A responsible society. An enterprising economy. New leadership for new times.
Forgive me if this is an overstatement, but surely there has never been a time when our major political party leaders have been held in lower regard? There is the one who is apparently unable to manage his own Party, the one few people seem to think could manage the country and the one who simply has no friends.
A few weeks ago I was talking to a talented young MP who was telling me of his plans to leave politics. ‘I’m bored’ he said ‘I don’t believe in politics anymore and, truth be told,’ he said, as he cast his eyes around the atrium at Portcullis House ’nor do most of us’. A Conservative MP said to me that his Party’s obsession with Europe is partly based on genuine problems with the EU, partly on the divisive Thatcher legacy but also ‘because at last people have got something in politics to get passionate about’.
Is there anything that can be done? Regardless of party affiliation is there a message or strategy that could lift politics out of the doldrums and offer a credible policy platform. As a purely academic exercise I’ve had a go.
The rather obscure starting point is this table
| Fairness/solidarity | Progress/hierarchy | Freedom/individualism | |
| Ends/vision | The good society (2) | Human progress (1) | More of whatever we want (3) |
| Means | Invest in public sphere, redistribute (3) | Strategy, bureaucracy (2) | Self-interest, markets (1) |
| Culture | Tribe, flag, movement (1) | Statism, deference (3) | Consumerism (2) |
In the columns I have merged two frames of analysis. The first is from cultural theory and its three ubiquitous ways of thinking about and seeing change: the individualistic, the hierarchical and the solidaristic (NB there is also another passive form – the fatalistic).
The second uses the three core ideas of the Enlightenment as identified by Tzvetan Todorov: universalism (which I translate as fairness), humanism (the belief in progress defined by greater human flourishing) and autonomy (freedom).
These two sets of concepts (which have been the focus respectively of two of my annual lectures), one about ideas the other about frames for seeing and acting, don’t map neatly onto each other. ‘Universalism’ asserts the equal rights of all people (although in the Enlightenment this actually meant well-off white men) whereas ‘solidarity’ is about the interests of those defined as in the group while ‘fairness’ stands somewhere between and also brings in notions of just desserts. Also, hierarchies can be ambivalent about progress (think of the Roman Catholic Church). It is also important not to assume that individualism and solidarism line up on a right left axis. Nationalism and even racism can be as much expressions of in-group solidarity as trade unionism and – as the Commons debate yesterday emphasises – social conservatives don’t think individual rights trump all other considerations.
Nevertheless, for the purposes of my argument, there is sufficient overlap based on clustering of ideas and feelings around three fundamental human instincts (individual survival, desire and ambition; kinship and social belonging; and leadership/followership).
In each box there is a number. The numbers represent a view of the relative power in contemporary society of each way of thinking in relation to, first, their account of the ends to which change should be aiming, second, the means which should be used to achieve that change, third, the cultural milieu in which change takes place.
The argument is that hierarchy is most powerful when it comes to the task of describing the ends of change. To put it simply, we need leaders to tell us where to march towards. Solidarity/fairness is less powerful when to comes to ends partly because it is often a rather nostalgic or defensive expression, and also because its definition of the good society (whether it’s socialist utopianism or nationalist nostalgia) tends to sound rather pie in the sky. The perspective of individualism leads to a suspicion of the whole idea of purposive ends – where we get will depend on our choices with the hidden hand of the market ensuring progress.
When it comes to means – the method of change – individualism has the strongest hand; a position which is even more pronounced in today’s complex world. If we could achieve change simply by people doing what they feel to be in their own interests things would be pretty simple, which is why markets can be so fast moving and innovative in comparison to bureaucracies (hierarchy) or collectives (solidarity).
Finally, in terms of cultural mores, while individualism offers only the shallowness of consumerism and hierarchies tend to be fractured both horizontally and vertically, it is the domain of solidarity that provides meaning and belonging for us social beings.
Therefore, in modern society, the most effective model of change will involve leaders defining ends which inspire, using means which achieve those ends through alignment with individual choices, with processes of change being humanised by a culture resonant with solidarity and mutual obligation. To use a mechanical metaphor, hierarchy sets the direction, individualism provides the engine and solidarity is the oil.
How does this translate into a political programme? First, we need a new type of leadership (I have described this here). Second, we need both to draw on individual aspiration as the most effective means to change while also helping people to aspire to what will genuinely provide fulfilment not simply what advertisers tell them they should want: freedom to produce, create and connect rather than freedom merely to consume and possess. Finally, we need to find ways of generating new forms of solidarity and mutual obligation in a diverse, fast changing world.
