuring a pipeline of future skills must start early. Incorporating social entrepreneurship into school curricula is a step in the right direction. But beyond that, policymakers can target experienced public managers with “social sabbaticals,” using simulation exercises and gaming techniques to prepare them for a period of absence to test and launch their own social enterprises.
3. Incentivise smarter commissioning: SVHs often have difficulty breaking into new markets, given their size and (often) relative inexperience versus larger incumbents. But commissioning approaches need to recognise the wider networks and relationships that SVHs can foster within communities. As part of this, local councils may well need to enter into a more symbiotic relationship with their service providers in the form of secondments, management expertise or even infrastructure, both physical and technological.
4. Embed innovation in social-value chains: Creating innovation hubs that bring together public managers, social entrepreneurs and private-sector entrepreneurs operating in the same space can offer significant opportunities to start conversations, create synergies, and share best practices and innovation across the board. This interplay can be embedded in contracting and tendering mechanisms, introducing diversity of delivery provision in the rules of the tendering process. For example, requiring large-scale service providers to partner with third-sector organizations in service design and delivery can be a useful tool to foster the uptake of spinouts. Subcontracting—but perhaps more effectively co-creation—can enable the establishment of “social value chains” spanning across sectors. These social value chains would cement hybrids’ rightful place in the economy as drivers of economic growth and social benefits—the best of all worlds.
Tim Cooper FRSA is a senior manager and research fellow at the Accenture Institute for High Performance. He can be reached on firstname.lastname@example.org
RSA 2020 Public Services will launch a series of new report on public sector spin outs on Wednesday 29th May 2013. For more information please contact email@example.com.
There was policy among the politics in Wednesday’s Queen’s speech, although not all of it was necessarily pulling in the same direction. For political consumption the Government is offering a new clamp down on the rights of non-UK nationals to access our NHS services. Let’s see if it proves more consequential, or electorally satisfying, than the many clamp downs that have preceded it. On the policy side, the government is taking important steps to reform social care, capping individual liability for some costs, introducing new rights and prioritising early intervention support. The social care sector will need to grow and change radically in order to meet the aspirations behind the proposals. Whether this will be helped or hindered by restricting the ability of migrant social care workers – on whom the sector has been highly dependent – to access health services while in the UK has yet to be seen.
The kindest interpretation of events is that the Coalition is deliberately underlining that the way we’ve expanded our caring capacity as a society in recent years is unsustainable, fiscally and socially. We cannot continue to rely on professional services, often offering low-pay, low-prestige jobs, intervening at points of crisis or severe infirmity and offering relationships between carer and cared-for that are so tightly rationed that care itself struggles to keep a foothold. A high-quality care sector can only be part of the solution to living well in a silver society. A much larger role needs to be played in future by softer interventions that maintain wellbeing, respect independence and nurture social-interdependence across the life-course. With its stress on reducing people’s dependency on formal care services through earlier intervention, the Care Bill is a useful step in the right direction. But as a pamphlet we published this week argues, its attachment to needs rather than strengths may ultimately perpetuate a system in which rationing around individual thresholds distorts our overall social investment and can create perverse individual incentives and unfair outcomes.
We believe that the Bill should go further. At the same time, we believe that the onus for change doesn’t rest exclusively with the Government, or even local government. How we function as a society will need to change as who we are as a society changes. Work in support of the National Dementia Strategy is instructive and important in this respect, reframing a medical condition as a social challenge with implications for communities and employers, as well as health professionals and care services. In a paper that we published last year, Craig Berry struck some important cautionary notes; yet many of the opportunities for improving the lives of our older citizens lie outside of traditional services. For example, we are currently working with Asda to explore how they could operate in ways that generate greater social value. The amount of store space that will be needed for retail is falling, so what other functions could the store spaces provide? How could stores like Asda, in partnership with community groups or mainstream public services, create opportunities for isolated older people to come together, share skills with each other or with younger people, perhaps learning how to pool personal budgets in order to access care that they would value? We have also been working with the Scottish Environment Protection Agency and Scottish Natural Heritage to look at the role of access to high quality natural environments in supporting health and wellbeing throughout the life course. The importance of green space for healthy childhoods is now widely recognised, but designing healthy green space for active older communities is just as important, yet receives relatively little practical attention.
