Monday, 15 February 2010

Casework and Co-ops

After work I have spent an hour with a future constituent helping them with a problem, part of which is problems with the decent homes programme which is meant to ensure that social housing is brought up to a minimum level of habitable living. There are real problems with this programme, from which the government has raided money from to fund affordable housing construction, a noble aim but not at the expense of existing tenants.

Then I returned home and read, on the BBC, about the Tory plans for public sector workers to be able to set up workers co-operatives to run their own services. The three main parties are in broad agreement that voluntary sector organisations should be able to run public services. In fact, under Labour some limited examples of "spin offs" where staff form charities and run the services, have happened. An example is Central Surrey Health, which has taken over community care and was spun out of the Primary Care Trust. It is suceeding because of the visionary leadership of a management team and because the staff team were at such a low ebb this option seemed attractive.

However, as someone who spent 5 years helping voluntary groups scale up to win public sector contracts and now bids for them as a Charity manager, I have a few issues with the Tory proposals. I think the Tories underestimate the complications of part of a public sector spinning itself off. We are encouraged to consider a Social Enterprise model in the NHS but the problem is that new staff cannot be part of the NHS pension scheme, immediately making it less attractive as an employment option. If you do allow access to the same public sector employment terms you expose public sector finances to considerable risk in that this co-op would be effectively subsidised. For example, in the NHS the pension system is a pay as you go system so if the pension liability encumbered by the state increases at a later date, the Co-op staff members do not pay.

If Co-op members can profit from cost cutting, a proposal in the Tory plans, then what happens when the reverse happens - i.e. when the co-op fails and the service is essential and hard to provide by other bodies? It is very likely the co-op members would not be liable. So its hard to make work without stacking all the cards in the contracted organisations favour. In addition, I am a critic of the Foundation Trusts and Academy model, as it has reduced the joint working in the public sector and incentivised public bodies to hide information.

This is not to say that charities and indeed private sector organisations will not have a vital role in delivering public services. They always have, from your NHS funded Dentist to independent firms maintaining the roads. But the Tory Plans are overly simplistic and strike me as an attempt to appear not like the nasty party interested in preserving the affluent lifestyles of the rich few at the expense of the rest of us. As usual their plans lack intellectual rigour and are a cheap attempt to grab a headline. Real reform takes decades not weeks.

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