Politicians are often told by their advisors to try to ‘own the future’. This means rather than simply hypothesising a better world, describe the things already happening that prefigure that world and then show how you are the person to liberate the forces of progress and remove the barriers to change.
As I said in my last post commenting on the possible end of the social recession, there is enough material to start to describe what we might mean by a responsible modern society. Also, with the growth of interest and engagement in enterprise (traditional, social and micro) we can begin to see the outlines of a new venturesome economy.
Sadly, when it comes to new type of leadership, at least in the political sphere, I can only refer back to my opening sentence.
Probation PBR – (a lot) more questions than answers
There should be no one who knows more about the perils and pitfalls of payment by results (PBR) than Justice Secretary Chris Grayling. After all it was he who as a DWP minister oversaw the implementation of the Work Programme which is as yet failing to demonstrate the step change in efficiency and performance that he is hoping to see from the probation service.
There are several reasons to question whether PBR for probation will deliver:
All PBR systems are subject to the inherent tendency for providers to ‘skim’ and ‘park’. The former process involves identifying those in the client group most likely to achieve an outcome (in this case not reoffending) with very little support. The provider then gets paid for something which would have happened anyway without having to add any value (economists call this ‘rent seeking’) and the taxpayer picks up the dead weight cost.
Parking involves limiting the service provided to people who are highly unlikely to meet the outcome and in whom it is therefore cost inefficient for providers to invest resources. The latter phenomenon leads to one of the classic debates in the design of PBR – one which has been rolling around the probation debate – should payment simply be for the result (not re-offending) or should there also be payments for what is often called ‘direction of travel’ – things like attending life skills courses or entering drug treatment. The case for direction of travel payments is that it incentivises providers to do something for the hardest to help; the case against is that it provides scope for gaming and the proliferation of ineffective interventions, such as payments for members of troubled families to attend parenting classes of questionable efficacy.
A particular risk for probation arises from the private/third sector PBR system running in parallel with the state probation service, which will continue to be responsible for more dangerous ex-offenders. The temptation for new providers to dump harder to help clients back on to the probation service will be strong. And while collaboration between providers is essential ,regulating that boundary is likely to be a continual source of tension on the ground.
Given the weak results so far from the Work Programme it is a bold claim that PBR will deliver better outcomes and provide a wholly new service for short stay ex-offenders all within a declining real terms budget. Some organisations are being very bullish about the possibilities for them to provide great services in the new system, but similar big ambitions articulated by putative Work Programme providers went largely by the board when, under pressure from the Treasury, the contracts were ultimately awarded almost entirely on the basis of price.
Third sector organisations looking to be PBR probation providers should heed the five (yes, five) harsh lessons of the Work Programme.
* Charities, lacking the contract planning and negotiation capacity of the private sector, generally failed to get on the original framework of prime providers. Many wasted tens of thousands of pounds in failed bids.
* Many charities which subsequently entered subcontracting arrangements with primes then felt a lot of pain – in many cases terminal – as the expected and promised client referral rate failed to materialise.
* Relatedly, the PBR mechanism means the contracts have what is sometimes called a ‘smile’ profile. That is, providers get some money up front as an attachment fee but then have to pay for services and make a revenue loss before later in the contract starting to get payments for meeting outcomes. Lacking reserves or access to finance many third sector providers are simply unable to ride out the downswing of the smile.
* The PBR margins on offer to the third sector are anyway very modest on contracts which were already tight even before the prime providers had taken their cut. Many third sector providers are in effect subsidising their provision with charitable income (something which raises difficult issues of propriety and transparency).
* Many third sector providers who thought they were doing a good job found that they were unable to cope with the monitoring and performance requirements of the various PBR employment programmes (indeed across the sector third sector providers are having regularly to hand back contacts). Whether this means the system is badly and unfairly designed or that lots of third sector provision is not actually any good is, of course, bitterly contested.
A third problem with PBR as a mechanism for providing public services is the flip side of a claimed advantage. When advocating the Work Programme PBR ministers were apt to talk positively about the ‘black box’ of service delivery. Rather than the over regulated and over managed state services providers would be free to use whatever mechanism works best to achieve the outcome. As one advisor put it to me ‘if getting people to stand on their head and read poetry gets them back into work then what’s the problem’? Fair enough; but the black box in combination with competitive pressure means there is also little incentive for providers to share information, compare practice and improve. ERSA (the trade body for employment programme providers) has been working with Nesta and the RSA to encourage greater information sharing and innovation in the sector but it is not easy to convince providers they should share trade secrets, or even agree a common framework of professional standards.
