Yesterday David Cameron chose to remind us that public services remained open for business. In an alarmingly honest declaration of his government’s ideological agenda, the Prime Minister assured us that “brick by brick, edifice by edifice, we are slowly dismantling the big-state”.
Promoting the release of Open Public Services 2012, an update to the government’s white paper released last July, Cameron reiterated his “instinctive belief” that a combination of individual consumer choice and increased competition and diversity of provision was key to securing innovation and value for money in public services.
The TUC’s response to last year’s white paper provided ample evidence to show that opening up public service markets actually has the opposite effect, leading to a concentration of provision in the hands of unaccountable private providers. At the same time services became increasingly complex and fragmented, with the greatest impact on the most vulnerable.
To see David Cameron’s diversity of provision in action, let’s take a quick look at developments in the NHS under his open public services agenda.
In September last year, community health services in Surrey were awarded to Assure Medical, owned by Virgin, despite competition from the celebrated employee-owned Central Surrey Health. In November, Circle Healthcare, the ‘social enterprise’ majority owned by private investors, took over the management of Hinchingbrooke Hospital in Cambridgeshire. Earlier this month Suffolk’s community health services were taken over by Serco. Currently Serco and Virgin are the two preferred bidders in line to take over Devon NHS children’s services. And looking ahead, George Eliot Hospital NHS Trust is considering the outsourcing of its management, with Circle Healthcare, Care UK and Serco in line for the award.
So much for diversity, accountability and the breaking up of monopolies.
Yet the ambition set out by the government yesterday is to extend commissioning and competition across the virtually the entire range of public services, including sensitive areas such as prevention, detection and investigation of fraud, debt management and enforcement services, immigration and visa administration and support for looked after children. This last area demonstrating that the lessons of Southern Cross have clearly not sunk in.
As well as extending commissioning, the government is also looking to embed competition by introducing new rights and complaints processes for service users and providers who feel that they have been excluded from competition and choice in public services. The government are keen to enshrine a new “right to choose” for service users, already described as “unworkable in practice” by the Institute for Government. In addition, potential providers will be given “a right of appeal to an independent organisation when they feel that they have been unfairly excluded from a commissioning process”. Every service must be open to competition, every commission open to every provider.
This creates a whole new layer of complexity and cost, with consultants and lawyers no doubt lining up to seize the opportunities. And it also undermines any attempts by public authorities to use the commissioning process to nurture and grow new forms of provider such as mutuals or social enterprises, with few wanting to risk “unfairly excluding” the corporations who will be willing and able to challenge every case .
While Open Public Services 2012 brought little new to the table, it was perhaps the government’s boldest statement yet of its privatising intent.