It’s unfortunate to see our older population routinely referred to as a burden, a timebomb or – more recently – the sharpest teeth in the LGA’s jaws of doom, threatening imminent financial breakdown. A whole-place, strengths-based approach doesn’t substitute fantasy for reality, but it is useful because it puts all of us in the frame.
Paul Buddery is Partner at RSA 2020 Public Services. He tweets at @buddypb
With a triple dip recession looming in the UK, it is increasingly clear that there is a need for fundamental reform of the UK economy. But there is little consensus about how to make this happen. The form of capitalism adopted by much of the West is predominantly based on the achievement of short term growth, with the banking crisis and the UK’s depressed economic performance arguably the result of short-term profit seeking with little regard for the longer term consequences. In the banking sector, retail banks have resorted to unsustainable tactics to make money from their customers, while the extreme financial incentives to increase profit in investment banking have led to dishonest dealings and collapsed markets. Likewise, on the high street, short term market incentives prompt grocers to squeeze their suppliers on cost while driving their customers to over-consume through carefully devised offers and by prompting impulse buying.
How can an economic recovery take place in the context of such unsustainable market forces? The policy response has not proved very helpful. When these sustainability problems arise, the usual government response is to reach for new policy levers, regulation or sanctions. Sometimes industry captains get together to try to find an answer. In conference after conference, people discuss the change that needs to be seen, usually to little effect.
One of the problems is that incumbent players in an industry cannot alter their ‘basis for competition’ and no amount of top down pressure can change this. Professor Clayton Christensen of Harvard Business School explains in his research that innovation within an industry normally takes place to achieve incremental change rather than transformation. So transforming a market is extremely difficult. As a result, unsustainable factors which are inherent to industry models actually grow with the market themselves to become larger and larger challenges to society as a whole.
This is not just a private sector problem. In the UK, demand for healthcare has grown by four per cent every year since the inception of the NHS. Between 1997 and 2007, the NHS budget grew from £44bn to £96bn. This is 225 per cent more growth than the FTSE 100 index and 170 per cent more than GDP growth over the same period. The reason is that it is in hospitals’ interest to supply more services, even though they are a publically funded good. Yet this level of inflation in healthcare costs is definitely not sustainable, and represents a global challenge in the coming years. The incentives are backwards.
However, an anomaly to this is the technology sector. Unlike many other sectors, this industry consistently transforms itself, altering not only its own business models but also transforming how society functions. Why is this? Let’s consider some of the factors:
- The sector takes its inspiration from visionaries who have developed globally transformative solutions, starting from their garage. As Steve Jobs put it, it is the ones who are crazy enough to think they can change the world who usually do.
- Technology communities are well connected, allowing knowledge and communications to travel quickly, and enabling ideas to develop into solutions.
- The tech industry has enjoyed a disproportionate share of the global venture capital spend.
- Platforms such as Windows, Apple, and Google Android are making it easier for many people to develop applications for a mass market.
- Governments and organisations have set up technology hubs for entrepreneurs to test and grow their solutions.
For these reasons and many others, it has been possible for new people to enter the market and transform it from the bottom up. Better solutions and new business models have been able to displace those that don’t work as well. Yet if any link in this chain were removed, barriers would prevent this process. For instance, if VC finance were scarce in technology, then it would be harder for solutions to scale to the next level of development and incumbent players would maintain more control.
What has happened naturally in the tech markets is that the “right thing has been the easiest thing”. This has created a truly transformative, adaptive market. There are fewer barriers preventing someone from setting up an innovative global tech business than an innovative healthcare solution or a bank. Yet the sector has not collaborated at corporate levels, they have not looked to Davos for solutions and it has not been organised top down.