Most of these issues are generic to PBR as a mechanism. Indeed I have had some rather worrying conversations with civil servants who seem unaware that issues like this are not random risks but core characteristics of such systems, whatever their other advantages. But in probation there is one other major issue.
If a work programme provider fails, someone continues to be unemployed but if probation supervision fails, an ex offender may commit a serious crime. The Work Programme and other employment programmes such as Mandatory Work Activity have been subject to much critical media scrutiny but this is as nothing to what will happen if a badly supervised private sector probation client murders someone. I simply have no idea how a private provider could factor in such massive reputational risks to the cost benefit equation of bidding.
The basic idea of payment by results whereby taxpayers pay for outcomes rather than processes is powerful, especially in a time of austerity, and for a number of reasons PBR is likely to grow. As the chair of the board of a smallish employment service company, I can see both how good practice can deliver powerful results for disadvantaged people but also how tough it is to make money (something which should reassure the public).
The potential upside of PBR makes it all the more important that we understand its inherent pitfalls.
Corrupting care
Here is an extract from a speech given yesterday by Liz Kendall Labour’s shadow spokesperson for care and older people:
Our goal must be to create a new care covenant between citizens and the state, involving all parts of our society and economy. This covenant should be based on the principle that care is a shared responsibility – its risks and benefits are mutual and should not be left to individuals and families to shoulder alone. It must be grounded in values of dignity and respect for those who need and provide care, ensuring older and disabled people and their families have the same choices and chances to live the lives they want as any other section of society.
And it must seek to strengthen mutual care and support within our families and communities, as well as through care services
Fine words, as my grandmother used to say, butter no parsnips. But it is good to see an emphasis being put on values, mutual care and shared responsibility as well as Government policy. As I have argued here before, we need a ‘whole system’ reform of care – something which involves attitudes, behaviours and norms as well as policies.
Yesterday I interviewed the philosopher Michael Sandel for the next edition of the RSA Journal. We discussed his book ‘what money can’t buy’ which has just come out in paperback. In it he bemoans the ‘marketisation’ of more and more areas of life evidenced, for example, in poor children being bribed to study or sports memorabilia being turned from personal objects collected by fans to a billion dollar mass market. His objection to such practices lies in the way they exacerbate inequality.
The more things that are paid for, the more difference having money makes to people’s lives. Take the example of ticketing. If the criterion for access is a willingness to queue early or long, the tickets will tend to go to the most passionate, but if the rich can buy tickets whenever they want from on-line sites, wealth rather than passion becomes crucial.
Sandel also worries about the way financial incentives ‘corrupt’ motives and meanings. If we bribe children to read, do we reinforce the idea that reading is onerous? If we can pay for a footballer’s autograph, it lacks the intrinsic value which we would attach to something we had collected ourselves in a memorable encounter or just standing in the rain for hours.
Bringing together Michael’s analysis and my interests, we had a fascinating conversation about care. This is surely the most important example of the way the value of something changes when it is marketised. The very idea of care contains within it a notion of emotional commitment. Yet, however much we might teach nurses how to be compassionate, we cannot get inside the heart of someone who is paid to care and force them to experience the feelings that we have when we care for a loved one and which we want to believe lead loved ones to care for us.
Michael reminded me of a famous article from 2001 by Arlie Hochschild called ‘The Nanny Chain’ which ponders what we are doing to people and relationships when immigrant carers are paid to look after middle class children and use their remittances to pay a different stranger to look after their own children back home.
In terms of Sandel’s idea of corruption, consider the contrast between the value we place on care in the private and public domain. In the former we say that nothing matters more than the welfare of our loved ones. We give and receive care as part of a web of reciprocity which goes towards defining who we are as social beings. But in the market, care is low status and low paid. Might it be that the low value ascribed to paid care might corrupt the status of voluntary and familial care, adding a loss of self-worth and status (and influence) to the other challenges of being a carer?
To argue that the socialisation and marketisation of care may be problematic is difficult. It might sound like a suggestion that there was a golden past of unlimited compassion, or a failure to appreciate the radically different conditions created by population ageing and female employment, or – worst of all – an attempt to force care back into the home and onto the shoulders of unpaid women.
