Since APSE members heard changes to the best value regime were under way – part of the Local Government and Public Involvement in Health Bill – they have been expressing concerns that it will mean a return to the bad old days of the crude, price-driven, market competition-based approach, seen under compulsory competitive tendering in the 1980s and early 1990s.
So it was reassuring to hear otherwise from a government minister and Audit Commission director at our annual conference.
Speaking at APSE’s annual seminar, at the Sage Gateshead recently, local government minister, Parmjit Dhanda, said: ‘It is not the intention of the Bill to make councils do anything they do not want to do.
‘This has to be about giving local authorities choices. There is more to it than public or private.’
He said it was about the Government working with local authorities and having ‘a dialogue’ on the most suitable approaches for local circumstances.
And the Audit Commission’s director of studies, Professor Michael Hughes, whose colleagues are examining competitiveness and service improvement, was clear that councils should recognise the complexities of decisions about service design, management, and delivery.
He told delegates: ‘The evidence of what works is increasingly clear. Competition has benefits but there are markets such as waste, social care, and home-to-school transport where limits are starting to appear.’
Professor Hughes suggested these limits arose from different causes. The maturity of the waste market made it harder for bidders to distinguish themselves from each other.
There was a significant excess of supply over demand for residential care in most parts of the country. And spiralling costs and local monopolies had been broken by some counties developing an in-house alternative for social care and school transport. Professor Hughes concluded by saying that whoever delivered services – in-house, private sector or non-profit – must be kept on their toes. He described this as the idea of ‘contestability’ – making sure pressures for efficiency and service improvement did not let up after a contract was awarded. The preparation of new guidance on best value is a good opportunity to develop a more effective model for continuously improving front-line council services.
So, we are relieved the Government appears willing to listen to councils’ views on how best to achieve this, and the Audit Commission supports an evidence-based approach. But this begs the question of how councils can make sure they are delivering the best services to their residents in a way that gets the best possible value for their resources? The issue of terminology might seem pedantic, but it is important. The Audit Commission uses the terms ‘competition and contestability’, whereas APSE would suggest the term ‘competitiveness’ is most useful for describing a process of continually challenging and reviewing the value for money and effectiveness of services. APSE is urging local authorities and ministers to consider the Competitiveness continuum model it has developed as a way to compare service performance.
This is a system which constantly challenges and reviews service performance and compares data on how the wider market is performing.
It enables the complexity of local community needs to be addressed and choices to be made as to which are the most responsive, flexible, accountable and sustainable ways of providing services. Local authorities are then able to decide if they wish to pursue alternative options, based on hard facts and the views of local people.
This approach incorporates a performance-management and assessment framework, input from elected members, business process analysis, benchmarking, market analysis, stakeholder perceptions and environmental considerations.
It uses APSE’s performance network, which is the largest voluntary performance measurement database in the UK measurement database, covering 16 service areas. The Competitiveness continuum model includes detailed analysis of; outcomes delivered for local communities, involvement of elected members and, most importantly, the role of local people as stakeholders in improving services.
We believe the approach offered in the competitiveness continuum is the best way to determine Best Value. n
Paul O’Brien is chief executive of the Association for Public Service Excellence. Copies of the Competitiveness continuum pamphlet are available. E-mail: mbaines@apse.org.uk
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