We need a ‘major revolution’ rather than ‘small scale evolution’ in public sector commissioning

14^th October 2013

John Tizard reflects on ResPublica’s fringe event with the Minister for Civil Society at the Conservative Party Conference

I had the privilege to chair an excellent discussion at the ResPublica fringe meeting on public service innovation. The conversation focused primarily but not exclusively on the social sector’s contribution.

Speakers including Nick Hurd, Minister for Civil Society, acknowledged that the social sector – charities, community groups, social enterprises and co-operatives – have a long record of innovation. And whilst there has been and is significant innovation in public and business sectors too, the social sector is particularly well placed to innovate because: it is close to and/or run by its users; not as hampered by as many media, political and legal constraints as the public sector; and less concerned with maximising shareholder benefits than businesses.

However, there is a serious risk that inappropriate behaviours and a pursuit of lowest cost solutions by public sector commissioners and procurers could stifle the social sector’s ability to innovate.

Excellent public sector commissioning is not the same as procurement. The latter is simply one means of implementing commissioning decisions to secure outcomes which meet needs and are affordable. Public sector commissioning should be neutral as to the sector of the provider as long as the solutions secure effective outcomes, value for money and social value. It should be about identifying need and exploring the best way of meeting that need. It has to involve service users and should also involve social sector organisations, which may represent or have evidenced based knowledge of what users want and need; and have ideas of how these needs can be best addressed. And when it comes to potential procurement of services, such involvement should ensure that the procurement process and contract terms do not exclude social sector bidders.

Public sector commissioning should be focused on outcomes and it should encourage innovation and experimentation. Over prescriptive contract specifications (many of which are based on the traditional way of operating rather than encouraging new approaches) simply fossilise inappropriate service provision. They prevent providers in the public, social and business sectors from introducing new services and new ways of delivering existing services. There is also a risk that they prevent holistic and people-focused responses to need.

The fringe meeting discussion reaffirmed my view that we need a ‘major revolution’ rather than ‘small scale evolution’ in public sector commissioning, procurement and service delivery. This revolution requires new attitudes and behaviours rather than new processes or regulation. It requires less centrally driven performance management and targets, and greater local choice and diversity. It has to be value based – and for me, these values must include the equality both of access and outcomes, accountability, excellent employment practice and public benefit (not just benefit for direct service users).

The revolution also requires the public sector to work with and empower communities and the voluntary and community sector to identify needs and problems that require solutions; and only then jointly decide how best to solve these needs and problems, rather than starting with existing services or existing ways of doing things.

People and communities have needs that transcend public sector silos and agencies, professional boundaries, and the public, social and business sectors. Many public policies are interdependent but current organisational, financing and professional structures prevent truly holistic or even collaborative solutions. This has to stop, especially at a time of severe public expenditure constraint.

Whole place, ‘Total Place’ or ‘Community Budget’ approaches need to go much further and allow local places through their locally democratically elected mayors and councils to have control (or at least a significant influence) over much of the total public spend in the place, including the authority to make local choices. Of course, there may be some nationally determined entitlements for every citizen – for example a guaranteed income or right to education or health care but the detailed arrangements should be locally decided. The social sector and especially the voluntary and community sector can and should play an important role, not only as service providers but as the voice and advocates of communities of place and interest. The public sector has to be ready to acknowledge, facilitate and financially support this role.

In terms of public service delivery, not every organisation in the voluntary and community and social sectors will wish to deliver public services on a contracted basis – indeed, the majority currently do not. This is their right and their choice which must be respected by the public sector. For those that do wish and are able to, delivering public services funded by the public sector grant aid may as appropriate as competitive procurement and contracts. Where there is competitive procurement and contracting, these must be social sector friendly, based on the principles of the Social Value Act and encourage experimentation and innovation.

I envisage that in a few years’ time, there could be new models of local community and voluntary organisations which: engender, support and lead local social action; act as champions for communities and users, and as such challenge and collaborate with a range of public, business and social sector organisations; unlock the human capacity and assets of communities and places; and above all create fundamentally different solutions to meet people’s needs and aspirations. In this endeavour, they should be supported, partnered and joined by a revolutionised people focused public sector pursuing social value and fairness through enhanced service, commissioning, regulatory, taxation, redistribution and leadership roles. And, one hopes but less optimistically, with enlightened businesses adding social value too.

The ResPublica fringe event has certainly got me thinking; I hope others will be picking up the thought baton.