Politicians are under pressure to come up with solutions. Labour is putting its emphasis on the need to join up social and health care commissioning and perhaps underestimating the reasons why this is very hard to do. But no reconfiguration of spending or services is going to be enough to resolve the care crisis. Liz Kendall is right: we must explore care as part of our lives and our society as well as a particularly intractable set of funding and policy problems.
Manufacturing an argument
From time to time in this blog I rehearse arguments I intend to use in a forthcoming speech; partly to prepare my lines but also to see if readers will offer helpful nudges. This evening I will be stepping well outside my comfort zone and speaking on the topic of manufacturing to a conference of business leaders who work in the sector, and bankers who help finance it. I am not on until quarter to ten so I suspect my audience will want bold brush strokes not intricate policy detail, which is just as well.
As an outsider I have perceived advocacy for manufacturing as a mixture of idealistic yearning and pessimism. We generally view manufacturing positively, associating it with a golden past when Britain was the workshop of the world, but we also assume that the days have long passed when we could see ourselves as significant global players or believe that manufacturing is an essential part of our overall economy.
Arguably, Government policy reflects these feelings, as well as a continuing scepticism towards economic interventionism. Responding to our affection for manufacturing the Coalition has pursued a number of policies which favour the sector, and particularly at its leading high tech edges, but has also resisted the kind of full blooded national commitment to manufacturing which formed the centre piece of President Obama’s State of the Union address in January 2012:
‘So we have a huge opportunity, at this moment, to bring manufacturing back. But we have to seize it. Tonight, my message to business leaders is simple: Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed’.
Ambivalent attitudes to British manufacturing are reinforced by a mixed reality. On the one hand, Britain remains a relatively important manufacturing nation – around the eighth or ninth largest producer in the world depending on what metric is used and in certain sectors, aeronautics, pharmaceuticals (including life sciences) and automobile, we have genuine strength. On the other hand, manufacturing continues to be in decline in terms of our global ranking and there is little sign of any significant bounce back in terms of activity levels. Most depressingly, British manufacturing seems to have taken very little advantage of the effective devaluation by a quarter in the international value of the pound which took place after the credit crunch. The statistics for February this year show the UK running a trade deficit on goods of close to £10 billion pounds a month.
The manufacturing sector is diverse (indeed in many areas the divide between manufacturing and services is fuzzy) and the arguments about it complex and long running. There are few easy answers. So tonight I will be in exhortation rather than analytical mode.
The supporters of manufacturing need to make their case in terms not just of the needs of the sector but in terms of a broader account of the kind of economy and society we would like to exist.
We should start with the evidence of what economists call ‘spillover benefits’, whereby investment in manufacturing has been shown to have a positive impact on productivity in other firms. These externalities provide a basis for justifying preferential tax and allowance regimes for manufacturing. Given how important jobs are right now it is also important to argue that – counter to the common view – that areas of rising productivity need not also be areas of declining employment; if productivity gains lead to cheaper, better products it can also lead to more jobs. Also, manufacturing investment generates jobs in other sectors. As Obama Advisor, Gene Sperling, puts it; if an auto-plant opens up, a Wal-Mart can be expected to follow. But the converse does not hold – Wal Mart openings don’t tend to bring auto plants in their wake.
When manufacturing was collapsing in the early eighties – a poignant memory today – there was a view that many areas had become too dependent on certain industries. But in the wake of the economic slump and with the international desire to tame financial speculation that argument can be flipped. For the economy as a whole we need as a matter of wise policy to foster diversity in activity and jobs and right now that means strengthening manufacturing. As well as economic balance, manufacturing can also contribute to a more balanced spatial strategy – it is a cheaper to build factories in the north than the overheated South East.
This is a blog post not a speech so I will make the other points in brief:
As Jaguar Land Rover exemplifies, manufacturing – more generally than services – has a powerful role in the projection of national image of excellence and creativity.
While the UK has a weak self-image in manufacturing, we pride ourselves on our design skills. But modern manufacturing, with a growing emphasis on innovation and customisation can involve very close working between designers and producers. Strong domestic manufacturing and strong design are complimentary.
In terms of global trade, as a forthcoming RSA report will argue, the combination of rising labour costs in developing nations and the possibility over the medium term of higher transport costs is starting to shift the argument decisively away from outsourcing. A number of high profile American firms – including General Electric and even Apple – have announced their intention to bring manufacturing investment and jobs back to America. The big challenge for medium sized firms may be less about expanding exports and more about the capital, know-how, networks and confidence to build factories in other countries.