How can we apply this learning to other sectors? There are already some examples where markets have been rebalanced without the use of regulation. The Fairtrade movement has inspired innovation and sustainability in coffee, cocoa and many other supply markets where natural short term market forces were leading to unsustainability. Unsustainable supply is bad for growers, manufacturers, retailers and consumers; so the Fairtrade system has effectively a more balanced and prosperous outcome for all.
The same approach could be used in large corporations to solve endemic problems which conventional strategy fails to address. I have been working with The Fairbanking Foundation, an organisation that works with banks to create and certify new financial products that improve the financial wellbeing of their consumers. Some products make it easier for customers to make and reach savings goals; others help customers to better manage income and expenditure. Both improve market sustainability. And this type of innovation requires no regulation. It just uses the market.
Likewise, in healthcare, we are looking at the barriers that prevent ‘the right thing’ from happening. On this basis we are designing and implementing solutions to overcome these blockers. First, one of the most serious problems in healthcare is that health organisations are not assessed on the basis of the value they deliver to patients – that is, on the basis of positive patient outcomes for every pound spent. So we are developing a value based measure to make this easier. Second, healthcare organisations are unable to transform their service models to satisfy today’s needs. So we’re setting up public sector vehicles to test and scale new service models with the potential to better serve the needs of a target group. These come from healthcare practitioners, social carers or members of the community.
If market forces are causing a sustainability failure, then we must find solutions which alter the market dynamics in order to drive sustainability. The logic applies equally to private and state controlled markets, or to problems internal to corporations. All that is required is thinking differently about the problem. Instead of creating more regulation, what is needed is a strategy for taking away barriers for the market to correct itself. In other words, we need to find ways to make the right thing the easiest thing.
35 social care professionals, local authority representatives and policymakers discussed reforms to the draft Care and Support Bill at an event hosted by the RSA’s 2020 Public Services Hub. Alex Fox FRSA, CEO of Shared Lives Plus, guest blogs about the event and Bill.
There can be few people unaware that there are NHS reforms afoot in the UK. Yet few are aware that the most sweeping social care reforms in post-war history are now taking place, with existing ‘poor-law’ based social care law to be replaced by new legislation outlined in the draft Care and Support Bill.
The Care and Support White Paper which preceded the Bill set out a new vision for the ‘personalisation’ of social care. This takes the idea of individuals having an individual choice of service and control over their lives as read, but recognises that even a well-funded, well-tailored service does not always add up to a good life, particularly if your support needs are social rather than entirely physical. For instance, taking a cash Direct Payment in lieu of a service to hire and manage a team of Personal Assistants can be the ideal solution for meeting physical support needs while staying in charge of one’s own life. One individual who now manages his own care said, “When I got my disability I was stuck in hospital whilst services argued over paying for adaptations to my house.” Yet if someone’s challenges involve isolation or social exclusion, the solutions are likely to lie partly in that individual’s unpaid relationships with families, friends and others in their community.
The reorganisation of social care around promoting wellbeing is a radical and welcome vision. But there is concern that the draft Care and Support Bill will not fully enable this vision in practice. Five pioneering community support organisations -Community Catalysts, In Control, Inclusion North, Inclusive Neighbourhoods, Partners in Policymaking, Shared Lives Plus, as well as a leading Director of Adult Services – have argued in a briefing on the draft Care & Support Bill that the Bill needs set out a different route into – and out of – social care to achieve an affordable, more empowering and more successful care system.
In particular, the care organisations argue that eligibility tests should not be the first conversation which people have when they encounter social care. Instead, they should be offered support with life-planning as the first intervention. These personal planning discussions would look first at the individual’s strengths and skills, rather than considering only their needs; then at their existing supportive relationships with family, friends and the wider community; and lastly at services. The wellbeing principle should be developed to set out in plain English a minimum acceptable level of wellbeing to replace the current Fair Access to Care Services (FACS) eligibility criteria.
The recommendations are based on the care organisations’ experience of how people are changing lives and communities for the better, often with less money than has been spent on traditional services. At a recent roundtable hosted by the RSA’s 2020 Public Services Hub and chaired by Paul Burstow MP, who currently chairs the Joint Committee scrutinising the draft Care and Support Bill, one participant said that the current system intends to be empowering but “drags us back” into a deficit-focused model and “dependency culture”. In contrast, when disabled people and family carers themselves are involved in explaining support options to others, there can be a more honest conversation. A parent said, “When I had my daughter in the 1970s it felt like I’d fallen down a rabbit hole into a world I didn’t know existed. I had no support strategies and was battling every day to get simple things. Other local parents were holding on to what they knew and were wary of change.”
Likewise, Partners in Policymaking runs citizen leadership courses for disabled individuals and the parents of disabled sons and daughters, and brings families together for peer support and to influence decision makers. Before the courses participants say that they would often “just talk about their problems, not about what would make things better”. After completing the courses, many people get jobs and some set up groups or social enterprises to tackle the challenges they have experienced: “I would have been one of those parents who wrapped my daughter in cotton wool, but I started to see her as a citizen of this world with the same rights as others and now she’s done two degrees. We learnt to ask for what was needed, not what was on offer and we built a community. One young man would have gone into residential care when his Mum went into hospital, but with support from the network he is still living at home after seven months.”
Moving away from the mindset of “These services are what we have on offer” towards “What would you see as a good life and how can you move towards living it?” represents a huge culture change, particularly at a time when many services are in crisis mode. Mechanism changes such as personal budgets, implemented in the aim of personalising care, have not always created change of this kind. Though some councils, providers and professionals have implemented personal budgets, these are still used to buy the same old services staffed by the same people. In contrast, two social entrepreneurs described how they had built upon the skills and insights they had gained working within public services to identify a gap in current provision, going on to set up their own small enterprise which provides transition support for young disabled adults which is tailored to their goals in life. They are just one of around 800 micro-enterprises known to the partner organisations.
A new social care law cannot legislate for culture change of this kind. But, while Direct Payments remained little used for a decade after they were introduced into law, the cultural shift towards individual control which eventually followed them would not have happened without the original legislative change.
Some councils are already trying to make a change of this kind, even within the present system, with FACS tests replaced by questions which could be used to define acceptable wellbeing such as: Are you safe? Can you live with dignity? Do you rely upon services for personal care? Are you connected to those around you? Are you able to be an active citizen in your community? A personal planning approach which helps people to find, recognise and use all kinds of resources and relationships, including family care, community groups and new links to people in similar situations, will often find ways of improving wellbeing without relying upon services.
However, developing a different approach to care with local spending cuts of up to 40 per cent is clearly a challenge: “we are reneging on the welfare state commitment made in the ’40s, with no evidence that the taxpayer will step up. So we either abandon those goals, put our hands in our pockets, or take collective responsibility and have a new public discourse on care.” Or as one council representative said, “it’s not ‘doing more with less’, it’s doing ‘different’. We need to remember that we are often the minority partner in the provision of care and to be careful about where we are putting our big feet. The economy of regard doesn’t function in ways in which we always understand.”
Perhaps we should be a little bit more rigorous about how we do good. And maybe voluntary sector groups should say no to funding more often.
These were two of the more surprising observations from our policy roundtable at the Liberal Democrat Conference in Brighton this morning. With the support of Asda, we brought together a group of wise heads to talk about the future role of business in creating social value, and the changing relationship between government, public services and business. We wanted an opportunity to discuss the findings of two of the RSA’s recent reports – Community Footprint and Business, Society and Public Services – which make the case for shared value approaches. But in all honesty we were braced for a good deal of lip service, some polite apathy and the occasional raspberry. These are hard times for many businesses, so the idea that they need to concentrate more on generating social value looked sure to be a tough sell.
In fact, there was general agreement that we were asking the right questions and looking in the right direction. Vince Cable MP, Lord Newby, Stephen Gilbert MP and Alison Seabrook of the Community Development Foundation led a thoughtful discussion. The proposition that business needs to step up into a new role, given that public resources are stretched like never before, seemed to be taken as read.