Also on an environmental tack, while manufacturing has in the past been associated with various forms of pollution, future growth areas of investment, innovation and jobs include green industries and also re-engineering manufacturing processes to minimise waste – the subject of the RSA’s Great Recovery project.
Finally, and this is a matter of conviction not evidence, understanding how things work and being confident about making and inventing should be an important part of national and individual character. It is clear that access to skilled workers is the critical factor in manufacturing competitiveness. This is, of course, about bright students choosing science, maths and engineering and about the need for more and better industrial apprenticeships, but it is also about a wider recognition of making stuff as an activity which combines creativity, analytical and problem solving, and kinaesthetic skills, and which provides distinctive and deep forms of satisfaction and fulfilment.
Ultimately this is why the manufacturing sector has to choose to tell a positive story. When people complain, the assumption is that they are not enjoying themselves. However, hard the challenges facing manufacturing we need people (especially the young) to believe – as they readily do about sport and music – that investing time and commitment to developing manufacturing skills pays off in enjoyment and pride as well as the possibility of a career and good income.
Towards a new care settlement – part 2
I have written a series of posts:
http://www.matthewtaylorsblog.com/public-policy/toward-a-new-care-settlement-part-one/
http://www.matthewtaylorsblog.com/uncategorized/care-by-the-community/
http://www.matthewtaylorsblog.com/thersa/looking-at-care-from-a-different-angle/
http://www.matthewtaylorsblog.com/socialbrain2/sharpening-the-care-diamond/
about the care crisis, what it comprises, why it is worsening and why it is hard to remedy. Today, in the last of the series, I suggest four sets of ideas which might together provide a platform for a long term care strategy.
As I said in my last post, we need our leaders to recognise that there is a care crisis, not simply a crisis for government and policy but for society, our norms, responsibilities, and expectations. We need to set out an ambitious ten year plan to take us to a new care settlement in 2025 (roughly coinciding with the peak of the baby boom bulge in elders). In essence this is about guaranteeing more dignity and support for care recipients and carers but we also need to assert a core aim of policy as to make it easier and less disadvantageous for people (and this should not be taken to mean mainly women) to provide care to their own loved ones, rather than paying other people to do all or most of it.
We must use existing spending on older people to liberate funds for specific and guaranteed improvement in care. The other aspects of my strategy are primarily about using resources more wisely and generating new commitment and effort to improve care, but nevertheless, any shift in direction will involve transitional and on-going new costs. But these costs must not come from younger generations, which, as a number of people including David Willetts have argued, are already in many ways facing a much tougher situation than those who came before them. So new funding for care should come from wealth testing some universal benefits for older people, from further reducing tax breaks on pensions and by going further than the Coalition’s initial step to increase inheritance tax levels.
We must – and this is hardly an original thought – achieve a better integration of health and social care and public health interventions. Everyone from Andy Burnham to the recent House of Lords report argues for this which suggests the barrier is less principle and more implementation. My solution – which may be simplistic – would simply be to transfer the budget for commissioning all health care for people over seventy and registered as disabled, apart from accident and emergency and elective surgery, to local authorities on the strict condition that, as commissioners, councils cannot also be service providers (for either health or social care).
We need a powerful publicly funded but independently governed agency/platform called something like ‘We Care’. The service would oversee my proposed ‘national care experience’ through which all young people between 14 and 19 are expected to undertake a good quality hundred hours care placement. The service would oversee or incorporate Skills for Care and work to accelerate the development and take up of care apprenticeships particularly at level three and above. In time, all workers in the sector would be expected to be on, or have completed, a level three care apprenticeship or equivalent training package. ‘We Care’ would also spread good practice and innovation and, particularly seek to take what works to scale (possibly through a strategic partnership with NESTA and the Big Lottery Fund). Particular emphasis would be placed on the way professional care services in the public, private and voluntary engage and develop volunteers. From the outset ‘We Care’ would have capacity to work with successful UK care providers to encourage them into international markets in what is a growing sector worldwide. ‘We Care’ would also advocate a wider policy and societal sensitivity to care needs, for example in the design of products, services and housing.
Because the care crisis is so huge and multi-faceted we need a strategy with all these elements; honest and brave leadership, new social norms, fair funding, fundamental service reconfiguration, institutional innovation, strategic co-ordination. In these sceptical, anti-statists, times there isn’t much appetite for grand plans but incrementalism simply won’t move us from an already unacceptable care situation which is only set to get worse.
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