The question for the morning was how to take that step. We don’t lack examples of good practice. Our reports are full of them. Asda talked eloquently about its Community Life programme. But what will it take to ensure that good practice at the margins becomes mainstream? What would get in – as one participant put it – ‘into the marrow of business’? We still seem to be tripping over the limitations of traditional Corporate Social Responsibility, in which social value has tended to be an add-on, a donation, a gift determined by the giver.
Shared value approaches can help avoid these obstacles. They suggest a mature dialogue between business and its social partners, through which the social needs and constraints of markets can be identified and addressed in the round. From this morning, it seems that there are at least three things that would help:
- Sufficient local autonomy within national businesses to enable community dialogue;
- Better measures for social impact (triple bottom–line reporting anyone?); and
- A clearer line from the voluntary and community sector about help that really helps, rather than a willingness to pick up every fresh opportunity with gratitude.
Though these are some way short of a paradigm shift, these would be positive first steps. So, a good morning at the seaside. Next stop Manchester.
Politics is the art of hard choices. But it is also the home of false dichotomies. When it comes to our approach to growth, some fundamentally unhelpful caricatures have taken root that need to be put aside. At their crudest, they pit public spending (and public services) against business and economic growth, with each – directly or by implication – antithetical to the other. Our public services are either social bulwarks to be preserved, now more than ever, as markets fail and communities struggle; or our sprawling public services are culpable for our spiralling debts and are continuing to crowd out genuine growth. Neither side acknowledge the need for change. Public services are to be protected, not reformed. Business needs to be freed to pursue the bottom line.
The problem is not so much that these positions about growth are widely shared or deeply adhered to. Even now, with nerves frayed by recession and painful public spending cuts, most political debate is considerably less either / or than its Manichean rhetoric might suggest. The problem is that the ‘pro-growth’ or ‘pro-public service’ caricatures have distracted from the fact that many of the key elements in the debate are actually in flux. Growth for GDP is being challenged by imperatives for sustainable growth; public services as dispensed through monolithic providers is being challenged by public service entrepreneurship and supply-side diversification; and business’ exclusive focus on the bottom line is being challenged by shared value approaches. Put all these changes together, and it becomes clear that the way forward will require new forms of joined up thinking at the top of government, and new forms of collaboration at every level. Public service reform and economic growth are two sides of the same coin, but they risk pulling in different directions without an operational framework and a shared agenda.
Today, the 2020 Public Services Hub launches a major new report – Business, Society and Public Services - that sets out what the key elements of that framework could consist of. It uses a social productivity approach to identify three preconditions for practical success. The first precondition is new shared spaces for policy making and business decisions. Government, local and central, has a strong role in convening these spaces, but its role may be to set the objectives and devolve the detail. The report looks at the Zero Carbon Hub, set up by the National House-Building Council with seed corn funding from DCLG, which has successfully taken responsibility for implementing the Government’s commitment to make new homes carbon neutral by 2016. The second precondition is new shared values. Again, government’s role is critical. Though it cannot and should not try and do everything, it can set clear goals and establish values, encouraging business and public services to think beyond delivery and create long-term shared goals. Public agencies can play a unique convening role – something we already see in the case of FE colleges. The third precondition is new shared resources. Business and public services alike need to look beyond their traditional resource bases if austerity is really to drive innovation, rather than retrenchment. For example, the report looks at how Sunderland City’s Council’s ‘virtual’ back office serves its own business needs, but also those of local businesses and start-ups.
It’s clear from the evidence brought together in this report that change is underway, and that over the long term we are likely to see the erosion of many of the oppositions within which we have constructed our approaches to public policy and business practice. The development of a new set of richer, rebalanced and mutually supportive relationships between public services, the private sector and society is a realistic ambition. But the report comes with a warning. Exciting examples of hybrid forms and shared responsibilities should not hide the fact that to date, this is change at the margins; and for most businesses and most public services, business as normal continues to hold sway. The challenge for political leadership is to resist the comforts of old oppositional caricatures, and do more than exhort collaborative aspirations. Really being in it together won’t be easy, but the potential gains are huge.